“People were rushing to leave before they locked down the building,” a guest at a Sonder-run hotel told CNBC.
Sonder announced on Monday, Nov. 10, that it plans to file for bankruptcy, a day after Marriott International announced it was terminating its licensing agreement with the short-term rental company.
Mr. Sonder said in a news release that efforts to improve the company’s finances following Marriott’s announcement were unsuccessful, forcing the company to “initiate Chapter 7 liquidation.”
“Given the failure of these efforts and (Mr. Sonder’s) financial condition, the board has made the difficult decision to wind down the business and proceed with an immediate court-supervised liquidation of its U.S. operations,” the company said in a statement.
The move comes after Sonder and Marriott signed a licensing agreement in August 2024 that would allow Sonder hotels to be booked through Marriott’s Bonvoy website, according to CNBC and the New York Times. However, this agreement ended with an announcement from Marriott on Sunday, November 9th.
Hotel guest ‘scrambles’ home leaving letter under door
According to CNBC, guests at the Sonder Hotel were told on Sunday they had to leave their rooms within 24 hours and look for housing. One of the guests, Connie Yang, told the outlet that her prepaid stay in New York from November 7th to November 17th had been cancelled.
“People were rushing to leave before we could seal off the building,” she said.
Another guest at Sonder’s hotel, Juan Avalos Mendez, told the Times that he woke up on Nov. 10, three days into a 12-day trip to Amsterdam, to find a letter slipped under his door. The letter said the hotel would be closing and I needed to check out by 11am.
Another guest, Joanne Lee, told the Times that Marriott offered her no “real solutions” after canceling her four-night stay. She and her husband were planning to stay in an apartment in Rome after Christmas.
“It was disappointing,” said Lee, 42. “My husband is already a little unsure of Airbnb, so what we liked about it was that it had the Marriott brand on it.”
Why did Marriott terminate its contract with Sonder?
Marriott said in a Nov. 9 news release that the agreement was terminated due to “Sonder’s default.” “Sonder is no longer affiliated with Marriott Bonvoy and Sonder properties are no longer available for new reservations through Marriott channels.”
In Sonder’s news release, interim CEO Janice Sears claimed that issues with Sonder’s integration with Marriott Bonvoy’s website resulted in the company losing money.
“Unfortunately, due to unforeseen challenges in coordinating the technology framework, our integration with Marriott International was significantly delayed, resulting in significant unanticipated integration costs and a significant reduction in revenue due to Sonder’s participation in Marriott’s Bonvoy reservation system,” Sears said.
Fernando Cervantes Jr. is a trending news reporter for USA TODAY. Contact us at fernando.cervantes@gannett.com and follow us at X @fern_cerv_.
