Hyatt has announced another round of customer-friendly moves for program members who aren’t traveling now and that improves program value for redemptions next year when demand should still be soft. They’re extending expiration of elite upgrades and various free night awards. And they’ve announced the date when they’ll roll out the peak/off-peak redemption pricing devaluation.
Suspending Points Expiration
Hyatt points already weren’t going to expire through end of year. They’ve extended the pause on points expiration through June 30, 2021. After that, at least as of now, they intend to revert to their policy of expiring points in accounts that have been inactive for 24 months. (It’s easy to keep Hyatt accounts active before expiration resumes, a simple way is transferring in 1000 points from a Chase Ultimate Rewards account.)
Extending Expiration Of Upgrade And Free Night Awards
Recently I wrote that a blind spot in Hyatt’s Covid response was expiring suite upgrade awards given to members staying 50 and 60 nights (or more) each year. The suite upgrades I earned in 2019 were slated to expire at the end of February 2021. In other words, I didn’t really get a chance to use the benefits I’d earned this year thanks to Covid. Status had already been extended for next year, just not the biggest benefit of status. As a result I predicted that Hyatt would be addressing this soon. And they have.
- Suite upgrades and club lounge upgrades expiring February 28, 2021 will be extended to December 31, 2021.
- Free Night awards earned this year with 2021 expiration dates will be extended to December 31, 2021.
Hyatt already extended suite upgrade awards expiring March 1 – December 31, 2020, and extended 2020 status through February 28, 2022.
The extension of free night awards and suite upgrades is especially useful for me, since I have a ton of each saved and I suspect I’ll be better able to utilize them next year than this.
Date Announced For Peak/Peak Award Devaluation
Now they’re sharing that this devaluation will happen July 1, 2021. You may be reading that this is Hyatt ‘putting off’ peak/off-peak even further but that’s not really correct. They said it would be sometime in 2021, and they’d give us advance notice of when. This is the promised notice about when in 2021 it will happen.
Peak pricing will be an upcharge of 1500 to 5000 points depending on the category. Off peak pricing will be a discount of 1500 to 5000 points. Here’s the new free night award chart going into effect, then, in July 2021:
And since cash and points awards are 50% of the points and 50% of the prevailing cash rate, cash and points will see lower and higher points prices on off-peak and peak dates as well. Similarly cash and points and free night awards will have peak and off-peak for club redemptions, standard suite redemptions, and premium suite redemptions. Regency Club and Standard Suite awards have the same discounts and upcharges for off-peak and peak in each category as Free Night Awards.
Hotel chains generally have to pay more to hotels for the reward nights given to members when those hotels are full. So they want to charge members more for those nights. Hotel points-earning has been revenue-based for decades (the points you earn are based on how much you spend at a hotel). Now redemption is becoming much closer to revenue-based.
Hyatt is the last major program to retain true fixed award chart pricing. That provided great value to members. When rates are low you spend cash at a hotel. When they’re high you spend points. That way you get great value for your points.
Introducing high and low season pricing (peak and off-peak) means you’re much more likely to get average value for your points relative to the cost of a room, and much less likely to get outsized value. So Hyatt’s move is a real disappointment, though it’s seemed almost inevitable that they’d do what everyone else is doing to devalue.
It’s an odd time to push forward with this, though, when there are few hotels full and it’s unlikely Hyatt is making override payments to many properties for awards on nights they’re nearly sold out. Hopefully when Hyatt advances this change more hotels will be off-peak and very few will be peak. That doesn’t seem to be how similar moves have worked out at Marriott however.
Hotel Category Changes
Hyatt promises to ‘suspend 2021 hotel category changes’ outside of ‘a few exceptions,’ which they’re sharing now. Several hotels will drop in category this month, largely focused on Destination Hotels and timeshare properties. A few will go up next March.
|Category Reductions, Effective October 29:||From||To|
|Stonebridge Inn, A Destination Hotel||5||4|
|Wailea Grand Champions Villas, A Destination Residence||6||5|
|Wailea Ekolu Village, A Destination Residence||6||5|
|Wailea Ekahi Village, A Destination Residence||6||5|
|Lichenhearth, A Destination Residence||6||5|
|Parker New York||6||5|
|Grand Hyatt Vail||7||6|
|Mauna Lani Point, A Destination Residence||7||6|
|Wailea Elua Village, A Destination Residence||8||7|
|Kaanapali Alii, A Destination Residence||8||7|
|Vail Residences at Cascade Village, A Destination Residence||8||7|
|The Lodge at Spruce Peak, A Destination Hotel||8||7|
|Category Increases, Effective Mid-March 2021:||From||To|
|Hyatt Regency John Wayne Airport||2||3|
|Hyatt House Nashville / Downtown – SoBro||4||5|
|Mar Monte Hotel Unbound Collection||4||5|
|Park Hyatt Aviara||5||6|
Oddly rather than suspending changes, this roughly represents the number of annual changes we’ve seen from Hyatt – albeit this year skewed towards more properties going down in category than going up. It’s just a small percentage of the overall portfolio that is changing though.
My own view is that redemption categories should be dropping fairly broadly across the board. Hotel average rates determine reimbursement paid by the chain, and therefore the points World of Hyatt charges members. Facing the worst times in the industry’s history, we should be seeing major downward revision in hotel categories. Hyatt’s redemption structure is most similar to how Starwood’s used to work, and Starwood didn’t reduce its hotel categories after a disastrous 2009 either.
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