Hyatt to Expand Further in Mexico - Analyst Blog

Most hoteliers are trying to strengthen their foothold in the industry through continuous international expansion. As part of its expansion strategy, Hyatt Hotels Corporation H announced that its affiliate entered into a joint venture with an affiliate of Desarrolladora Mexicana de Inmuebles, S.A. de C.V. to unveil a Hyatt Regency hotel in Guadalajara, Mexico. Desarrolladora — a Guadalajara-based national investment, business development and operating company — will act as the developer as well as manager for the property.

Christened Hyatt Regency Andares Guadalajara, this hotel is scheduled for a 2016-end opening. The 220-room hotel will feature modern amenities like corporate meeting space, spa facilities, a fitness center and an indoor swimming pool. The hotel will join four other Hyatt Regency-branded hotels in Mexico and mark the hotelier's return to the city after a 17-year hiatus.

Hyatt Regency Andares will be located in Zapopan, the northwestern region of the city. Guadalajara, Mexico's second largest commercial center has emerged as a business and commerce powerhouse of Mexico. The 220-room hotel will feature modern amenities like corporate meeting space, spa facilities, a fitness center and an indoor swimming pool.

The hotel is part of the second phase of development for the existing Andares Shopping Mall, a multi-purpose complex. The development project also includes residential units and retail spaces.

Apart from these, the hotel will be located at a stone's throw away from one of Latin America's most  popular concert venues — Auditorio Telmex. In our view, the upscale location and close proximity to the major attractions will act as major crowd-pullers for the hotel.

Hyatt, like many other leading hoteliers, such as InterContinental Hotels Group plc IHG, Starwood Hotels & Resorts Worldwide Inc. HOT and Marriott International, Inc. MAR have been seeking to expand outside the U.S.

Mexico — with its rebounding industrial production growth — is a strategic pick for Hyatt. In fact, Hyatt currently has nine other properties in the pipeline to tap in on the surge in demand for hotels in the Latin American country.

Hyatt, currently, carries a Zacks Rank #3 (Hold).