Hyatt Hotels Corp.’s M&A streak continues to be good, and the company revealed plans to add Dream Hotel Group earlier this week.
Best known for its upscale Dream Hotels banner, Dream Hotel Group’s portfolio of brands also includes the Chatwal Hotels and Unscripted Hotels concepts. The Dream Hotels brand, in particular, is known for its nightlife venues (for example, the PHD Rooftop Lounge at Dream Downtown in New York) and unique hotel designs.
The company currently has about a dozen managed or franchised properties within its stable, along with another two dozen hotels in development.
Hyatt said it has agreed to acquire the lifestyle hospitality player for a base price of $125 million, and that purchase sum could grow by an additional $175 million over the next six years as more Dream Hotel Group properties enter the market. wallet.
Robert Cole, Phocuswright’s senior research analyst for lodging and leisure travel, called the deal “a smart buy” for Hyatt.
“It gives Hyatt some great hotels in some key, critical markets,” Cole said, citing Dream Hotel Group’s presence in New York, Hollywood and Miami’s South Beach.
In particular, the addition of Dream Hotel Group is on track to increase the number of Hyatt rooms in New York City by 30%, according to Hyatt. Dream’s presence in Manhattan includes the 76-room Chatwal New York, 315-room Dream Downtown and 221-room Dream Midtown hotels.
A public space at the Dream Nashville. Photo Credit: Hyatt
Also attractive is the fact that Dream Hotel Group seems to have a long way to go for expansion.
Most recently, the company expanded its Chatwal brand with the opening of Chatwal Lodge, an 11-room, 100-acre luxury hotel in New York’s Catskill Mountains.
“The Dream Hotel brand is relatively small, but it has a good reputation, so it’s something that Hyatt can really grow, which is great,” Cole said. “There are also a good number of hotels in the pipeline, so there is already momentum in terms of development.”
Dream Hotel Group’s projects include plans for a Dream-branded hotel-casino on the Las Vegas Strip, scheduled to open in late 2024, and Dream hotels in St. Lucia and Doha, Qatar.
For Dream Hotel Group brands, meanwhile, access to Hyatt’s distribution channels and the World of Hyatt loyalty program is likely to be a boon, particularly when it comes to attracting corporate business.
“Dream may have been getting some of the small business and individual business traveler market, but I don’t know if they had a lot of big corporate deals,” Cole said. “But with Hyatt bringing its sales network and brand recognition to the table, it can help those brands better compete in that corporate market.”
An aerial view of the pool area at Dream Downtown in Manhattan. Photo Credit: Hyatt
Exactly how the Dream Hotel Group brands will mesh with Hyatt’s current lifestyle portfolio remains to be seen.
Dream, Chatwal and Unscripted will perform alongside Andaz, Alila, Hyatt Centric, JdV by Hyatt, Thompson Hotels and Caption by Hyatt.
“Everybody’s going to have to keep their swim lanes clear,” Cole said.
Cole added that there is already one potentially problematic area of overlap for Hyatt: the striking similarity between the Dream Hotels brand and the Dreams Resort & Spas brand, the latter of which joined the Hyatt ecosystem when Hyatt acquired all-inclusive powerhouse Apple. Leisure. group last year.
“I’m not sure how they’re going to figure that out or what their strategy might be there,” Cole said.
What is strategically clear, however, is that Hyatt remains focused on accelerating its growth through acquisitions and partnerships.
In addition to adding Apple Leisure Group to the mix, Hyatt significantly bolstered its lifestyle presence with the acquisition of Two Roads Hospitality in 2018 and, most recently, expanded significantly in Europe through a partnership agreement with Lindner Hotels of Germany. .
Source: news.google.com