Over the past two months Hyatt has announced the launch of two new all-inclusive brands, Hyatt Zilara and Hyatt Ziva

　　Over the past two months Hyatt Hotels Corp., Chicago, has announced the launch of two new all-inclusive brands, Hyatt Zilara and Hyatt Ziva coupled with an investment of US$325 million in Playa Hotels & Resorts, Fairfax, Virginia, and a franchise agreement for Playa to operate six all-inclusive resorts under these brands.

　　To find out more about the venture, we spoke with Steve Haggerty, Hyatt's global head of real estate and capital strategy.

　　HOTELIER: Why made the Playa deal attractive to Hyatt?

　　Steve Haggerty: We are deploying our capital in a manner that allows us to expand into a high barrier-to-entry market segments, and get to scale quickly. The all-inclusive segment has experienced impressive growth — in Mexico alone, the number of all-inclusive inventory more than doubled from 2000 to 2012 — and we believe that we have the opportunity to raise the bar on the all-inclusive experience.

　　Entering this segment will allow us to provide Hyatt's authentic hospitality to a new guest base, will increase Hyatt resort options for our loyal guests and will aim to create shareholder value by providing a platform for future growth, as well as through our common and preferred interests and recurring franchise fees.

　　HOTELIER: Where will Hyatt's first all-inclusive resorts be located?

　　Haggerty: The first locations for the Hyatt-branded all-inclusive resorts will be in Cancun and Los Cabos.

　　Mexico is the second largest economy in Latin America and is currently achieving strong economic growth as well as an increase in tourism arrivals. It is one of the world’s leading leisure destinations, particularly for travelers from the United States and increasingly from markets like Brazil, Russia and China. We believe that the potential for growth in both the business and leisure segments is very strong in Mexico and, therefore, have chosen to invest in the market in order to establish a strong foundation for our brands there.

　　HOTELIER: Who will the typical customer be and how will you market to them?

　　Haggerty: We believe that the Hyatt guest matches up very well with travelers who choose an all-inclusive experience. The all-inclusive segment offers a range of experiences and price points, and we believe that Hyatt will be able to differentiate its all-inclusive brands thanks to our long history of quality and expertise.

　　We have done preliminary research with Hyatt Gold Passport members in the U.S. and Europe who recently stayed at our resorts, which showed that nearly 20% currently stay at all-inclusive resorts and they would be even more likely to stay at an all-inclusive resort if it was Hyatt branded.

　　Additionally, more than 40% of Hyatt Gold Passport members who have not stayed at an all-inclusive resort said they would be very likely to do so if Hyatt offered an option in a destination they were considering.

　　HOTELIER: How much of a challenge is staffing these resorts?

　　Haggerty: The properties that Hyatt will rebrand are already well-established, popular options for guests. We believe that Hyatt has the opportunity to create a new experience in this segment.

　　That will begin with educating current staff about our mission to make a difference in the lives of the guests we touch every day by infusing our signature brand of authentic hospitality into the staff’s approach to service.