Hyatt properties are broken into categories, which determine how many points you need to redeem a free night at a given property, while giving a guideline for category-based free night award eligibility.
Because of this, it’s useful to understand these categories when you’re racking up points for an award stay, or just browsing around looking for a place to stay for your next vacation. To put it simply, Hyatt’s hotel categories are determined by a few things: Location, property type (brand), and demand.
Hyatt does not use these categories to determine how “good” a hotel is. It seems simple to say, “Hotel A is a category 3, and hotel B is a 5, so hotel B must be better.” It doesn’t work like that, especially when looking at it from the global level.
For example, is the Hyatt Place Marlborough in Central Massachusetts, a category 3, going to be the same in terms of quality as the Park Hyatt Jakarta, which is also a category 3? No, of course not. It’s the demand for award bookings that determines these categories, as we can see Hyatt does every spring when it shuffles around the category numbers for some properties.
Take Japan as an example, where almost every property there went up a category this past March. Here were the changes:
- Andaz Tokyo Toranomon Hills: Category 7 to Category 8
- Caption by Hyatt Namba Osaka: Category 1 to Category 2
- Grand Hyatt Tokyo: Category 7 to Category 8
- Hotel Toranomon Hills: Category 6 to Category 7
- Hyatt Centric Ginza Tokyo: Category 6 to Category 7
- Hyatt House Tokyo Shibuya: Category 4 to Category 5
- Hyatt Regency Kyoto: Category 5 to Category 6
- Hyatt Regency Tokyo: Category 4 to Category 5
- Park Hyatt Tokyo: Category 7 to Category 8
A big contributing factor to these changes was the high demand for travel to Japan in recent years, which I’ve written extensively about. Thanks to the weak Japanese Yen, coupled with the post-pandemic travel boom, the nation has been breaking record after record of foreign visitor numbers. So far this year from January to April, the nation has seen a total of 14.4 million foreign visitors enter the country, and is well on pace for a total of 43 million visitors in 2025. This number shatters last year’s record-setting count of 36 million.
Airlines and hotels look at this type of data and trends closely. In Hyatt’s case, they don’t want their Tokyo properties constantly booked with awards when they’re almost always near capacity, as this costs their hotels more money. This is a major reason why a property will increase in category, not because all of these Tokyo Hyatts all of a sudden got better in quality all at once.
Reevaluating Category 1-4 Free Night Awards
One thing in that Japan example you might notice is the category increases of the Hyatt House Tokyo Shibuya and the Hyatt Regency Tokyo. Both of these went up from a category 4 to a 5, meaning that they are no longer eligible to be booked with a category 1-4 free night award.
With this, all Hyatt properties in Tokyo start at a category 5, meaning that Category 1-4 free night awards cannot be used anywhere in the city. This is the same case in Manhattan, as all properties on the island begin at 5 (The Hyatt Place in Long Island City is still New York City though, and I recommend considering the one there 😉).
All in all, many properties have been going upwards in recent years. For example, category 8 hotels were introduced in 2018 and were originally limited to their partnership with Small Luxury Hotels of the World. Fast forward to today though, and category 8 properties can be found in many of Hyatt’s brands. This has also limited the use of Category 1-7 free night awards.
This overall trend has many thinking of potential category 9 properties, as well as the change from the Category 1-4 free night award to a Category 1-5 free night award, which I think is an interesting one.
Hyatt offers the World of Hyatt Credit Card. This cobranded card comes with a $95 annual fee, and one of the benefits is a Category 1-4 free night award. But as these awards become less and less valuable every year, there’s no doubt that customers also notice this trend and see less value in this award. This directly ties into the value of Hyatt’s cobranded card, and Hyatt should have a reason to reevaluate it because of this. For example, I wouldn’t mind an annual fee increase to $150 in exchange for the hypothetical Category 1-5 free night award.
There will be customers who aren’t going to see value in the card just because they can earn some Hyatt points, especially when Chase transfers are around.
All of this said, the World of Hyatt is still a fantastic, high-value program. They still have an award chart, and points are relatively easy to accumulate, especially with the Chase transfers. Ultimately though, with travel demand expected to rapidly increase in the long-term future in addition to more and more customers signing up for the World of Hyatt program every day, I don’t think that a hypothetical category 9 and a category 1-5 free night award is that far away.
Featured image via Hyatt.
As a first step, Hyatt should allow members to top off their Cat. 1-4 Certs with points like Marriott and IHG do. That would be an easy first step that at this point is absolutely necessary for people to continue seeing value in the Cat. 1-4 Certs.