Starwood American Express card members will receive 2 stays and 5 nights annual elite qualifying credit beginning October 14, 2010 when the new card terms and $65 annual card fee go into effect. Starwood Lurker states on FlyerTalk the new benefit will apply for up to two cards for 4 stays and 10 nights elite credit for the primary card member of a personal and business SPG American Express card.

What is the big deal?

The initial announcement only stated an annual benefit for five nights elite qualifying credit. That actually was not much of a helpful benefit for many SPG card members, like me, who qualify on stays for elite status. In eight years I have always qualified for SPG Platinum elite on Starwood stays and never qualified on nights. You need to average two or more nights on every Starwood Hotel stay to qualify for SPG elite on nights more quickly than stays. 

• Starwood Preferred Guest Gold = 10 stays or 25 nights in a calendar year (e.g. 2010, 2011).
• Starwood Preferred Guest Platinum = 25 stays or 50 nights.

 

SPG American Express card members (2 stays and 5 nights credit)

Reportedly all American Express cardmembers will receive 2 stays and 5 nights elite qualification credit for the 2010 calendar year in October 2010. Subsequent years elite credit stays and nights will be added each February, as long as the credit card account is active and in good standing. In February 2011 SPG American Express cardmembers will receive 2 stays and 5 nights elite credit for the 2011 calendar year.

Starwood Lurker FlyerTalk post (October 6, 2010)

The information I have been given up to now says that this will happen every late February. From that, my understanding is that everyone who is a cardmember as of October 14th will get 2 stays/5 nights this October for 2010 and then 2 stays/5 nights next February to apply toward 2011. Those who have both the business and personal cards would receive twice that.

Best regards,

William R. Sanders
Online Guest Feedback Coordinator
Starwood Hotels & Resorts Worldwide

 

SPG Elite Qualification thresholds for SPG American Express card member

Starwood Preferred Guest Gold = 10 stays or 25 nights. 

• 8 stays or 20 nights for SPG AMEX card member – Business or Personal
• 6 stays or 15 nights for SPG AMEX Personal and Business Cards member

 

Starwood Preferred Guest Platinum = 25 stays or 50 nights.

• 23 stays or 45 nights for SPG AMEX card member – Business or Personal
• 21 stays or 40 nights for SPG AMEX Personal and Business Cards member

Another post from Starwood Lurker states, “Any new card members who sign up and are approved for the SPG American Express on or after October 14, 2010 will automatically get credit for 2 stays and 5 nights towards 2010.”

Five elite nights credit was little benefit to this SPG American Express card member, but 2 stays elite credit is a benefit I think will reduce my need for one more stay at an Aloft, Element, or Four Points Hotel in 2010.

SPG made the program rule change in October 2009 to allow SPG Category 1 and Category 2 Cash & Points awards in the US and Canada.

Every couple of months since last year I looked and never found any category 1 or 2 hotel in the U.S. offering a Cash & Points award. I just checked today and went through eight states before I finally tried Wisconsin. Today is the first time I found a SPG category 2 hotel in the USA offering this elusive Cash & Points award opportunity.

Aloft Green Bay Wisconsin has a Category 2 Cash & Points award available this weekend for Friday, September 24, 2010. Green Bay Packers have a Monday Night Football away game in Chicago so the weekend football crowds are out of town.

There are only 10 SPG category 1 hotels in the USA. Good luck finding a SPG category 1 hotel, let alone a Cash & Points offer. There are about 100 category 2 hotels in the US and Canada. 

Simple calculation for hotel stay redemption point value  

Aloft Green Bay is $101 after tax for a paid stay or 3,000 points for a weekend rewards night or 1,600 points and $30 for a Cash & Points award. 

Points Redemption Value of a 3,000 points Award Stay

$101/3,000 = $33.67 per 1,000 points 

Points Redemption Value of Cash & Points Category 2 Hotel $30 + 1,600 points Award

$101 – $30 cash portion = $71 saved with 1,600 points

$71/1,600 = $44.38 per 1,000 points.

 

Advanced Points Redemption Value Calculations 

To be more precise you might want to consider the points for a paid stay not earned when spending points. Paying $89 for the Aloft Green Bay room will earn points and elite credit.

In general, I always try and pay when the room rate is around $100 to earn elite credit and points. But assume elite credit is not a concern and the value of points can be adjusted to include points not earned with a paid stay. The base points generally are not a big factor compared to the loss of SPG promotion points.

Currently SPG has the Every Night Counts promotion for double points or triple points. This promotion is really not a big effect on this stay. But sometimes promotions are worth 1,000 or more points per night or even credit towards a high value free night offer. High-value promotions can greatly impact the value of points calculations and should be considered when determining the value of a point.

