Sonder to file for bankruptcy. Travelers told to leave hotels next day
Short-term rental company Sonder said it plans to file for bankruptcy on Monday, a day after Marriott International announced the end of a licensing agreement between the two companies.
to agreeThe deal, signed in August 2024, allowed Sonder hotels to be booked through Marriott’s Bonvoy website and was widely seen as a lifeline for the San Francisco-based company, which is struggling financially amid the Covid-19 pandemic and after going public via a SPAC merger in 2022.
One expression In an article published Sunday, Marriott said the 20-year license agreement is “no longer in effect,” citing Sonder’s “case of default.”
In a statement Monday, Sonder said the company had made “extensive efforts” to improve its financial situation following Marriott’s announcement, but that had not yielded results.
“In light of these failed efforts and [Sonder’s] “Given the financial situation, the Board of Directors has made the difficult decision to cease operations and immediately initiate a court-supervised liquidation of the U.S. businesses.” expression To read.
Janice Sears, Sonder’s interim CEO, said technical integration issues with Marriott’s Bonvoy website caused “significant, unforeseen integration costs as well as a sharp decline in revenue.”
“We are devastated that we have reached a point where the only viable path forward is divestment,” Sears added.
Unicorn of once valuable The company, which was valued at $1.9 billion in its IPO, said it plans to file for bankruptcy abroad.
The company, which operates in 40 cities around the world, is billed as a hybrid of Airbnb and hotels, offering extended stays in tech-enabled properties popular with remote workers. The company operated many hotels through long-term leases, resulting in an “asset-heavy” strategy that many in the hospitality industry now avoid.
‘People were mixing with each other’
Sonder hotel guests interviewed by CNBC said they were caught off guard by this news, and some said they were ordered to vacate their hotel rooms less than 24 hours ago.
A traveler named Connie Yang told CNBC that she pre-paid to stay at Sonder Battery Park in New York from November 7 to November 17.
He said he received an email on Sunday, November 9, saying he had to vacate the hotel by 9 a.m. the next day.
“The reason given was that the licensing agreement between Sonder and Marriott had expired,” he said. “The entire building was asked to be evacuated.”
“My neighbor is helping her husband with his cancer therapy and they paid for this month’s payment as well,” she added. “Incomprehensible.”
He also described finding some of Sonder’s field workers in tears because they “didn’t know anything.”
On Monday morning, “people were scrambling to leave the building before it locked up,” he said.
Other travelers also sent messages stories on social media about Sonder’s closure, including attempts to get help from Marriott’s customer service.
Yang said he also contacted Marriott. “I called and talked to Marriott. [a] “We all had to fight,” said the supervisor, who told us they weren’t allowed to give us better rates and couldn’t find us a room.
Marriott did not immediately respond to CNBC’s request for comment.
A. company statement He said Sunday that Marriott’s “immediate priority is to support guests currently staying at Sonder properties and guests with upcoming reservations,” adding that Marriott will reach out to guests who “booked directly through Marriott channels.”
Yang, who made his accommodation reservation through Booking.com, said a representative on the platform “assured me that I would receive a refund.”
He said he eventually found alternative accommodation on his own: at the “Hilton.”
