US: Marriott International has reached an agreement to acquire the lifestyle hotel brand citizenM for $355 million, including related intellectual property.
The closing of the transaction, which is expected in 2025, is subject to conditions including US regulatory approval.
When complete, the citizenM portfolio will join Marriott’s system with the hotels owned and leased by the brand subject to new long-term franchise agreements with Marriott.
citizenM may receive earn-out payments up to $110 million based on future growth of the brand over a specified, multi-year timeframe. Payments would not begin until the fourth year following closing.
Stabilised fees for the open and under construction pipeline portfolio are anticipated to be approximately $30 million annually. The global citizenM portfolio currently features 36 open hotels comprising 8,544 rooms, with three under construction anticipated to open by mid-2026.
“As we continue to drive best-in-class experiences for travellers, today’s announcement builds upon Marriott’s commitment to enhance options for guests and Marriott Bonvoy members,” said Anthony Capuano, president and CEO of Marriott International.
“We are thrilled to add citizenM as a unique, differentiated offering to our select-service brand portfolio as we continue to strengthen Marriott’s foothold in this valuable market segment around the world. 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,” he added.
Rattan Chadha, founder and chairman of citizenM, said: “We are very excited about our agreement with Marriott and look forward to this pivotal next step for our future growth. I envisage this relationship will greatly enhance citizenM’s global reach and brand impact. Marriott as an organisation shares our values and culture, and I am confident in their deep commitment in continuing our brand’s DNA into the future.”
Lennert de Jong, CEO of citizenM, said: “I am excited about citizenM’s future with Marriott International. citizenM was created for frequent travellers, and Marriott’s distribution capabilities will allow us to welcome new modern guests. With the strength of Marriott’s development engine, we look forward to the prospect of many additional citizenM properties in new destinations around the world. We will continue to own our real estate and operate all our hotels. This relationship will allow us to work together to maximise returns.”
Morgan Stanley & Co. International plc and Eastdil Secured acted as financial advisors to citizenM.
In March 2024, it was reported that citizenM was exploring a potential sale of the business and confirmed to BHN that the company was looking for “new growth capital”.
Key takeaways:
• Marriott International is set to acquire the citizenM brand for $355 million with the transaction expected to close in 2025 pending regulatory approval.
• citizenM will enter into long-term franchise agreements with Marriott when the transaction completes.
• The brand’s current portfolio includes 36 open hotels (8,544 rooms) with three more properties opening by mid-2026.
• Based on brand growth, citizenM could earn a potential of $110 million after the fourth year post-transaction.