Starpoints earned on paid Starwood stay: 

$89 x 2 base points/$1 = 178 points

SPG Double points promotion (Sep 8-Dec 15, 2010) = 178 points

Gold or Platinum elite bonus = 89 points 

• Base member earns 356 points (with double points promotion)
• Gold or Platinum member earns 445 points (assume double points)

 

SPG Platinum Elite 

• Platinum member already requalified for 2011 status earns extra elite bonus point or 89 points = 534 points
• Platinum member, requalified and with 10 nights in Every Night Counts (triple points) earns 712 points 

To keep this post shorter I will ignore the Platinum member who could potentially earn more points from a paid stay with the current promotions.

Two other points earning situations I will ignore since these are not relevant to the value of a paid stay vs. award stay:

• Platinum member earns 250 points amenity regardless if paid stay or award stay so this is not included.
• SPG American Express payment is also negated since 2 points/$1 earned for Starwood Hotel spend whether a paid stay or Cash & Points stay.

  

Redemption Value of Standard Award Stay for SPG general member:

Non-elite member earns 356 points paying $89 base rate ($101 after tax)  with the current double points promotion. 

• $101/3,356 points =
• $30.10 per 1,000 points.

This is still good redemption value.

Redemption Value of Cash & Points Stay for SPG general member: 

• $101-$30 = $71 saved;
• $71 saved ÷ (1,600 points Cash & Points Award + 356 points not earned for paid stay) =
• $71 ÷  1,956 points =
• $36.30 per 1,000 points

This is still excellent redemption value since you can buy points for $35 per 1,000 points from SPG.

 

Gold or Platinum elite member earns 445 points paying $89 base rate ($101 after tax)  with the current double points promotion.

Redemption Value of Standard Award Stay for SPG Gold/Platinum member:

• $101/3,445 points =
• $29.32 per 1,000 points.

This is still good redemption value. 

Redemption Value of Cash & Points Stay for SPG Gold/Platinum Elite: 

• $101-$30 = $71 saved;
• $71 saved ÷ (1,600 points Cash & Points Award + 445 points not earned for paid stay) =
• $71 ÷  2,045 points =
• $34.72 per 1,000 points

This is still excellent redemption value since you can buy points for $35 per 1,000 points from SPG.

The main point of this post is finding a Cash & Points for a SPG Category 1 or 2 hotel is a rare find in my searches. This is the first time I have seen a hotel offer this award in the U.S. since they were placed on the SPG award chart in October 2009.

Questions for readers:

Have you ever redeemed a Cash & Points award stay in the U.S. or Canada at a Category 1 or 2 hotel?

Do you even see them offered?

Starwood Preferred Guest Platinum elites who have requalified for 2011 Platinum status will receive one extra bonus point per dollar in spend from October 1 through December 31, 2010.  Promotion registration is required by December 30, 2010. Stays prior to registration will not earn the extra Starpoint. Four Starpoints promotion terms and conditions.

The extra bonus point for SPG Platinum only applies to stays after the member has requalified in 2010 for 2011 platinum elite status. This promotion is a small incentive for Starwood loyalists who reach 25 stays or 50 nights well before the end of the year.

This offer is combinable with the SPG Every Night Counts double/triple points promotion.

Platinum members who have requalified for 2011 Platinum elite will receive at least 6 points per dollar from the combination of double points and the platinum extra point for Starwood stays during the overlapping promotion dates.

SPG Gold and Platinum elite members normally receive 2 base points and 1 bonus point for 3 points per dollar in Starwood Hotel spend.

Platinum elite Starpoints earning potential is 10 points/$1 from October 1-December 15, 2010

• 2 base points/$1
• 1 elite bonus point/$1
• 2 bonus points/$1 (Every Night Counts double points bonus for 1-9 nights; Sep 8-Dec 15)
• 1 platinum elite bonus point (Oct. 1-Dec 31; platinums who have already requalified for 2011 platinum)
• 2 bonus points/$1 (Every Night Counts triple points bonus for 10+ nights; Sep 8-Dec 15)
• 2 bonus points/$1 (SPG American Express payment)

Fee increase to $65. No big deal.

Sheraton 3^rd night free offer. No big deal.

Five nights elite credit per year. No big deal.

Elimination of SPG50 annual certificate. No big deal.

The July 30 announcement on FlyerTalk by Starwood Lurker (Starwood Hotels employee) of two exciting new benefits pointed out changes coming to the SPG credit card from American Express. To date there have been 28 pages with over 400 responses on the SPG-AMEX changes.

