Hyatt Reservation Issue

I have a story to share with you all, which is a story about a recent Hyatt service issue. This is a more unusual issue, that I don't expect happens often. I thought it would be helpful to share in case anyone else runs into a similar issue. There is no clear process or compensation for the issue that I experienced. I will share how I navigated the conversation. Here at ToP, we are big fans of the World of Hyatt program. They offer a typically reliable hotel & customer service experience. The resolution I reached upheld that image of Hyatt, but it wasn't without a bit of effort on my part. Let's dive in and you can let me know your thoughts.

Hyatt Regency Osaka Reservation

Back in October of 2022, I made a booking for the Hyatt Regency Osaka. The booking was for my impending July 2023 trip to Japan. The only problem is: As of the writing of this article, there is no longer such a thing as the Hyatt Regency Osaka. That is because a group called Seibu Prince Hotels purchased this particular location on June 30, 2023, and withdrew it from the World of Hyatt program. The hotel now goes under the monicor “Grand Prince Hotel Osaka Bay”. In fact, until just this year, this change left Hyatt without a single location in Osaka. That is, until June of this year (2024) when Hyatt opened a Caption by Hyatt hotel in Osaka.

How Did this Happen?

Before I explain how I resolved this issue, I'll start by mentioning why this happened and how hotel brands work. Often, branded hotel locations are independently owned franchises. Hotel chains such as Marriott, Hilton, Hyatt and the like all operate this way, with many operators simply being franchisees. These franchisees own a hotel location, and buy into the hotel brand of say Hyatt. They do so to benefit from their marketing, booking platform, loyalty program and guests. When a franchise location decides to be apart of a brand, they must adhere to that brands requirements. These requirements often include branding / signage requirements, adhering to the terms of the loyalty program, amongst other notable things.

Because of this, it is not too uncommon to see a franchisee leave a brand. For strategic reasons, a franchisee may decide they no longer want to participate in a hotel program such as Hyatt, and they decide to pull out. That is the case with what happened here with the Hyatt Regency Osaka. The property was sold to a new owner, that no longer wanted to participate in the World of Hyatt program.

The Notification of Change

I was first notified of the change on April 24th, 2023 via email. In this email, it mentions the change in ownership and that it will no longer be affiliated with Hyatt. The email in its entirety is shown above. The message itself is extremely vague, and doesn't explain what will happen to my reservation. The concerning words however, were “Beyond July 1, 2023, World of Hyatt members will not be eligible to receive or redeem World of Hyatt program benefits”. This sentence in particular gave me some doubts about my reservation, since I had used points to secure my reservation to begin with. By implying that after July, Hyatt members would not be eligible to redeem their points for a stay, expresses that my reservation wouldn't be upheld. I reached out to Hyatt to find out the status of my reservations.

Hyatt's First offer of Compensation

When I reached out to Hyatt, I was informed that my reservation would not be honored, due to the new ownership not accepting points reservations from Hyatt. They would have honored cash rates that were previously booked through Hyatt. Instead, Hyatt's first offer was to compensate me 10,000 points for the inconvenience. This offer was reasoned off of the cost to re-accomodate me at the nearby Hyatt Place Kyoto, which was 10,000 additional points for my dates. Thinking of what I felt would be fair, I felt this first offer felt a bit short. My intention to visit Osaka was to see that city, and being moved to Kyoto wasn't going to help me visit Osaka. Further, I knew that since I had a reservation and Hyatt wasn't going to be able to fulfill that reservation, that they could do a bit better.

Related: What Are You Really Owed When Things Go Wrong? Our Travel Compensation Tips

My Counter Offer & Hyatt's Second Offer

I countered Hyatt by explaining that our goal was to visit Osaka. Deciding to shoot my shot, and be a bit bold in my counter offer, I turned up the heat. I asked to either by accommodated at the Park Hyatt Kyoto or to receive 40,000 World of Hyatt points. Now you may feel that I am a bit crazy for asking to be accommodated at a Park Hyatt for a stay that was originally in a Category 2 property, but you miss 100% of the shots you don't take!

Where we landed, I felt was a happy medium compromise. Again, basing their compensation on comparable properties, Hyatt counted with the Hyatt Regency Kyoto. Hyatt's second offer was 25,500 points as compensation in order to cover the difference in the two properties. I value my Hyatt points at around 2 cents per point, so I saw this offer as worth around $510 in compensation. I felt this was much more generous than their first offer, so I agreed to take this second offer.

Negotiating With Hyatt for Compensation: ToP Thoughts

This is a bit of an unusual issue. While I hope no one has to deal with this issue, it is good to know that Hyatt is willing to take care of its members when this happens. Because hotels are often independently owned, it is fairly common for a hotel to pull out of a chain. Travelers that run into this issue should evaluate what compensation they feel is fair. And know that the first offer isn't always the last offer. I felt the compensation I received was fair, and all's well that ends well. Have you ever run into a similar issue? Let us know over in the ToP Facebook group.