Lowe buys Hyatt business to renew vacation rental development

LOS ANGELES, CHICAGO – Los Angeles-based developer Lowe is renewing its commitment to the residential resort management business by acquiring Hyatt Hotel Corp.’s vacation rental management business and will soon become a key part of Hyatt’s forthcoming new vacation rental offering, Homes & Hideaways by World of Hyatt. Lowe would not comment about the acquisition price or resulting projected revenues for 2024.

Lowe’s newly acquired business consists of management agreements for individually owned resort residences across 36 properties in Colorado and Hawaii, as well as many of the properties’ homeowners associations (HOAs). Lowe’s hospitality management subsidiary, CoralTree Hospitality Group, will assume management of the rental units, HOAs and resort properties included in the transaction. The management business, currently known as Destination Residential Management, will be rebranded by Lowe and CoralTree.

The new Hyatt booking platform will provide the ability for the rental residences included in the transaction to be available for booking (standard and award booking) to the 40 million World of Hyatt members. This new offering will augment the marketing capabilities and distribution channels already in place at CoralTree.

The transaction will transition management responsibility for more than 1,000 resort rental residences and 27 homeowners associations in Vail, Aspen/Snowmass and on three islands – Kauai, Hawaii Island, and Maui – in Hawaii to Lowe via CoralTree Hospitality Group.

Lowe returns to roots

Lowe told Hotel Investment Today on Thursday that its priority is the seamless transition of management from Hyatt to CoralTree for these properties and property owners. “Residential resort management is how Lowe started in the hospitality business and it is a service that we know well,” said a Lowe executive. “We believe this is the ideal time recommit to this growing segment of the hospitality business and guide the residential resort management business to future growth and success. We look forward to sharing more on those plans as we progress.”

The two firms are well acquainted. In 2018, Lowe sold its hospitality affiliate, Two Roads Hospitality, to Hyatt. Lowe also manages several properties under Hyatt franchises and Hyatt manages some of the hospitality properties in which Lowe has invested. The 2018 sale included the Destination Residential Management business that Lowe had built starting in the early 1970s, and is now re-acquiring, as one component of the significantly larger business it sold to Hyatt.

Hyatt Global Head of Transactions James Francque stated in the press release, "We believe Lowe is well-positioned and highly to operate the valuable business, and to help it reach its maximum potential. We are confident Lowe is the best steward to continue to grow the business even further.”

The transition of management to CoralTree Hospitality began upon closing of the deal.

The Hyatt platform, expected to launch “in the coming weeks,” will focus on the premium vacation rentals and is expected to grow globally.

Hotel Investment Today has questions out to Hyatt to learn more about its strategy.

“We are committed to evolving access to the type of accommodations World of Hyatt members are seeking that go beyond our hotels – from a large family who travels together or guests looking to work from anywhere for an extended period of time,” Amy Weinberg, senior vice president, brand, loyalty & data, Hyatt, said in the press release. “Homes & Hideaways by World of Hyatt brings a unique collection of curated homes which increases Hyatt's home offerings and expands new ways and new places where we can extend care to members.”

As for Lowe’s return to this business model, they said interest in resort residences has increased dramatically over recent years, fueled by lifestyle changes, the desire for extended stays and the ability to work remotely from anywhere. “Lowe and CoralTree believe this is the ideal time recommit to this growing segment of the hospitality business and guide the residential resort management business to future growth and success,” the Lowe exec added.