All in all I find the changes to be no big deal and nothing too exciting.

 

Fee Increase

The $20 fee increase is a drag, but this is really only equivalent to about 500 starpoints lost for the year. When you stay at Starwood Hotels you receive 2 points/$1 when you use your SPG American Express card. Points for $250 in hotel room stays is neutralized with the annual fee increase.

Sheraton 3^rd Night Free Benefit

The Sheraton 3^rd night free offer is not clearly a new benefit as of yet. The restrictions for the ZHA or ZRA are the same as for the current 3^rd night free offers. Room is prepaid and you must arrive Thursday through Saturday. The fact that you must use your SPG-AMEX card is even more restrictive than the long available 3^rd night free Z3H/Z3R rates.

The 3^rd night free benefit will actually be an enhancement only if there is hotel availability using ZHA/ZRA codes for hotels unavailable using the Z3H/Z3R codes. The current 3^rd night free offers are available for Sheraton Hotels – as well as Westin, W Hotels, and Four Points.

Starwood Hotels 3^rd Night Free link

Starwood Resorts 3^rd Night Free link

Five Nights Elite Credit

I am in the camp who sees little personal benefit from this enhancement. I have never qualified for SPG elite status on nights.

Gold elite requires 25 nights at Starwood Hotels in a calendar year. The SPG-AMEX benefit reduces this threshold to just 20 nights.

But you only need 10 stays in a calendar year for Gold status. A person can earn SPG Gold elite with as few as 10 one-night stays in a year, or a total of 10 nights.

How many SPG-AMEX cardmembers stay 20 to 24 nights in a year, with fewer than 10 stays? Cardmembers who finish the year with 20 to 24 paid nights and fewer than 10 hotel stays are the only Gold elite recipients of this SPG-AMEX enhancement.

Platinum elite requires 25 stays or 50 nights in a calendar year. The five nights elite credit only makes a difference if you are in the subset of SPG-AMEX cardmembers who stay 45 to 49 nights in a calendar year without 25 stays.

The five nights elite benefit affects a small subset of cardmembers.

 

50% off award discontinued as annual benefit.

The SPG50 certificate is 50% off the rack rate for a hotel stay up to five nights. Most of my annual certificates have gone unused. I have only found a lower rate using SPG50 twice and the last time was in 2008. There is almost always a lower rate available. And I avoid prepaid rates whenever possible.

But any SPG member still has the same 50% rack rate option available for just 1,000 starpoints and there is no requirement to use an SPG-AMEX card.

If you regularly used your SPG50 certificate, then the changes are equivalent to losing another 1,000 points per year.

Conclusion:

Some SPG-AMEX cardmembers lost an equivalent value of 1,500 Starpoints with the annual card fee increase and loss of the SPG50 certificate.

For some cardmembers the five nights elite credit may be the difference between general SPG membership and Gold elite. Some frequent guests will find the 20 night threshold will be easier to reach than 10 stays for Gold elite.

For most Platinum elite members I do not see the five nights credit having any impact unless you are in a very select group of cardmembers having 45 to 49 paid nights and less than 25 stays.

October 14, 2010 we will see if the Sheraton 3^rd night free ZHA/ZRA offer is actually an enhancement to the SPG American Express card.

I have to wonder if SPG and American Express raised the cardmember bonus points offer from 10,000 to 30,000 points in anticipation of the new Hyatt Visa card to be launched in the next couple of months? This sure makes me wonder what kind of initial membership bonus will be forthcoming for the Hyatt Gold Passport Visa card later this year.

The current American Express deal for SPG members is sign up for a new American Express personal or business card by July 6 and spend $1,000 during the first three months of card membership to receive a 30,000 points bonus.

Update: July 15 – Lucky reports this offer has been extended to July 31. Links are provided on his One Mile at a Time blog here.

30,000 Starpoints exchange into 35,000 airline miles with almost two dozen airline partners.

But, that is not the best value for Starpoints in my opinion unless you are getting a high value premium class award ticket with the miles. There are several hotel loyalty programs – Carlson goldpoints plus, Hyatt Gold Passport, Marriott Rewards, and Wyndham Rewards with similar or better points-to-miles exchange rates than Starwood Preferred Guest.

30,000 points will get you one free night at Starwood’s über-luxury Category 7 hotel resorts like the St. Regis New York or Mystique on the Greek Island of Santorini.

But in my analyses I find the better value is generally to pay for a free night and save your 30,000 points for higher value opportunities.

