Marriott International has reached an agreement with Mexico-based Hoteles City Express to acquire the City Express brand portfolio for $100 million.
The portfolio includes 152 midscale hotels representing 17,356 rooms across 75 cities in Mexico and three additional Latin American countries, according to a news release. Marriott will also acquire the franchising rights to five projects with 676 rooms in the pipeline that are currently under construction. The deal will mark Marriott's 31st brand.
Hoteles City Express’ brand portfolio includes the City Express, City Express Plus, City Express Suites, City Express Junior and City Centro brands. Marriott intends to update the brand with its signature “by Marriott” endorsement. The deal also includes the City Premios loyalty program.
The transaction is expected to make Marriott the largest hotel company operating in the Caribbean and Latin America by increasing its presence there by 45% to 486 properties in 37 countries.
"This transaction with Hoteles City Express is a strategic win for Marriott and our customers, associates and owners and franchisees," Marriott CEO Tony Capuano said in the release. "We're excited to enter a new lodging category — the popular affordable midscale segment where we see significant potential. With City Express by Marriott, we will be providing our customers with more choice through a new, approachable, moderate-priced offering, increasing opportunity for owners and franchisees as well as associates."
Founded in 2002 by CEO Luis Barrios, Hoteles City Express has a portfolio of midscale hotels with urban, suburban and extended-stay properties in Mexico, Costa Rica, Colombia and Chile.
"When we started thinking about City Express, we were convinced that a modern, efficient, and affordable brand would be very attractive to the local traveler,” Barrios said in the release. “After our first 20 years, we are very excited and honored to work alongside Marriott, a company we've always admired, to take the brand to the next level. After having the opportunity to work with the Marriott team, we confirmed that we share common cultural values and a similar approach to hospitality."
The deal is expected to close between the end of 2022 and the first half of 2023 after going through customary conditions and receiving approval by Mexico’s Federal Economic Competition Commission.