Skift Take

Hyatt is taking the concepts of wellness and "adjacent spaces" very, very seriously.

Hyatt Hotels & Resorts has made yet another acquisition in the wellness space, part of an effort by the company to invest in what CEO Mark Hoplamazian has called “adjacent spaces.”

This time, the company Hyatt has purchased for an undisclosed amount is Exhale. The company, founded in 2002, has 25 locations throughout the United States and the Caribbean, which offer boutique fitness classes and/or spa services.

This is the second wellness company acquisition Hyatt has made this year. In January, Hyatt announced it acquired Miraval Group, a wellness resort and spa company for $375 million with plans to integrate the Miraval brand into Hyatt’s portfolio through experiences, amenities, and exclusive offerings to loyalty members. The acquisition also covered the development of more Miraval-branded resorts.

Likewise, Hyatt has similar plans for its newly acquired Exhale brand. “The big story is, going forward, what we can do to leverage this brand … ” said Steve Haggerty, Hyatt’s global head of capital strategy, franchising and select service. “That will be in our hotels and in storefronts. It’s also further strengthening the value of our World of Hyatt [loyalty] proposition.”

Specifically, Haggerty noted Hyatt will work to expand Exhale’s storefronts in “markets where they will have the most impact to the customer base that we’re referencing. The second way in which we will integrate this is through our existing hotel portfolio. That will be on a case-by-case basis how that actually materializes in each hotel.”

He added, “It’s really, in our view, quite plausible to deliver certain elements of the Exhale experience within the hotel without necessarily having a full-blown storefront in the hotel environment. We think the strength of the brand and the performance of the brand speaks for itself.”

Why Choose Exhale? And Vice Versa

The Exhale brand, Haggerty noted, is known for its ability to “service your everyday wellness needs in markets where you live and, hopefully, now on a regular basis where you travel.”

The majority of Exhale’s locations are in major urban markets like Los Angeles, New York, and Miami, but Hyatt hopes to expand them to more resort settings, too.

“It’s a business that, in our view, has done the most to and maybe the only one differentiating itself in the spa and fitness space along the dimensions of mindfulness,” he said. “It’s been a strategic decision for them to do so. As we sat back and thought of the durability of that, and how consistent it was in our efforts to serve our customer base this way, it was an easy answer to further the innovation already started by Annbeth [Eschbach, CEO and founder of Exhale] and her team.”

Eschbach said the decision to accept Hyatt’s acquisition offer was “really our dream.” She noted that half of the company’s ocations have partnerships with hospitality companies, all of which are individual property owners or developers — not the management companies themselves.

“Our business is working with hospitality partners,” Eschbach said. “We know how to do it and we thrive in this environment. We wanted a strategic growth partner who can fuel growth of the brand. We’re a very unique wellbeing brand that needs to reach a larger global audience. This is a good cultural and strategic fit, as we’re philosophically aligned with Hyatt. … Another big win for us is that Exhale will continue to operate as distinct standalone brand and continue to serve our exiting guest base in freestanding locations and throughout the Hyatt platform where appropriate.”

As for those existing hospitality partnerships that Exhale has with property owners and developers, Eschbach said they should continue going forward.

“We are very happy with all of our existing hospitality partners and partnerships. The plan is for every one of them to remain in place [following this acquisition]. … Many of them have already told me they’re excited to see Exhale go to a larger stage.”

Exhale and Miraval: Not One and the Same

One thing both Eschbach and Haggerty wanted to emphasize is that the Exhale brand isn’t going away and that it is distinctly different from Miraval, Hyatt’s other wellness acquisition.

“We’re committed to making sure we understand the brands through a heck of a lot of research that is ongoing,” Haggerty said. He described Miraval as “serving customers with a specific purpose of travel” with its destination resorts, whereas Exhale is more about offering “everyday wellness needs.”

In the future, he said, Hyatt is making sure it understands “better the interpretation of these brands and services … to make sure they show up in the right brand, space, and environment.”

There’s no specific estimate for when Hyatt guests and loyalty members can begin to see more influences from Miraval and Exhale, but a company spokesperson said “the company is looking to move fairly quickly.”

In June, Hyatt granted World of Hyatt loyalty members the ability to earn and redeem benefits when they stay at the Miraval Arizona Resort & Spa in Tucson. It’s likely a similar loyalty offer related to Exhale may appear within a few months,  as well.

A possible blueprint for how Hyatt may choose to incorporate Exhale into the guest experience may come from another one of Hyatt’s “adjacent space” investments: alternative accommodations platform Oasis. In some locations where Oasis operates, its guests have special access to fitness classes and memberships near their home stay. It’s possible Hyatt may be thinking of doing something similar with existing locations of Exhale and Hyatt properties.

Wellness: The New Luxury

Now that wellness is considered mainstream in luxury and upscale hospitality, Hyatt isn’t the only company investing heavily in this space or related areas.

In December, AccorHotels announced it had formed a strategic partnership with Banyan Tree, a Singapore-based company known for its luxury properties and spa offerings. And in May, Hilton announced it was testing a new room design that brings the gym directly into a guest’s room.

While there’s plenty of interest among a variety of hospitality companies to invest in wellness, whether that’s in relation to health, fitness, nutrition, or mindfulness, some wellness executives have also expressed skepticism that these traditional hospitality companies have the expertise or knowledge to create the best possible experiences for their guests.

“Hotel companies have no business doing the wellness programs we’re doing,” said Six Senses Hotels CEO Neil B. Jacobs. “We’re really passionate about it and it’s not so easy to pull off. Ask 100 people to define what ‘wellness’ means to them and you’ll get 100 different responses.”

Still, it’ll be very interesting to see exactly how Hyatt incorporates its two new wellness brands into the Hyatt guest experience, whether on site at its hotels, in the cities where the company has hotels, and through its loyalty program.


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Tags: exhale, hyatt, miraval, wellness

Photo credit: Hyatt has acquired wellness company Exhale for an undisclosed sum. Exhale/Hyatt

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