Grand Hyatt Baha Mar Bankrupt, Hyatt Sticking It to Cancelled Guests

Stephen N. wrote to me, to Lucky, and to Mommy Points about his upcoming booking at the Grand Hyatt Baha Mar which has been cancelled.

As you may be aware, the Grand Hyatt Baha Mar has entered bankruptcy and has indefinitely postponed their opening date. How this affects myself, and other guests, is that Hyatt has cancelled our reservations (mine was for October), offering change fees as our only compensation.

I would like to pose 2 questions to you all regarding the situation… In situations such as this, what do you feel is the appropriate compensation, if at all, for guests?

The hotel will not open on time. The property is going through bankruptcy. And all Hyatt is offering, it seems, is $300 towards change fees.

As you may be aware, the ownership entity of the Baha Mar resort in the Bahamas, Baha Mar Convention Hotel Company Ltd. (Owner), recently filed for protection under Chapter 11 of the United States bankruptcy code in the U.S. Bankruptcy Court in Delaware. Unfortunately, this means that the opening of the Grand Hyatt at Baha Mar hotel will be delayed due to the bankruptcy filing. …

In the meantime, because we cannot predict the timing of the Owner’s bankruptcy resolution, we believe it would be in your best interest to re-schedule your upcoming reservation at an alternate location in order to minimize the inconvenience to you. We realize this situation may cause you airfare penalties for rescheduling and we will reimburse you up to $300.00 per person on your reservation for cancellation fees and non-refundable airfare.

I assume the role that bankruptcy plays is that Hyatt is going to wind up funding compensation itself, versus the hotel coming out of pocket to make customers whole.

In the past I’ve received a free stay in a suite at an alternate Hyatt property. I’ve also been offered the equivalent points to book a free stay later.

My mental model is that this is like a walk situation, the hotel can’t honor your reservation. Traditionally that means they cover the nights they can’t host you and if you’re an elite otherwise generous it should mean free nights as well.

Obviously change fees aren’t sufficient here (and $300 certainly not).

  • Ticket change fees are often $200 per person, plus difference in fare. Hyatt will reimburse $300 per person on the reservation though of course people don’t usually add names of all guests to their bookings, though I suppose it would be a best practice to do so.
  • Hyatt elites won’t get the same benefits at other properties, so they should be covering breakfast and a room category upgrade plus internet charges if applicable.
  • Inconvenienced customers no longer have the advantage of making advance bookings at other hotels and may face fewer choices or higher prices elsewhere
  • The hotel was a Gold Passport category 4 property, it was moved up to category 5, making future redemptions there (if anyone would be willing to go back after this) more expensive.

Here’s an interesting nugget: earlier-cancelled guests were given “options including 20,000 points per night or a discount at a nearby hotel.” As I say, I assume the difference is that the hotel owner is now in bankruptcy.

And the bankruptcy is a complicated one, with the hotel reported ‘97% complete’ and responsible for 1.5% of its country’s employment and 12% of GDP. (The project houses a Hyatt and two other brands.)

My bottom line: Customers reasonably relied on Hyatt’s representation that they would have a room, not on that of the individual property with whom they’d have an unsecured claim. If there was a failure of due diligence here, it’s on Hyatt’s part with respect to their relationship with the owner. And at least for those guests who booked through Hyatt channels, greater compensation – bending over backwards even – should be the standard. No one should have to fight for this.

Hyatt has certainly been aware of the problems with the project for some time but did not notify guests.

This isn’t just the right thing to do with respect to customers, it’s good business. Because otherwise customers should be asking themselves, if Hyatt doesn’t stand behind reservations, at what point can I trust a booking I make at

Unfortunately after a week, multiple promises for comment from Hyatt, and holding off on this post more than once pending a reply nothing from them was ever forthcoming. So I’m disappointed not just in their unwillingness to stand behind their bookings but also their unwillingness to even offer insight into or defend their actions here.

One argument for booking through online travel agency sites or through traditional agents is that there’s another party you’ve got to both advocate on your behalf and make you whole when something goes wrong. I think Hyatt is undermining the credibility of their direct booking channel.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. This doesn’t shock me. Just another reason why I don’t trust or like Hyatt. But, I agree with you that they should “cover” the reservation with a comparable property in the area for your dates, including elite benefits such as breakfast and upgrades at a minimum. $300 for change fees is not ok.

  2. I had a similar experience in relation to Hilton Cabana Miami Beach. I made a reservation at several months in advance. Some time before my stay, I received an email from Hilton, saying that they were sorry that the hotel would not be opened in time. What did they offer? An apology and to help me book a room at another Hilton, at South Beach. That’s it. I asked for points or other form of compensation, but they denied. I was HH Gold at that time (I have been avoiding Hiltons ever since).

