The news of Hyatt Hotels takeover talks for Starwood Hotels had me thinking about how the two hotel chains compare for hotel brands, number of hotels in each brand and average daily rates for each brand.
Here are tables I made from the most recent Third Quarter 2015 Financial Statements for each hotel chain.
Hyatt Hotels by the Numbers
Hyatt Hotels Financial Statement Q3 2015
Starwood Hotels by the Numbers
Starwood Hotels Financial Statement Q3 2015
Some things stand out in the data. The systemwide average daily rate (ADR) is similar for these two hotel chains with Starwood at $172.39 compared to Hyatt at $181.91.
A combined chain would have five hotel brands in the upscale market segment as defined by STR with Aloft, Element and Four Points from Starwood (323 hotels) and both Hyatt Place and Hyatt House (299 hotels).
The combined hotel chains offer a large selection of upper upscale hotels with Sheraton (441 hotels), Westin (204 hotels) and Le Meridien (102 hotels)brands from Starwood Hotels. These are valuable additions for Hyatt to boost its upper upscale market segment hotels when added to Hyatt Regency (155 hotels).
The luxury market segment is well-represented in both hotel chains currently and a combined chain with several luxury brands will be a formidable competitor to Marriott and Hilton. Starwood has St. Regis and Luxury Collection (135 hotels) and (W 46 hotels). Hyatt has Park Hyatt (36 hotels), Grand Hyatt (44 hotels) and Andaz (12 hotels). This is 170 Starwood and 92 Hyatt. Luxury hotels are a small proportion of the overall hotel market at less than 8% of hotels. Hyatt-Starwood combined would be a chain with around 15% luxury hotels.
Throw in Hyatt Ziva and Zilara all-inclusives, Hyatt Centric and Starwood Tribute Portfolio into the mix and there are even more high-end hotels. I’m not really sure where Hyatt Centric falls into the chain scale since there are only two hotels?
A combined Hyatt-Starwood chain would strengthen Hyatt Hotels position in the upper upscale hotel market and expand the Hyatt chain’s international presence quickly with Starwood’s more geographically dispersed hotels.
At the upscale market segment, Aloft and Four Points have lower average daily rates than Hyatt Place or Hyatt House. This could be good news for Hyatt Gold Passport members like me who find the average Hyatt rates are getting too high for a leisure traveler.
Will a merger mean those rates at Aloft and Four Points grow more quickly to the level of Hyatt Place? Hotel owners would like to see that scenario.
Of course, the primary interest to loyalty travelers is whether a combined Hyatt-Starwood Hotel chain will bring devaluations to the value of hotel points and hotel stay benefits.
That is a question to examine if and when there is an official announcement that Hyatt Hotels is buying out Starwood Hotels.
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