Marriott To Stop New Timeshare Projects, Take $760 Million Charge

   DOW JONES NEWSWIRES 
 

Marriott International Inc. (MAR) said it will stop developing new residential timeshare projects as it will take nearly $760 million of write-downs in that space.

Meanwhile, fiscal third-quarter results in Marriott's North American hotels was slightly better than expected. Revenue per available room dropped 19% for the period ended Sept. 11, slightly less than the 20% to 24% drop projected.

Big hoteliers also have businesses which sell stakes in vacation rentals, generating both initial sales proceeds and annual use fees. But sales have slumped amid the recession and as developers have been building numerous projects in recent years.

Marriott said Wednesday the write-downs reflect the company's plan to cut timeshare prices and development "to accelerate cash flow." Roughly $300 million of the write-downs are at five luxury residential projects, a similar-sized write-down at nine North American fractional projects and $95 million at one other North American project.

Amid the woes in the space, Marriott said it doesn't expect "to pursue new Marriott-funded" residential timeshares, but does expect to continuing licensing and managing projects developed by others.

The company will release the quarter's results Oct. 8.

Shares closed Tuesday at $27.24 and were inactive premarket. The stock is up 41% this year.

-By Kevin Kingsbury, Dow Jones Newswires; 212-416-2354; [e-mail]