  3. Hyatt has been better than Hilton or Marriott in the past with situations like this (I was one affected by the delays at the Andaz Maui, and was offered complimentary alternate accommodations at the Hyatt Regency or points equal to my stay length at the Andaz). However, I assume that in past situations, Hyatt and the property owner worked out who would be responsible for covering the compensation, which just isn’t possible in this situation.

  4. Unfortunately I am one of those unlucky guests. I had reservations for the second week of October and was offered no compensation in terms of points for my inconvenience. A friend had a reservation that was cancelled in June and she recieved full flight reimbursement, 20,000 points per night of her stay, and they even gave her a free stay at a different location in a presidential suite.

    Is there anything I can do to get points as compensation? I’ve spoken to reps in the “relocation” division and they are all telling me the same thing. Am I SOL?

  5. I am also one of the Unlucky Guests…. i had a reservation for the 18th of October. I called in an they offered me 3 options, i choose the third option, cancel, $300 reimbursement per person, refund of my points and 20,000 points per night compensations. I was told it would be all taken care of within 1 hours. I received my cancellation of the reservations with the points refunded. I got a email about 30 mins later that they were wrong and i was given mis information and that they would not do anything more than refund the points and $300 airfare reimbursement. I wrote them back immediately and got no response, so two days later i called them and had the issue escalated. I cannot be promised one thing and then an email later saying, were sorry nothing. Waiting for them to respond.

  6. Hi ,
    i have a simile case at the moment against the Andaz Maui. Booked a 350 square meter room. (wrong description on At the moment we are discussing what compensation is due.
    I offered to accect a villa, or they should pay my non refund. air tickets, or i will accept an downgrade to a normal room for 10 % of the price because the normal room is about 35 square meter large ;-)…..
    They are just dragging there feet at the moment and thinking about the options….

  7. This happens to me with the Holiday Inn Male. They switched owners and HI refunded points and sent us a prepaid visa for $200 towards our stay. awesome

  8. I also had reservations and was offered the same bag of coal as the others. I understand the developers went bankrupt, but Hyatt did not. Hyatt prides themselves (rightfully so) on their (usual) excellent customer service. The way Hyatt is handling this matter thus far does not meet Hyatt standards.


  9. Somewhat sympathetic to Hyatt here . . . .

    They are offering to pay $300 in change fees. If someone wants to apply their fare balance to a part of the more expensive fare to a superior location, say St. Lucia, they have a nice betterment. Otherwise, they might consider the cheap Caribbean and go somewhere comparable to Nassau, like Jamaica or Cancun . . . . or Myrtle Beach.

    And knowledge that a developer is tapped out on cash leaves Hyatt uncertain about what is happening with the project overall – they just do not know if the creditors will let the project (in which the creditors have a real interest) come to a halt or will the creditors bight the bullet and kick in ample cash to make it succeed making it more likely they will be paid some of what was financed. I just do not know when Hyatt would have had complete knowledge that the project was toast.

    What Hyatt may be doing poorly here is not using this as an opportunity to make the Zilara in Ocho Rios available. Yeah, the Zilara is all inclusive while the GH is not, but we may be talking about shoulder season bookings anyway.

  10. I can’t say I agree with all of you. These all seem to be for roughly 2-3 months out and in low season, so I would think that most would be able to pretty easily switch to another hotel. if that is the case, then a fair number of guests are looking at $300 to $1200 in compensation for something that will have little effect on you.
    This is not remotely like a walk situation. When a hotel has to walk you, the hotel has to pay, not Hyatt. it is entirely within your rights to file a claim for walk compensation with the bankruptcy trustee, as that is who would pay it if it is payable. Also, the reason they have to walk you, in pretty much every case, is that they overbooked, which is entirely within their control, or they have had an issue which shut down one or more of their rooms, which is almost always mostly within their control. This situation was not remotely within Hyatt’s control.
    In regard to the amount of compensation, yes, $200 for airline change fees (Hyatt can’t compensate everyone for changes in airfare, some may end up paying less). That still leaves $100 for other items. If you are a diamond elite, then I could see some compensation for breakfast elsewhere, otherwise, no one would have been comped breakfast. No one is guaranteed an upgrade, it is only if it is available, obviously, it is not available in this property. The rest of the suggested compensation is about mays and mights and Hyatt is not going to compensate everyone for what might go badly for some.
    If I had to guess, the $300/person compensation will probably be a straight windfall for the majority of the guests who will just move to another hotel at low rates in low season, a small profit for a few more, a breakeven even for many more, and a small loss for a few more.
    I think that most are seeing what those that were cancelled in the summer received and just looking for their shot at the brass ring, but the situation is very different now because those guests were dealing with the hotel owners and the required compensation in their contract with Hyatt, the current guests are dealing with a bankruptcy trustee.

