The micro-hotel room is having a moment.
Marriott International confirmed Monday morning what had been arguably the world’s worst-kept secret in the hotel orbit: It was buying Dutch lifestyle hotel brand CitizenM. The 36-hotel lifestyle chain, known for its small rooms and tech-forward service as well as modular construction, has been a hit in America, where it has properties in major coastal cities as well as Chicago. CitizenM also has hotels in Asia and Europe.
Some — present company included — might be wondering the logic behind the deal, which entails Marriott paying $355 million upfront for the brand and intellectual property and then $110 million based off future growth.
Sure, IHG Hotels & Resorts announced its own play for this market segment in February with a $116 million deal for Ruby, a 20-hotel collection in Europe. Additional players in this space include Mama Shelter, part of Accor’s Ennismore lifestyle arm, Yotel, and Hilton’s Motto.
But it’s not like Marriott was devoid of a competitor here: Moxy, with 161 hotels worldwide, is the industry leader for this type of brand. CitizenM currently has 36 open hotels with three more expected to open by mid-2026. That’s slightly behind schedule compared to when CitizenM leaders touted to this reporter in 2022 plans to have more than 40 hotels open by the end of last year.
There are two ways to read this: On the one hand, linking up with Marriott gives CitizenM massive distribution reach by tapping into the world’s largest hotel company’s Bonvoy loyalty network and reservations platform. Further, lenders like the stability a brand like Marriott can bring to any potential real estate deal in the works.
But those scratching their heads at brand overlap should know by now that’s a concern long in the past for the hotel industry. Instead, it’s all about having a menu of options across various price points. Just as Marriott has luxury hotels at different rate points a la JW Marriott, Edition, St. Regis and Ritz-Carlton Reserve, it makes sense that the company would look to do something similar down the rate food chain.
CitizenM is more upscale while Moxy is more of a middle-of-the-road product, so the two can co-exist, noted Richard Clarke — a senior analyst covering hotels at Bernstein — noted via email.
What will be interesting to see is what, if any, changes Marriott makes to CitizenM as it scales it further. CitizenM leaders in the past have touted the brand for its “affordable luxury” that puts greater emphasis on public spaces. Marriott’s acquisition announcement flagged the deal as a continuation of the company’s expansion into limited-service and lifestyle offerings.
“As we continue to drive best-in-class experiences for travelers, today’s announcement builds upon Marriott’s commitment to enhance options for guests and Marriott Bonvoy members,” Marriott CEO Anthony Capuano said in a statement before later adding: “Marriott has a proven track record of growing acquired brands significantly by leveraging our global development ecosystem, the benefits of our industry-leading affiliation cost structure, and the power of our award-winning Marriott Bonvoy loyalty platform.”
For those keeping tabs: The CitizenM deal, slated to close later this year, would put Marriott at 37 brands (and counting).