I am writing about this deal because I see a high value opportunity for someone who may not typically stay at Starwood Hotels. 30,000 Starpoints can easily provide over $1,000 in real hotel savings and as long as you do not find yourself leaving a balance on your card that gobbles up the points value through interest payments, then you have a good opportunity to open up cheap access to Starwood Hotels using your 30,000 points sign-up bonus.

I generally do not write about credit card bonuses. My interest is getting people into hotels and not into bank card debt. We all hear the advice about paying off your card every month and you will have minimal expense from a credit card. That is great advice until you find yourself suddenly unemployed or you have an emergency, charge up the credit card to help with the emergency finance need and find yourself unable to pay off the balance the next month. Credit cards would not be propping up bank balance sheets if everyone could pay off their cards every month. The debt cycle keeps these cards highly profitable for the banks.

You can’t even buy 30,000 points for your account for $1,000

The value of 30,000 points is $1,050 based on the purchase price of Starpoints from SPG, however, the annual purchase limit imposed by SPG is 20,000 Starpoints in a calendar year. Lucky on his One Mile at a Time blog last week listed point values for several airline and hotel programs and he suggested the value of Starpoints is $25 per 1,000 points. This is a figure I support in general based on the ability to easily get that value when redeeming points.

That is still a $750 value for this credit card sign-up bonus.

 

The Real Value Opportunity for 30,000 Starpoints

I generally try to get $50 per 1,000 points value when making room redemptions and that is most easily achieved through SPG Cash & Points awards. These awards require only 40% of the points for a free night and a cash supplement saves 60% of the points cost.

There are many category 4 Starwood Hotels that will post room rates around $300 after tax that can be purchased with $60 cash and 4,000 points. The cash and points award will have a value of $240 for the 4,000 points redeemed for a free night. This is $60 equivalent value per 1,000 points and significantly more than the $25 per 1,000 points value suggested by Lucky.

The main drawback of Cash & Points awards are limited availability. Most Starwood Hotels are available on any given night in any given location for a standard free night award, but Cash & Points awards may only be available for about half of these hotels – sometimes more and sometimes less.

The other disadvantage of Cash & Points is no elite qualifying credit is given for the stay and the SPG member does not earn points on the Cash portion of the award night payment. Incidental spending does earn points and you need to contact the hotel if the stay does not post and you should have earned points from incidental spending.

 

Here are some sample Cash & Points values:

Le Meridien Vienna

• December 6-9, 2010 = 179 EUR/night or about US$220
• Category 4 hotel Cash & Points Award = $60 + 4,000 points ($180 + 12,000 points for 3 nights)
• $660 – $180 = $480 saved with 12,000 points.
• SPG Points Value = $40/1,000 points. 

Hotel Des Indes, The Hague, Netherlands

• May 16-19, 2011 = 255EUR/night or about US$318
• Category 5 hotel Cash & Points Award = $90 + 4,800 points ($270 + 14,400 points for 3 nights)
• $954 – $270 = $684 saved with 14,400 points.
• SPG points value = $47.50/1,000 points.

Westin Grand Cape Town, South Africa

• February 7-10, 2011 = 1,722 ZAR/night or about US$222
• Category 3 hotel Cash & Points Award = $45 + 2,800 points ($135 + 8,400 points for 3 nights)
• $666 – $135 = $531 saved with 8,400 points.
• SPG points value = $63.21/1,000 points.

 

Do you get the picture now?

30,000 points has the potential, when used with discretion, to save nearly $1,900 in hotel room rates at a hotel like the Westin Cape Town. That is a great sign-up bonus for a credit card that has no membership fee for the first year and $45 per year thereafter. 

Just don’t fall into the credit card interest payment trap.

 

 

Starwood Preferred Guest Cash & Points awards are the best way to get excellent value out of your SPG points. Cash & Points Award Nights, when offered, provide a 60% discount in the points required for a free room night in exchange for a specific cash co-pay that is set according to the SPG hotel redemption category.

Free nights using points-only is covered by the SPG “No Blackouts” policy, but the Cash & Points option is not. Cash & Points may have blackout dates, and in fact, are frequently not offered on the SPG website when points-only rooms are available. [Tip from Gary Leff is to call the hotel anyway and check for Cash & Points even when they are not appearing on the website. He reports this frequently works for Cash & Points awards.] When you have the Cash & Points award option it is a great way to conserve points on a hotel stay.

Here are some important points regarding Cash & Points award stays:

1. Cash & Points Awards are not applicable to the 5^th Night Free Awards. A 5-night stay requires 5 nights of Cash & Points payment. A “Points-Only” 5^th night free award requires only 4 nights of points-only payment.