  11. @Jennifer Horne I would read your terms and conditions of your reservation very carefully. Remind Hyatt that you have a binding contract with them. If you booked directly through Hyatt you probably have more rights than an OTA. If I were you I would demand that they “cover” a similar hotel (read: Atlantis) for your dates, including all Hyatt benefits. If it costs them more money than tough luck. The basis for this would be under contract liability theory. I wouldn’t accept any less.

    Hyatt will try to blame the hotel, but here is the thing… Hotel operators pay Hyatt for their name and customer base. Hyatt brings customers in and they should relocate customers when they lose properties.

  12. @jennifer Horne, you are incorrect as to compensation provided as to may and June cancellations. There were 3 options that persons given including getting 20,000 points per night. Not all 3 compensation you mentioned. Plus some of the options being misstated . I had reservations and took the points and simply went to the Hilton. Many people went to the Atlantis where given preferred rates. Preferred rates offered were no so great. The Atlantis is what it is, and they love to add on fees. But you are totally wrong about total compensation offered.

  13. @jr

    so you were expecting 350 square meter room? did you think you were renting the whole taj mahal? 😉

  14. Gary ,
    Thank You for the important update on the series of unfortunate events taking place with the previously expected opening of the Grand Hyatt Baha.
    Hyatt has gotten much more rigid/less flexible over the years with their Customer Relations efforts generally following somewhat down the path of airlines.
    Having said that so have most other hotel companies. Hyatt still seems to be above average overall when you look at the industry regarding resolution of issues/guest satisfaction.
    They could do more though overall IMO though to gaining greater trust amongst their membership base. Trust has been eroding as of late with a number of issues compounding in and out of program.
    My gut instinct is that the 300 dollar per person offer is more a less a blanket one size fits all to limit exposure overall that may be ok with some guests.

    My experience with these kinds of situation’s over the years is that Hyatt may look at each guest and their individual cases and might consider something in addition in select instances should the guest come forward and get the right individual speaking at/with Hyatt Consumer Relations /Guest Services. Guests will need to demonstrate more clearly their out of pocket expenses as a result of the situation and of course Hyatt Guest Relations may or may not reconsider an individual case based on a number of factors
    At the end of the day individual affected guests must have reasonable expectations for a satisfactory outcome.

    Best Regards
    777 Global Mile Hound
    Hyatt Gold Passport Ambassador

  15. Friend had 4 nights booked for September. Got up to $300 for change fee and 20k Hyatt points per night.

  16. @farnorthtrader

    “This situation was not remotely within Hyatt’s control”

    You don’t think Hyatt does due diligence and evaluates the business credentials, financing, etc of potential franchisees? I’m quite sure they do. Obviously they didn’t do it well in this case.

  17. Customers have no rights, I just got walked in a socialist scandavian country by an OTA. Did the hotel offer anything? Nope. They said talk to the OTA. The OTA said talk to the hotel they have no control of the situation even though they issued a confirmed booking in advance. Your rights in these walk situations? Nothing. Now the EU offers something. The USA, only the courts which the OTA and Hotel chains try to throw you into arbitration or site tricks and traps of the T&C to get out of the court system. The airlines have minor regulations but the Hotels are the wild west of travel. And people think that airbnb is bad, actually if you do not require the full service of a hotel I think that airbnb can be better. Nothing is guaranteed in lodging business, its not much different than mideval pubs for Christian pilgrims when you get down to it.

  18. @farnothtrader
    It’s up to $300 in change fees, receipts are required… it’s not a straight $300 compensation

  19. Why is everyone always looking for freebies? Why not just book another hotel? Why would u cancel a trip because your preferred hotel isn’t available?

  20. Hyatt cancelled our June vacation and Richard at Baha Mar was very helpful. Transferred us to the Zilara in Jamaica – standard room for 2 nights and Junior suite for 5 (we had the suite for all 7). The Zilara is an excellent all inclusive. Hyatt covered our air fare changes and gave us compensatory points as we had to upgrade one of our flight from a saver to a standard award. They also gave us compensatory points and points back under their 20% back promotion at that time. We saved money and gained points and had a great time. We will definitely stick with Hyatt and hopefully one day get to Baha Mar.

  21. We had 4 rooms all booked on points for 14 nights and one room with employee rate.. this is terrible we talked to the assistant director and still are not giving suitable compensation since we can’t re-book hotel on points anywhere else with our Hyatt points and we have our flights all booked for 12 adults and 2 infants already for a 35 year anniversary of my parents. It will be impossible to even get a remotely decent price hotel for all of us now! I hate hyatt!

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