Hyatt in Jamaica nets US$8m in six months, parent to go public

The Hyatt brand in Jamaica netted US$8 million over six months up to June 2016, according to the Playa Hotels & Resorts' prospectus released this week.

The prospectus offers a rare glimpse into the local operations of the hotel brand, and comes as Playa prepares to launch an initial public offering (IPO) in the United States and list on the NASDAQ stock exchange.

Playa did not indicate the size of its IPO in its prospectus, but market watchers estimate the figure beyond US$100 million.

The Netherlands-based group operates hotels in Mexico, Dominican Republic and Jamaica.

The prospectus noted that for the six months ending June 2016, the Hyatt Ziva and Hyatt Zilara resorts at Rose Hall in Montego Bay generated net income of US$8 million and adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) of US$11.7 million. It did not report the revenues earned by the properties, which together sport 620 rooms.

Playa views earnings derived from Jamaica as still in the "ramp-up" phase, with expectations of future growth.

"We commenced our repositioning activities in November 2013, and we reopened the resort in December 2014, while continuing ongoing renovation activities throughout 2015," the hotel group said.

The resort in Jamaica is one of the most recent property additions to the group. Playa acquired the property from the former Ritz-Carlton Golf & Spa Resort, Rose Hall, Jamaica in August 2013 for US$66.2 million, then invested US$87.3 million as at December 2015 to expand, renovate and reposition as an all-inclusive, internally managed resort. The expansion programme included an additional 193 luxury suites, 16 food and beverage outlets, a new 50,000-square-foot food and beverage village, a renovated lobby and lobby bar, and a refurbished spa.

Playa owns a portfolio of 6,142 rooms spanning 13 resorts in Mexico, the Dominican Republic and Jamaica. The group generated net income of US$46.4 million on total revenue of US$287.3 million at half-year ending June.

Playa describes Montego Bay as the anchor of Jamaica's northern coast resorts consisting of "all the attributes of a successful all-inclusive destination". These include beautiful beaches, an ample supply of low-cost labour and solid air accessibility, the prospectus stated.

"In addition, all-inclusive resorts provide an extra layer of safety to guests who may not want to venture outside the hotel. Jamaican-based operators like Sandals and SuperClubs were the first to target the US guest. These companies expanded almost entirely in English-speaking Caribbean islands," it added.

steven.jackson@gleanerjm.com