The possibility that the owner of the 1,408-room Philadelphia Marriott Downtown wants to sell it is raising eyebrows.
The hotel is attached to the underperforming Convention Center. Some industry observers say the center's slack bookings for the next few years likely will factor in a decision by Host Hotels & Resorts Inc. of Bethesda, Md., on whether to put it on the market.
The recently expanded center has failed to attract big-time convention groups. Its board is expected to vote Wednesday whether to hire a company to manage it.
Citywide convention and group-meeting hotel-room nights year-to-date have decreased 3.6 percent from 2012. Room nights by groups that utilized the Convention Center and were booked by the Philadelphia Convention and Visitors Bureau were down 12.4 percent year-to-date from 2012.
Host did not immediately return calls for comment. The Marriott's director of sales and marketing, Tim Haggerty, said Tuesday: "Host is in the process of evaluating whether to put the hotel on the market or not. They are doing their due diligence."
He added: "Over half of the hotel's revenue is generated through meetings and conventions. Certainly the success of the Convention Center, and the ability . . . to bring citywide conventions, is integral to the overall success of the hotel in the long run."
The hotel opened in January 1995. Though Host is its third owner, Marriott International has managed it the whole time and "will continue to do so moving forward regardless of the potential sale," he said.
The hotel will run at an all-time-high occupancy this year, Haggerty said, through a combination of group customers here for conventions and corporate and leisure travelers.
"As an anchor hotel for the Pennsylvania Convention Center, the Marriott Downtown is obviously important in meeting the demands of conventions and groups," said Jack Ferguson, Philadelphia Convention and Visitors Bureau president and CEO. "But, regardless of this sale, it is business as usual."
C. Patrick Scholes, a lodging analyst with SunTrust Robinson Humphrey Inc., said in an e-mail: "Host typically sells assets for several reasons. These reasons typically include concerns over the long-term demand growth of the market, potential for new supply [competition], which would subsequently hurt revenues, and if the property is in need of renovation."
Real Estate Alert, a commercial-property newsletter, reported recently that Host hopes to fetch as much as $325 million for the Marriott Downtown, more than triple the price paid in any previous Philadelphia hotel resale.
Host owns upscale hotels, mostly in the United States. It also owns the Philadelphia Airport Marriott.
The Marriott Downtown opened with about 1,200 rooms in January 1995 and expanded to 1,408 rooms in 1999 by converting part of the Reading Terminal headhouse. It was last renovated for $54 million in 2011.
"As a group-oriented hotel, the Marriott's location is excellent, particularly as it is physically attached to the Convention Center, which meeting planners and attendees find a huge plus in a Northeastern city like Philadelphia," said Peter Tyson, vice president of PKF Consulting USA.
In January, Host sold the 1,663-room Marriott Marquis in metro Atlanta for $293 million.
"I tell my staff [that] with that sale, it did not cause a change in management or a disruption in service to what the guests receive," Haggerty said. "It would be similar to a sale here of the Marriott."