One Hyatt Hotel Makes 3 Times as Much from a Cash and Points Booking as a Paid Room

One Mile at a Time and Running With Miles wrote about the new “Hyatt affiliate hotel” the Hotel Levent Istanbul (formerly Marriott Edition).


Credit: Hyatt

It’s a category 7 redemption in the Gold Passport program. That means free rooms cost 30,000 points per night.

That’s the highest redemption category, encompassing properties like the Park Hyatt Sydney, Park Hyatt Vendome Paris, and Park Hyatt New York.

And what’s bizarre here of course is that the room rates at this hotel are… not exactly in that league at all.

Granted this is for a night in February, but come late spring rates are still below $200. And not just because of turmoil in Turkey (they could rename the property the ‘July 15 Heroes of Democracy Hotel’ and fire all the workers are suspected Gülenists I suppose). But because it’s in Turkey and not the Four Seasons (which can pull $250 – $300 rates in off season) or St. Regis (which manages rates of $200) either — neither of which would normally justify a category 7 redemption.

  • Hyatt compensates hotels for award nights based on their average daily room rate

  • So the more Hyatt has to pay, the more points they generally charge members.

I believe Hyatt has 20 ADR ranges for determining hotel reimbursements on free night awards, they do not correspond directly to redemption categories (some hotels are even under-categorized, for instance the Park Hyatt Hadahaa Maldives which in-season can pull $1200 a night, is only category 6).

A hotel with $200 average rates might receive $70 for an award night, while a hotel with $600 average rates might receive $300.

Surely Hyatt cannot be compensating this hotel over $200 per night for an award room, putting it the top quartile of reimbursements, that might somehow warrant a category 7 redemption.

What’s strange is that I do not even see standard room awards available at the property for 30,000 Gold Passport points. Instead I see only cash and points available and showing just the cash component and not the points on a cursory search.

Even so, a member would pay US$282 (surely a currency conversion issue since category 7 cash and points is supposed to have $300 as the cash component) rather than buying the room outright for half as much!

And a normal category 7 cash and points has the member paying $300 and cash coming to the hotel from Hyatt perhaps another $120. Category 7 makes a cash and points room worth three times as much as a paid room for this hotel during the off season!

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 InsideFlyer.com, 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 »

More articles by Gary Leff »

Comments

Leave a Reply

Your email address will not be published. Required fields are marked *