As the 2023 NYU International Hospitality Industry Investment Conference kicked off in New York City, Marriott International announced plans to further expand in the affordable midscale lodging segment, following its recent entry into the segment with City Express by Marriott in Latin America.
The new brand, which has not yet been named, is currently being referred to as Project MidX Studios. The affordable midscale extended-stay brand is intended to deliver a "reasonably priced" option for longer stay accommodations in the U.S. & Canada.
Project MidX Studios is meant to reflect the company’s experience and learnings from its guests, owners and franchisees. In a statement, the company said the brand would reduce "building and operating costs for owners and franchisees."
“With Project MidX Studios, we are focused on enhancing the breadth of our portfolio through the creation of a product specially designed for the affordable midscale extended stay tier—from the physical product to the operating model," said Leeny Oberg, chief financial officer and executive vice president, development for Marriott International. "The team created Project MidX Studios to reach both new customers and new markets. We are excited to join forces with Concord Hospitality and Whitman Peterson on our first three projects and are in discussions with owners for more than 250 new development opportunities under this brand.”
“Based on everything we’ve seen and heard, our team is excited about Marriott’s entry into the affordable midscale segment, where Concord has been engaged for many years,” said Mark Laport, president and CEO, Concord Hospitality. “In collaboration with Whitman Peterson, we expect to break ground on three Project MidX Studios this year, with anticipated openings in late 2024 or early 2025. Marriott’s track record in extended-stay and strong owner value proposition are compelling and driving our interest in growing this brand within our portfolio.”
Appealing to Owners
Marriott expects Project MidX Studios to be the company's "most affordable cost-per-room product in the U.S. & Canada." The brand was designed to enable accelerated speed-to-market with a low cost to build. The prototype model targets a build cost of $13 million to $14 million, requiring approximately 54,000 square feet of total building area for 124 studios. The brand is also expected to have a light operational cost model for owners and franchisees.
“Marriott has been working closely with owners and franchisees to develop a product that has a compelling value proposition and a highly efficient operating model,” said Noah Silverman, Marriott International’s global development officer for U.S. & Canada. “With trends towards longer-stay travel and increased work flexibility, Marriott is utilizing its experience in extended stay to deliver a fresh solution to meet the needs of a growing customer base, backed by Marriott’s powerful demand engines and revenue systems. With our plans for Project MidX Studios, we will have an extended stay product in every lodging tier—from affordable midscale to upper upscale and luxury—for our customers and our owners and franchisees.”
Appealing to Customers
Marriott is developing Project MidX Studios to have a "streamlined, light-touch digital-first operating model" with conveniences like pay-and-go retail and check-in with Marriott Mobile Key. The brand is designed for stays of 20 nights or more with an average daily rate of around $80 per night, depending on the market and demand.
The brand's suites will have both single or double queens, in-room kitchens and closet space. They will include on-site guest laundry, gym and pet-friendly facilities.