Hyatt Terminates Contracts With Russian Hotels Over Ukrainian War

In a gesture of protest against Russia’s war on Ukraine, Hyatt has suspended service provisions previously supplied under a management agreement with the Hyatt Regency Sochi hotel in the former Olympic host city of Sochi, Russia, the company announced this week.

The move comes a few weeks after Hyatt’s March 25 decision to terminate all contracts, and any relationship or association with the Hyatt Regency Moscow Petrovsky Park in the Russian capital city, citing “compliance with applicable sanctions and government directives”.

According to The Points Guy (TPG), this is the first publicly known case of a major Western-based hotel chain withdrawing its existing presence in Russia because of the Eurasian giant’s ongoing war on Ukraine.

“To the extent we are able to do so, we are working with the hotel to ensure a smooth transition of operations from our management structure and brand to minimize impact on colleagues and guests,” a Hyatt spokesperson told TPG. “Members with reservations at this hotel for stays April 15, 2022, and beyond may contact the hotel directly.”

Cutting ties with the Sochi property now brings the Chicago-based company’s footprint in Russia down to just three hotels.

Back in mid-March, Hyatt halted all development and withdrew any new investments in Russia, as did other major Western hotel companies with a presence there—Hilton, IHG, Marriott and Accor—with several closing their corporate offices in Moscow.

While the global hospitality industry continues to collectively condemn Russia’s illegal and catastrophic incursion on Ukraine, major hotel companies find themselves in a somewhat precarious position. That’s because they don’t actually own most of their associated hotels, but, rather, franchise branding rights to standalone property owners.

Unlike major Western brands in other industries, such as McDonald’s and Starbucks, which have suspended all of their Russian operations, hotels that hold third-party contracts with hospitality brands can continue to operate, even once a company like Hyatt withdraws its affiliation. On top of which, properties franchised or managed by major hotel brands continue to provide crucial shelter for many people, including Western diplomats, journalists and humanitarian workers.

Hyatt is also providing refugee accommodations across Europe, sending supplies to Ukraine, offering job transfers and has created a fast-growing relief fund for its affected employees who are in need of basic necessities, relocation support and care. The mass exodus of Ukrainian refugees amid the current crisis is considered to be the largest European population displacement since World War II.