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Hyatt Saipan: What happens when the lease is up?

Hyatt Saipan: What happens when the lease is up?

The lease on the Hyatt Saipan will expire a little over 3 years from now in December 2021. What will happen then?

The resort hotel’s General Manager Nick Nishikawa has said it is, of course, their hope that they will be able to continue to keep their doors open.

Three months ago, Marianne Teregeyo, Saipan’s Public Lands Secretary, met with Hyatt management but could not provide any updates as the talks continue. Imperial Pacific International (CNMI) LLC is also involved in the investment discussions.

On the government side of the lease talks, Saipan’s Senate President Arnold I. Palacios introduced a bill to change the current law that would increase the lease of public land to 75 years – 40 years with an extension of up to over 35 years. The bill has not yet passed.

The Senate bill (S.B. 20-35) is presently at the committee level of Resources, Economic Development and Programs after it already passed with amendments at the House level.

The Department of Public Lands will issue a Request for Proposal (RFP), and the Hyatt will have the opportunity to put in a bid and include any new investments of their choosing at that point.

The Hyatt was the first international hotel brand in the Commonwealth of the Northern Mariana Islands (CNMI) and weathered the storm of ups and downs throughout its 37-year history on the island. At the time of its opening, tourism was at a standstill due to flight cancellations to and from the US territory, the result of a dragging economy.

In 2009, the Hotel Association of the Northern Marianas Island looked to the China market to recover its tourism market, and that became the beginning of a positive turnaround. By 2012, the Hyatt Saipan was allocating rooms for tour operators to sell to Chinese tourists, which resulted in a positive domino effect of more tours and more flights.

Another challenge facing the Hyatt in Saipan is the soon-to-expire CNMI-Only Transitional Worker (CW-1) program in 2019. The visa classification of this program allows employers in the Commonwealth of the Northern Mariana Islands (CNMI) to apply for permission to employ foreign (nonimmigrant) workers who are otherwise ineligible to work under other nonimmigrant worker categories. Currently there are about 300 staff members at the Hyatt of which 80 percent are local residents, and 20 percent are under the CW-1 program. According to Hyatt’s GM Nishikawa, the CW-1 workers are always going to be a necessity to fill the employment gap at the resort.