PHOENIX — Hyatt Hotels Corp.’s newest brand is nearing its debut after its introduction a year and a half ago.
The first Hyatt Studios is set to open in January 2025 in Mobile, Alabama. Jason Ballard, senior vice president of operations of Hyatt Studios, said the brand has had “very strong interest,” with more than 4,000 rooms in its pipeline and 250 deals in some form of negotiation to date.
After Hyatt announced the brand in April 2023, the company reached out to developers, contractors and builders and asked for feedback on what gave them trouble while building hotels and what they typically lose the most time on, he said. Hyatt also had housekeepers tour its model room facility and simulate cleaning a room for feedback.
Consumer groups tested the rooms as well, providing recommendations on what they like to see and expect in their rooms.
All of the feedback has led to improvements across the board for the new brand’s product, Ballard said.
“We’ve made a lot of changes and evolution based on talking to the people who actually build, the people who use and the people who clean the room, and it’s really evolved into a great place,” he said in an interview with HNN at The Lodging Conference.
Big real estate investment trusts are interested in the brand for its less-expensive building costs — the lowest-cost Hyatt build ever, Ballard said — paired with the traditional Hyatt DNA that is to be expected.
After evaluating which markets Hyatt is currently represented in, the company decided to target secondary and tertiary markets for Hyatt Studios. Ballard said Hyatt is represented in 95% of urban markets but only 10% of small metro markets, hence the desire to fill in those underrepresented markets.
“We have this group of client base that really loves Hyatt,” he said. “They want to stay at Hyatt, and they don’t have a place to stay in these university, interstate and small market towns. So we’re really targeting those with this brand in hopes to have a baseline of both new business and then give a place for our local guests to stay when they are traveling on these different stay occasions that don’t require them to be in a major urban market.”
The extended-stay segment experienced a boost in interest since 2020, and Ballard said the fundamentals remain strong in regard to price point and the increase in markets calling for longer stays.
“It’s affordable, especially with government per diem [rates],” he said. “We’ve seen that shorter stays are less likely, especially in the Zoom and work-from-home environment. If you’re going somewhere now, it’s actually for a greater purpose than just one meeting, where it might not have been that way before.”