Marriott Partner Goes Bankrupt and Strands Guests in 37 Cities

Sonder Files for Chapter 7 Bankruptcy

On November 9, 2025, Marriott International terminated its licensing agreement with Sonder Holdings, the company operating nearly 10,000 apartment-style hotel units under the Marriott Bonvoy brand.

The next day, Sonder announced it would immediately shut down and file for Chapter 7 bankruptcy.

Guests in 37 cities across 10 countries woke up to emails telling them to leave. Some had hours. Others had minutes.

The collapse became the largest hospitality bankruptcy since the pandemic, and the fallout is still unfolding.

Guests Given Hours to Leave

Travelers staying at Sonder properties received emails late Sunday night informing them that the Marriott agreement had ended.

The messages instructed guests to check out by Monday morning.

One couple on an anniversary trip in Montreal was given just 15 minutes to vacate. An NYU professor in New York initially thought the email was a phishing scam.

A guest in Philadelphia who had booked five months for work found herself scrambling to find housing while neighbors helped a man undergoing cancer treatment figure out where to go next.

Belongings Packed Into Hallways

Paul Strack, visiting Boston from Arkansas with his family, ignored what he assumed was spam. When they returned from sightseeing Monday evening, their room door was wide open.

Staff had packed their belongings into suitcases and left them in the hallway. Even dirty laundry and toiletries were bagged up.

Laptops sat in plastic bags on the floor.

The family ultimately spent their final night in the same room they had been kicked out of, because no one was left to enforce the eviction.

A College Dorm Idea Gone Global

Francis Davidson was a 19-year-old economics student at McGill University in Montreal when he started subletting his apartment to vacationers in 2012.

That first summer, he made about $14,000 on rent he paid roughly $5,000 for.

He began managing other students’ apartments, then recruited his friend Lucas Pellan to build a booking website.

They called it Flatbook. By 2014, they had dropped out of school, hired staff, and expanded to 11 cities.

The company eventually rebranded as Sonder.

From Startup to Billions

Sonder raised millions in venture capital and moved its headquarters to San Francisco in 2016.

The company hit a $1 billion valuation by 2019 and went public in January 2022 through a merger with a special-purpose acquisition company.

At its peak, Sonder managed over 9,000 units in more than 40 cities across 10 countries, including London, Dubai, and major U.S. markets.

Forbes named Davidson to its 30 Under 30 list. The pitch was simple: apartment comfort with hotel reliability, all managed through an app.

Marriott Offered a Lifeline

In August 2024, Sonder signed a 20-year strategic licensing agreement with Marriott International.

The deal added Sonder properties to the Marriott Bonvoy loyalty program, giving the struggling company access to over 210 million members and global marketing muscle.

Marriott provided $15 million upfront. Sonder expected the partnership to deliver major revenue growth and cut customer acquisition costs.

Full integration with Marriott’s booking platform was scheduled for 2025. It looked like the rescue Sonder desperately needed.

Tech Systems Never Clicked

The integration turned into a disaster.

Sonder blamed unexpected challenges aligning its technology with Marriott’s booking and reservation platforms.

The delays caused costs to spike and revenue to drop. Bookings that once flowed through Sonder’s own channels shifted to Marriott’s system, but the handoff was messy.

Interim CEO Janice Sears later said the company faced a sharp decline in revenue directly tied to participating in the Bonvoy reservation system.

What was supposed to save the company helped accelerate its collapse.

$101 Million Loss in Six Months

By mid-2025, Sonder was in freefall.

The company reported a net loss of $101 million for the first half of the year, a 469 percent drop compared to the same period in 2024.

Its stockholder deficit exceeded $715 million. In October, Sonder warned investors it had substantial doubt about its ability to continue operating.

Founder Francis Davidson stepped down as CEO in June. The company postponed its shareholder meeting. Nasdaq sent a delisting notice.

Sonder was running out of time, money, and options.

Marriott Says Sonder Made Threats

Court filings painted an ugly picture of the final days.

Marriott alleged that Sonder executives demanded up to $50 million in emergency funding while threatening to strand thousands of guests if the hotel giant refused.

According to Marriott’s attorneys, Sonder tried to use guest safety as a bargaining chip. Marriott declined to pay.

On November 9, it announced the licensing agreement was terminated due to Sonder’s default. Sonder also owed Marriott roughly $17.7 million in unpaid fees.

Refunds Became Another Battle

Marriott initially told displaced guests that refunds for prepaid stays would be processed automatically. Days later, the company reversed course.

Because Sonder, not Marriott, had processed the original payments, travelers were told to pursue chargebacks through their credit card companies.

Guests who booked through third-party sites like Expedia or Booking faced even more uncertainty. Many reported waiting on hold for hours without resolution.

Landlords and Workers Left Behind

The collapse did not just hurt guests.

Sonder leased most of its properties from landlords under long-term master lease agreements. Those property owners were suddenly stuck with vacant units and unpaid rent.

In New York, the Moinian family sued Sonder for at least $10 million, alleging the company abandoned two buildings mid-crisis.

Employees across the company lost their jobs overnight with minimal warning.

Some staff members were reportedly in tears as they helped clear out guests from buildings they no longer worked in.

A Warning About the Franchise Model

The Sonder disaster exposed a gap many travelers never think about. When you book through Marriott, you assume Marriott runs the property.

But licensing agreements mean third-party operators can use the brand name while handling everything from booking to housekeeping.

If that partner fails, Marriott’s logo offers no protection.

Industry analysts say this collapse will force hotel companies to rethink how they vet partners. For guests, the lesson is simpler: the name on the door does not always mean what you think it means.

This article was created with AI assistance and human editing.

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