Owners of hotels hit by Boston strike enjoy hefty profits
The union that went on strike at seven Boston hotels faces a convenient target: Marriott International, the world’s largest hotel company.
Unite Here, represented in Boston by Local 26, knows Marriott earned some $1.4 billion in net income from its global empire in 2017, its first full year with the Starwood hotel group in its fold.
But Maryland-based Marriott isn’t the only company raking it in from the Boston hotels. The actual owners of these Marriott-managed properties get a big piece, too. The operating profits from four of the seven Marriott hotels are public record: They’re owned by real estate investment trusts, publicly traded firms that disclose financial data about their holdings.
Host Hotels owns the city’s biggest hotel, the Sheraton Boston in the Back Bay. The 1,220-room hotel generated $28.4 million in operating profit, as defined in accountant-speak as EBITDA, last year. The Westin Copley was more lucrative for LaSalle Hotel Properties ($31.5 million). The Westin Waterfront was Diamondrock’s most profitable hotel in its nearly 30-property portfolio ($28.8 million), and Pebblebrook reported $9 million in profits from its smaller W Hotel here. In at least two places, profits fell from 2016, but not by much.
Representatives for the owners either didn’t return calls or declined to comment. Marriott issued its standard response, saying its “economic proposal” matches the terms in the last contract, which included pay increases, and that it hasn’t proposed changes to health or retirement benefits.
But the status quo isn’t good enough for Local 26, whose rallying cry is “one job should be enough.” Local president Brian Lang says the union seeks several contractual changes to help ensure the 1,500 workers on strike can earn enough to live here with their hotel jobs alone. That means going beyond bartering over wage hikes.
For example, Lang is concerned about Marriott’s “Green Choice” program, which incentivizes visitors for skipping housecleaning.
He says it enables Marriott to cut costs and shift cleaners into part-time status. (Host Hotels, in particular, has praised Green Choice for improving labor efficiencies.) Lang also wants Marriott to offer a health care program for retirees; many cleaners work into their 70s just to hold onto insurance. And he says the pay increases offered are actually lower than in the past, on a percentage basis.
The two sides met with a federal mediator on Tuesday, Lang says, but had no luck coming to terms, so hundreds of union members marched across downtown Boston on Wednesday in protest.
Meetings and events are starting to be postponed and moved to strike-free hotels. Boston was the first place, but now 7,700 Unite Here members in eight US cities are on strike. Lang still hopes for an agreement that could set a new standard for other hotel workers — despite the lack of progress.
The hotel owners’ windfall isn’t lost on Lang and his team. When tens of millions of dollars leave town to Wall Street investors every year, it’s hard to blame him for wanting his union’s members to share in that success.