Over time it’s pretty standard for hotel loyalty programs to raise the number of points required for a free night redemption. This is done in one of two ways:
- Adjusting which hotels belong in which categories. Hotel chains typically have somewhere between a handful and a dozen “categories” of properties, which determine the price of a redemption. In many cases we simply see more hotels creeping into higher categories. For example, a Hyatt hotel could switch from a Category 6 property (25,000 points per night) to a Category 7 property (30,000 points per night).
- Changing the number of points required for a free night in a given category. Rather than changing which category a hotel belongs in, we also sometimes see loyalty programs change the number of points required for a redemption in a given category. For example, in 2014 we saw the cost of a Hyatt Category 6 redemption go from 22,000 points per night to 25,000 points per night.
Anyway, the good news is that hotel loyalty programs typically give considerable advance notice of these changes, so you can redeem your points at the “old” rates before any changes occur.
Well, Hyatt has changed the category of one hotel without any advance notice whatsoever… and I don’t mind it one bit!
Park Hyatt Maldives just got cheaper on points!
Specifically, the Park Hyatt Maldives Hadahaa has gone from a Category 7 to Category 6 hotel overnight.
Gold Passport Concierge on FlyerTalk has confirmed this is intentional, and not an error.
In practice this means that:
- The cost of a free night will now be 25,000 points per night (rather than 30,000 points)
- The cost of a Points + Cash stay will now be 12,500 points plus $150 per night (rather than 15,000 points plus $300)
Why would Hyatt lower redemption rates?
What makes this change odd is that this January the Park Hyatt Maldives was adjusted from a Category 6 to a Category 7 property, so now they’re basically reversing it.
Cash rates at this hotel are expensive, often $1,000+ per night. So compared to retail, the hotel is a bargain on points, regardless of whether it’s 25,000 or 30,000 points per night.
So why would redemption rates increase and then decrease months lately? I suppose it’s possible that the hotel was suffering a bit due to the lack of people redeeming points at it. Yes, you read right.
As a general reminder of how this stuff works, hotel chains run the hotel loyalty programs, while the individual hotels are typically franchises, and both have their own best interests in mind. Hotel loyalty programs want to make their loyalty programs as profitable as possible and promote the brand, while the hotels themselves want to make their individual properties as profitable as possible.
As a result, the arrangement that most hotels have with their loyalty programs is that if hotel occupancy is above a certain number (usually 90-95%) then the loyalty program has to reimburse the hotel at the average daily rate for an award reservation, while if it’s below that “magic number” they reimburse the hotel just slightly above the marginal cost.
So at the Park Hyatt Maldives a sizable percentage of the guests were Gold Passport redemptions. And I don’t think it’s just the revenue from Gold Passport that the hotel is after, but all the ancillary revenue they get — once you’re at the hotel you’ll likely spend a lot of money, be it in food, drinks, activities, room upgrades, etc.
Is it worth visiting the Park Hyatt Maldives?
I visited the Park Hyatt Maldives just a few months ago, which was a stay I booked at the “old” redemption rates, given that the cost of redemptions here went up earlier in the year. And I really was extremely pleasantly surprised.
Here’s the trip report I wrote about my stay:
- Maldivian Dash 8 Male To Kooddoo And Park Hyatt Boat Transfer
- Park Hyatt Maldives Park Villa
- Park Hyatt Maldives Park Pool Villa
- Park Hyatt Maldives Park Water Villa
- Park Hyatt Maldives Breakfast & Diamond Cocktails
- Park Hyatt Maldives Resort Overview
- Park Hyatt Boat Transfer And Maldivian Dash 8 Kooddoo to Male
I didn’t think I’d love this hotel all that much, given that I’m generally more of a city person than a resort person. But it’s truly so isolated and picturesque, that I’d absolutely consider returning.
The one consideration is that it’s not easy to get from the US to the Maldives. First you have to fly to Male Airport, then you have to take a flight on the local airline, and then there’s a speedboat transfer required. You’ll be exhausted by the time you get to the hotel.
But it really is outrageously gorgeous.
This change in category for the Park Hyatt Maldives is fantastic news. I’m a bit surprised to see a mid-year change without notice, which suggests that perhaps the number of bookings made at this hotel using points decreased sharply. And it also further proves that in many ways some hotels do seem to rely on those redeeming points to thrive!
Will the Park Hyatt Maldives changing from a Category 7 to Category 6 property change your decision to stay there?
(Tip of the hat to Tyler)