Hyatt is betting on luxury travel with $2.7 billion resorts deal

Penni Schewe

CNN, CNNBUSINESS, WPIX

By Hanna Ziady, CNN Company

Hyatt is increasing its attain in luxury resorts, betting that pent-up demand pursuing the pandemic will improve need for upmarket leisure journey.

The US resort team said in a assertion Sunday that it has agreed to get luxurious resorts operator Apple Leisure Team from non-public fairness firms KKR and KSL Capital Companions for $2.7 billion.

The acquisition will double Hyatt’s world-wide resorts footprint and make it the most significant operator of luxury resorts in Mexico and the Caribbean. It will also prolong its presence into 11 new markets in Europe, “a crucial region for international growth in leisure travel,” Hyatt stated.

The offer is the latest move by an international lodge chain to develop in luxurious travel, which is primary the industry’s restoration subsequent the coronavirus pandemic, according to vacation research corporation Skift. InterContinental Lodges Team — which also operates chains including Crown Plaza and Holiday Inn — past week announced designs to launch a new “luxury and lifestyle” brand name, expanding its portfolio of significant-close resorts.

Demand for leisure is predicted to outstrip organization travel coming out of the pandemic, as lots of firms keep on with distant doing the job. Higher stages of excessive cost savings, especially among rich households, are also predicted to increase spending on vacation.

“The journey industry is now, in influence, a leisure marketplace,” Accenture’s European head of travel and hospitality, Miguel Flecha explained in a the latest report. “Travel providers will need to reposition them selves for the publish-pandemic current market by activating a new method based mostly on leisure vacation.”

Apple Leisure Team manages the greatest portfolio of luxury all-inclusive resorts in the Americas — which includes brands such as Zoëtry and Secrets and techniques Resorts & Spas — as perfectly as Alua Lodges & Resorts, which is increasing in Europe.

The company’s resort portfolio has grown from 9 resorts in 2007 to about 100 qualities and 33,000 rooms in 10 nations around the world, with a massive selection of more lodges in development.

Hyatt CEO Mark Hoplamazian explained the offer would enable “transform” the hotel group’s earnings profile.

The organization aims to deliver 80% of its revenue from management costs, as opposed to owning hotels, by the stop of 2024. It expects to provide $3.5 billion of hotel real estate about the subsequent a few decades, which include $1.5 billion of houses this year.

“[Apple Leisure Group’s] portfolio of luxurious brands, leadership in the all-inclusive phase and big pipeline of new resorts will prolong our arrive at in present and new marketplaces, like in Europe,” Hoplamazian stated.

The-CNN-Wire
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