The tides are quickly turning when it comes to hotel companies better disclosing resort fees in their nightly rates.
Hyatt appears to be the latest hotel parent company to now include nightly rates inclusive of any added resort fees when a potential guest first searches for a hotel, Skift first reported. A Hyatt spokesperson later confirmed this separately to TPG.
A sample hotel search on Hyatt’s website for a one-night stay in New York City shows that various hotels — such as the Dream Midtown, the Hyatt Centric Times Square and the Beekman, a Thompson Hotel — now note that the listed daily rate includes a resort fee. This notation is present throughout the booking process. The only time it becomes unbundled is when the fee gets lumped in with taxes and fees instead of with the nightly rate at checkout (but a traveler would have only seen the higher, combined rate inclusive of the fee throughout the booking process).
The Chicago-based hotel company’s move follows Marriott’s lead as well as a similar practice from MGM Resorts. MGM Resorts is in the process of decoupling from a loyalty partnership with Hyatt to switch to a deeper business pairing with Marriott.
“After careful consideration, we made the decision to move to what we call an all-in rate display for hotels in the Americas,” the Hyatt spokesperson said in a statement to TPG. “As of July, the most prominent rate shown throughout the booking process on Hyatt channels for properties in the Americas now includes both the room rate and any resort or destination fees. This rate does not include taxes. We did this in an effort to further enhance disclosures to our guests, in line with Hyatt’s purpose of care.”
However, the decision to include resort fees isn’t an unsolicited goodwill gesture from these companies. Several attorneys general across the U.S. targeted hotel companies over hidden fees under different names like resort fees or destination fees. Even President Joe Biden lambasted the practice in his State of the Union address earlier this year.
Marriott’s decision to bundle resort fees with nightly rates followed a settlement with the Pennsylvania attorney general. Marriott, the world’s largest hotel company, received much of the legal ire on resort fees from various U.S. states. However, the Texas attorney general went after Hyatt and Hilton earlier this year.
“Hyatt’s lack of transparency regarding hotel room prices has misled consumers and violated Texas law,” Texas Attorney General Ken Paxton, who is currently facing impeachment, said in a statement earlier this year. “These deceptive practices enabled Hyatt to advertise lodging at artificially low rates, and it must end immediately. I will not stand by while Texas consumers are taken advantage of by Hyatt, or by any hotel chain that tries to get away with charging illegal hidden fees.”
A crack in the hotel legal defense
Hyatt’s move to disclose and incorporate resort fees into a nightly rate shows that hotel companies recognize their go-to legal defense might not be ironclad.
Both Hyatt and Marriott leaders defended their resort fee practice by saying that on their reservations pages, they had some degree of note that a fee would get added at checkout. Before including resort fees in rates, Marriott labeled resort fee charges in a blue box early in the booking process. Similarly, Hyatt had a resort fee notation above room options early in the booking process but hinted that changes were coming.
“As a matter of practice, we do not comment on pending litigation, but we are aware of this industry-wide topic,” a Hyatt spokesperson said in a statement to TPG earlier this year. “While we are transparent in how we disclose fees in our booking process today, our priority is to care for our guests, so we have been actively working on enhancements to the guest booking experience through our display of rates, fees and inclusions. We will continue these efforts for the benefit of our guests and plan to implement changes in the coming months.”
If anything, it appears Marriott CEO Anthony Capuano was right when commenting on his own company’s decision to incorporate resort fees into nightly rates.
“It is not as if those were hidden somehow. We’re simply further clarifying and enhancing that transparency,” he said on the company’s first-quarter earnings call this year. “I will leave it to the state [attorneys general] around the rest of the country for the rest of the industry. But I am pleased that we will lead the industry in terms of the transparency of our disclosure for our guests.”