Large Hotel Chains Eye All-Inclusive Resorts for Growth

Wyndham, Hyatt, and Marriott Bet on All-Inclusive Offerings

Wyndham Hotels & Resorts (WH), Hyatt Hotels (H), and Marriott International (MAR) are among hotel operators betting on growing demand for all-inclusive resorts. The large hotel companies are pouring money into resorts where guests can get everything they need in one place. They are betting that demand for this style of travel will increase, in part because of the pandemic.

At all-inclusive resorts, consumers pay a flat fee which covers the cost of their room plus food, drinks, and amenities. Guests often do not leave these resorts for the duration of their vacations. Guests have been drawn to these types of hotels because this kind of travel can limit exposure to COVID-19. Hotels of this nature have been quicker to recover from the pandemic than other types of hotels.

Leisure Travel Drives Recovery

The hotel industry has shied away from all-inclusive resorts in the past but now sees them as a big growth opportunity. With leisure travel expected to continue to drive recovery, and demand for all-inclusive travel climbing, many hotel companies are working to grow their presence in the all-inclusive market.

Earlier this week, Wyndham announced it is partnering with Playa Hotels & Resorts (PLYA), which develops, owns, and operates all-inclusive resorts. The two are launching Wyndham Alltra, Wyndham’s first brand dedicated entirely to the all-inclusive segment. Meanwhile, Hyatt spent $2.7 billion in August to acquire Apple Leisure Group, which is an all-inclusive resort manager. Not to be left out, Marriott has added 20 more all-inclusive resorts to its hotel portfolio.

Remote Work Changes Travel Itineraries

Widespread COVID-19 vaccines and pent-up demand is driving a lot of the uptick in leisure travel. Remote work is another reason for the growth since people working from home have more flexibility with regards to when they can travel. As a result, Wyndham has seen an increase in bookings for Sunday and Monday nights, which prior to the pandemic were less busy.

Large hotel companies see all-inclusive resorts as an easy way to grow. At the moment, many consumers are looking for hassle-free travel options and also have more flexibility to travel. It will be interesting to see if these trends continue.

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