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Marriott (MAR) Inks Agreement for Branded Residential Project

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Marriott International, Inc. (MAR - Free Report) recently signed an agreement with Masterise Homes, a Vietnam-based real estate firm, to develop a dual-branded residential and officetel project in Ho Chi Minh City.

Per the agreement, nearly 4,200 residential and officetel units will be developed. Per Savills International Development Consultancy, this marks the largest hotel-branded residential project as of now. The project will have branded units from two Marriott International brands — JW Marriott and Marriott Hotels.

Marriott’s, chief development officer, Asia Pacific, Paul Foskey said "The signing underscores the strong appeal of the branded residences segment, especially within the Asia Pacific region."

Dual-branded residential can enjoy hotel-like amenities and on-demand services. Meanwhile, officetel will have benefits of dual functionality of both commercial and residential components.

Demand for mixed-use communities offering, which provide access to on-demand amenities and services, has increased due to evolving lifestyle. These residences will have have both prestige and hotel-like services.

 

Expansion to Drive Growth

The company is also expanding its hotel footprint. In April 2019, the company opened its 7000th property — the 27 storey St. Regis Hong Kong. At the end of third-quarter 2020, Marriott's development pipeline had nearly 2,900 hotels, with more than 496,000 rooms. Further, nearly 228,000 rooms were under construction. The hotel company is also trying to strengthen presence outside the United States, especially in Asia, Latin America, Middle East and Africa. Meanwhile, the company’s European pipeline has grown consistently in the recent past and is expected to continue going forward.

Shares of Marriot have surged 44.2% in the past six months, compared with the industry’s rally of 40.3%. Marriott — which shares space with Hilton Worldwide Holdings Inc. (HLT - Free Report) , Extended Stay America, Inc. (STAY - Free Report) and Hyatt Hotels Corporation (H - Free Report) in the Zacks Hotels and Motels industry — carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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