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Marriott International, Inc. (MAR - Analyst Report) recently announced the opening of its dual-branded hotel in Los Angeles. Christened the Courtyard and Residence Inn L.A. Live, the hotel brings two of Marriott’s popular brands — Courtyard and Residence Inn — under one banner. The property is owned by American Life, Inc. — a well known U.S. property financer, developer and manager — and Williams & Dame Development — a Portland-based real estate development firm. The development of the hotel is part of the renovation of the business district of Los Angeles.

The hotel has 174 rooms under the Courtyard brand and 219 suites under Residence Inn. The hotel also offers a state-of-the-art fitness center and two meeting rooms.

Marriott has been opening hotels in the city centre of Los Angeles — a JW Marriott and Ritz-Carlton dual branded hotel in 2010 — to cater to rising demand in the area. In fact, it was the success of this hotel that prompted Marriott to build another property in the same area.

Dual-branded hotels seem to be the latest trend among major hoteliers. Hotel companies like Hilton Worldwide Holdings Inc. (HLT - Snapshot Report) and Intercontinental Hotels Group plc (IHG - Snapshot Report) are offering multiple hotel brands in one location. Apart from helping the parent company to reduce costs, dual branded hotels offer tourists the access to a wide range of amenities.

We expect the dual-brand concept to continue to gain popularity, as the potential benefits for hotel owners and developers cannot be denied. In addition to being cost-effective, the concept enables hoteliers to position a single hotel in two distinct markets, thus drawing diverse target demographics. Further, the large number of rooms in the offing enables the hotel to attract and deal with a greater volume of guests.

Marriott currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the same industry is Home Inns & Hotels Management Inc. (HMIN - Snapshot Report), which sports a Zacks Rank #1 (Strong Buy).

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