On March 1, a big South Carolina meeting property, the 513-room Marriott Hilton Head Resort & Spa with 46,665 square feet of event space, rebranded as Hilton Beachfront Resort & Spa Hilton Head Island.
The property reported that groups booked before March 1 have all been “transitioned.” However, any meeting organizer with an event on the books at a hotel that’s rebranding is likely to have questions: Will the new brand have the same level of service? Does it fit expectations of event sponsors and attendees? Are the needs of the meeting still a priority?
Hotels rebrand for a variety of reasons: as a result of new ownership, a strategy to stay competitive, or a repositioning in the market. There’s a constant churn, and the Hilton Head deal is far from the first or last meeting property that will rebrand this year. To name just a few: The 462-room Trump International Hotel became the Wakea Waikiki Beach, an LXR resort, in February; Austin’s 367-room Sheraton at the Capitol will rebrand as Downright Austin, a Renaissance Hotel, this spring; and the 450-room Harrah’s New Orleans Hotel & Casino will become Caesars New Orleans this summer.
Meetings-industry attorney Joshua Grimes, Esq., of Grimes Law Offices, LLC, has three recommendations for host organizations to help minimize the impact of an ownership or management change on future meetings.
1. Find out when the property’s contract with its management company expires. If it’s anytime between the initial booking and when the event takes place, “it’s reasonable to request written assurances that the meeting contract will be upheld in the event of a change in management,” says Grimes.
2. Get the hotel owner to sign your meeting contract in addition to the hotel-management company. Grimes explains that having the owner on the contract helps to prioritize the meeting with the new management and ensures that the owner is responsible to uphold the contract terms.
3. Include an “out” clause in the contract that gives the group the right to cancel in the event of a change in hotel brand or a property sale. This gives the host organization the option to move the meeting if it doesn’t approve of the changes, but also gives it the choice to stay, Grimes says. This is important because a rebranding can mean significant changes for a property and also because the original booking could have been based on brand loyalty. If the group chooses to cancel, the contract should treat it as a cancellation by the hotel—allowing the group to demand cancellation damages. This is because the rebranding was a voluntary decision by the hotel to change its product and services from those promised at time of contracting.
A final suggestion from Grimes—though challenging to negotiate, he says—is to have your advance meeting deposits placed in escrow or a separate bank account rather than having them comingled with other hotel funds. This protects your organization from the possibility that deposits fail to transfer to the new management.
