- The Washington Times - Tuesday, August 5, 2003

The JW Marriott Hotel in Jakarta, Indonesia, remained closed yesterday after a deadly explosion tore through the ground floor of the 33-story building.

Bethesda-based Marriott International Inc., which manages the property and employs the 642 workers there, says its biggest concern now is the guests and its employees.

“We are closely monitoring the situation and are working with authorities to assure that our guests and employees are moved to safety,” according to a statement on Marriott’s Web site, www.marriott.com.

The bombing is not likely to have a dramatic financial effect on the parent company because it does not own the hotel, said Jake Fuller, hospitality-industry analyst at Thomas Weisel Partners. Marriott International operates and franchises more than 2,600 properties worldwide.

The upscale hotel in Jakarta is owned by a local businessman, not by the hotel chain, said Kess Connelly, Marriott’s manager of international public relations.

Marriott would not disclose specific security measures, saying only that it had increased security at the Jakarta property before the bombing. The Jakarta Marriott is popular among business executives, dignitaries and U.S. Embassy personnel.

“We regularly assess and adjust our security measures on a regional and local basis, and at this time, we are reviewing the need for any additional precautions,” Marriott said in its statement.

The 333-room hotel had 270 registered guests at the time of the bombing. The guests have been transferred to nearby hotels. All the Marriott employees have been accounted for, Ms. Connelly said.

The company Web site also posted a hot line for those who want to check up on guests and employees of the hotel. At least 13 persons were killed, including a security guard, and about 150 injured, including three guests and eight hotel employees.

The explosion, which occurred near the hotel’s entrance, destroyed the lobby and a ground-floor restaurant, and blew out windows. The company says it does not believe the attack was targeting the hotel, which is next to an office complex that houses large businesses and several embassies.

Marriott said it is assessing the damage and cannot determine how much money the hotel will lose each day it remains closed.

Marriott stock, which trades on the New York Stock Exchange, dipped slightly yesterday — to $40.04 per share, down 78 cents per share from Monday’s closing price.

The worldwide hotel chain made a profit of $707 million last year, a 6 percent decrease from 2001. Sales increased by 6 percent, to $18.6 billion last year.

Indonesia has two Marriott properties. The other JW Marriott Hotel is in Surabaya, the capital of East Java and Indonesia’s second-largest city, after Jakarta.

Marriott officials would not discuss specific security measures at its other hotels, but security is increased when necessary, particularly if an attack happens or the U.S. terror alert is elevated.

Indonesian Defense Minister Matori Abdul Djalil called the bombing an “act of terrorism.” The government warned recently of terrorist attacks by the Al-Gamaa Islamiya network blamed for October’s Bali bombing. Yesterday’s attack came two days before the first verdict is due in the trials of Muslim militants accused of the Bali bombing, which killed about 200 people.

“I think [the bombing] was very local and against the government itself, not against the U.S.,” said Joseph McInerney, president and chief executive of the American Hotel & Lodging Association. “I don’t think this will affect travel in the U.S. by Americans.”

However, the bombing is the latest in a string of bad news that has hit the hotel industry in the past two years, starting with the September 11 attacks and continuing through the war in Iraq and the severe acute respiratory syndrome crisis.

“Obviously, [the past two years have] had a negative impact, but it could have been a lot worse,” said Mr. Fuller, the hospitality-industry analyst, pointing out how poorly the airline industry has fared during the past two years.

Nonetheless, the hotel industry is reeling from its fair share of rough times.

“This has been the most trying time for our industry that any of us can remember,” Mr. McInerney said.

The industry’s overall profit has dropped from about $24 billion in 2000, the hotel sector’s best year ever, to $17 billion in 2001 and $16 billion last year.

The industry is projecting slightly lower profits this year, Mr. McInerney said.

The U.S. hotel industry has lost 27 percent of its international visitors since the September 11 attacks and the SARS outbreak.

This article is based in part on wire reports.

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