Here's how many Marriott hotels actually have resort fees
President Joe Biden’s State of the Union speech earlier this month brought the travel industry into political crosshairs. The president called out surprise resort fees as a practice that could get banned under his proposed Junk Fee Prevention Act.
Marriott customers, however, shouldn’t get too excited by the possibility of resort fees (or any other version of the practice, like “city fees” or “destination fees”) going away the next time they book a stay at select hotels.
Further, guests might be surprised to find out fewer than 4% of Marriott’s hotels have resort fees, according to the company’s estimate of its global network of managed and franchised properties.
“You would expect we listened with great interest to the president's comments during the State of the Union. It appeared, if you listen to what he actually said, his concern was ‘hidden fees’ and the manner in which we disclose resort fees or destination fees,” Marriott CEO Anthony Capuano said during an investor call Tuesday. “Combined with the rigorous process we have to approve the implementation of one of those fees and the requirements for a meaningful value proposition before those fees are approved gives give us comfort that we have the right strategy.”
Biden’s Junk Fee Prevention Act goes after hotel companies, cable television providers, airlines and live entertainment ticket providers for drip pricing and not disclosing costs upfront.
“We’ll ban surprise ‘resort fees’ that hotels tack on to your bill,” Biden said during the State of the Union address last week. “These fees can cost you up to $90 a night at hotels that aren’t even resorts.”
Marriott discloses added nightly fees in a blue box at the top of a booking page when you select a hotel from its website. Capuano indicated Tuesday that fewer than 300 of Marriott’s more than 8,300 hotels and resorts partake in the practice of charging nightly resort or destination fees.
Company leaders maintain Marriott has always been transparent about its resort fees.
“Resort fees tend to be a hot topic because I think you’ve probably seen there’s been some chatter out there from the [state] attorneys general about the way they are displayed,” Leeny Oberg, Marriott’s chief financial officer, said at a Skift Global Forum event in 2019. “And I’ll remind everybody that we always make sure they are very clearly displayed before you actually book a room.”
When a Marriott-branded hotel levies a fee on top of the displayed nightly rate, it displays the information upfront. This is thanks to a settlement from when the Pennsylvania attorney general’s office investigated the company on its resort fee practices.
An audit included in the Pennsylvania lawsuit of Marriott’s resort fee-charging hotels in the last five months of 2015 showed only 67% of those hotels disclosed the fee at the time of a reservation.
Rising fees, rising profits
Marriott has made at least $206 million off resort and destination fees at its self-managed resorts since 2012, according to depositions included in the Pennsylvania lawsuit. Hotel owners love the practice because it boosts revenue and profit margins. Critics and guests often see it more as a bait-and-switch tactic on pricing.
The Pennsylvania lawsuit noted hotel owners at Marriott-affiliated hotels charged anywhere between $9 and $95 per night. The lawsuit noted guests received perks that wouldn’t normally be included in a nightly rate, like food and beverage credits or free play at a Las Vegas casino.
The practice draws scrutiny across many brands beyond the Marriott orbit for charging customers for things that used to be included in a nightly rate — or are largely deemed obsolete by today’s traveling and work habits.
A recent TPG stay at an InterContinental property in Boston, for example, included a $34.95-per-night resort fee. What did that include? Free local telephone calls, no fee for a rollaway bed, use of the hotel gym and free photocopies for up to 100 pages, to name a few of the less desirable or less used perks in the package.
An industrywide critique
Marriott isn’t the only brand to face legal challenges over resort fees, either. The Nebraska attorney general sued Hilton in 2019 for resort fee practices and what it labeled “deceptive and misleading pricing practices.”
A Hilton spokesperson at the time noted to TPG that resort fees were charged at fewer than 2% of the company’s hotels globally — a similarly small number to the roughly 3.6% of Marriott hotels Capuano said charge some version of a resort fee.
“In terms of materiality, it's quite impactful for those individual owners, but less impactful on a portfoliowide basis,” he added Tuesday.