Sonder’s Bankruptcy Leaves Guests Stranded Amid Sudden Closure

NEW YORK — Patrick M. D’Aoust didn’t expect his anniversary trip to end abruptly. He was staying at a Sonder property in Montréal, Canada, when he received alarming news late Sunday afternoon: he had to vacate his room by 9 a.m. the following day. The short-term rental company had suddenly collapsed, leaving many guests without accommodations after its licensing agreement with Marriott was terminated.

According to sources, Sonder, once considered a major competitor to Airbnb, faced severe financial difficulties that led to the abrupt end of its partnership with Marriott. A spokesperson for Marriott confirmed that the 20-year licensing agreement was under threat due to Sonder’s “default,” prompting the immediate liquidation of the company.

“I asked the staff if we could stay until our checkout at 11 a.m., but they told me we had only 10 to 15 minutes to leave,” D’Aoust recounted, expressing frustration over the sudden notice. He emphasized his gratitude that he only lost one day of his trip.

In a similar thread, Paul Strack, 63, traveling from Little Rock, Arkansas, received an email from Marriott about his reservation. Mistaking it for a scam, he ignored the message. Upon returning to his rented space, he found his belongings packed and left in a hallway, including his family’s dirty clothes and laptops in plastic bags.

“It was shocking to see our things like that,” Strack said, indicating his disappointment with the situation. “We spent our last night back in our original room, even though we were not supposed to be there.”

Sonder announced on Monday that it would wind down operations immediately and file for Chapter 7 bankruptcy. The interim CEO, Janice Sears, expressed regret over the outcome, stating that challenges integrating with Marriott’s systems significantly impacted their revenue and overall financial health.

“We are devastated to reach a point where liquidation is the only viable path forward,” Sears noted. “Unfortunately, our integration with Marriott was delayed and led to unexpected costs.”

Marriott has communicated it is supporting guests affected by this shutdown, working to find alternative accommodations for those with existing bookings. However, many stranded guests expressed frustration over the lack of effective communication and assistance.

This development raises concerns within the hospitality sector, spotlighting the risks of licensing agreements with financially unstable partners. The rapid downfall of Sonder serves as a reminder of how precarious such business arrangements can be.