2. Cash & Points award stays do not earn Starpoints on the paid cash portion. You are eligible for Starpoints on other eligible hotel charges like dining. A Cash & Points stay may not even show up on your account. Check with the hotel or SPG if no points post on additional charges from your Cash & Points hotel stay.

3. Cash & Points award stays are not eligible for elite qualifying credit. This also applies to points-only award stays.

4. Cash & Points award stays may not be upgraded in advance with supplemental points. Points-only award stays may be upgraded in advance based on availability using additional points. As an SPG Platinum member I have frequently received very nice upgrades on Cash & Points awards.

5. International hotels priced in non-US Dollars will be converted to local currency for payment. (Loyalty Traveler note – some exchange rates are wacky. I have ended up paying 20% less than the US dollar amount and I have paid 20% more than the US dollar amount for Cash & Points stays outside the US.)

 

Yesterday’s Loyalty Traveler post displayed a qualitative table based on a scale where an excellent redemption value for your points results in a cash savings greater than $35 per 1,000 points spent. The table points out the difficulty in getting a high redemption value in the range of $35 per 1,000 Starpoints when redeeming points for SPG high category hotels.

An SPG Category 6 hotel needs to be over $700 per night when spending 20,000 points for a free night in order to realize a cash savings of $35 per 1,000 points redeemed. Most Category 6 hotels are not priced that high in the present hotel travel economic environment.

 The value of Cash & Points becomes apparent when running the numbers for these awards at a Category 6 hotel.

 

 

For example, St. Regis Monarch Beach at Dana Point, California is a SPG Category 6 property. A check of rates for next week shows Cash & Points availability for the dates Tuesday, November 3 to Friday, November 6 for a 3-night stay.

Here are the options: (I am ignoring the $25 per day resort fee in these calculations. The resort fee is additional to numbers shown for the three options. Tax is a confusing issue. Sometimes I have been charged hotel tax on the Cash portion of the Cash & Points award and other times I have not paid the tax. In the past two years the hotel tax has usually been applied to the cash portion for my US hotel Cash & Points award stays.)

St. Regis Monarch Beach Payment Options

Cash & Points: $150 + 8,000 points per night = $450 + 24,000 points

Points-Only: 20,000 points per night = 60,000 points

Cash-Only: $470 per night (includes 10% tax) = $1,410

The SPG redemption options are either spend 60,000 points to save $1,410 or spend 24,000 points to save $915.

$1,410 cash-only rate – $495 cash portion  of Cash & Points rate = $915 equivalent value of points.

(I added 10% hotel tax to the cash portion of $450 for 3 nights = $45 tax for the award stay).

Spending 60,000 points for 3 hotel award nights gives a redemption value of $1,410 ÷ 60,000 = $23.50 per 1,000 Starpoints. 

I rate this as a “Fair” redemption value in my Redemption Quality table shown above for SPG Category 6 hotels.

Spending 24,000 points to save $915 gives a redemption value of $915 ÷ 24,000 = $38.12 per 1,000 Starpoints and now the redemption value rates as “Excellent” in the Loyalty Traveler Category 6 redemption quality scale.

At this rate of redemption value the remaining 36,000 points saved by using Cash & Points rather than 60,000 points for Points-only free nights at the St. Regis Monarch Beach next week has a value of $1,372 for future cash savings on hotel stays.  (36,000 points x $38.12/1,000 points = $1,372)

The economics of Cash & Points provides high value opportunity for Starwood Preferred Guests.

Here are SPG Cash & Points Redemption Quality tables to correspond with the Points-Only tables from yesterday’s Loyalty Traveler post.

SPG Cash & Points Redemption Quality Guide

One of the most common hotel loyalty program questions is, “What is the value of a point?”

Typically, I use the cost of points through the hotel program as the value of a point. This is an objective measure since buying points directly from the hotel program is one of the easiest ways to obtain hotel points. The purchase price of hotel points set by the hotel chain is an objective value for hotel points that can be applied across hotel programs.

Starwood hotel points purchased through SPG cost $35 per 1,000 points and there is an annual calendar year purchase limit of 20,000 points ($700). When I calculate the value of points earned from a loyalty promotion, I project the value of the points based on the purchase price from the hotel program.

 Alternatively, I should be able to calculate the value of points I spend at the same ratio of $35 per 1,000 points. If I am getting the value from my points that SPG charges for points, then I consider those spent points as getting excellent value. When calculating the value of SPG bonus point promotions or the value of points earned through a Starwood SPG American Express card, I can estimate the value of my points earned at $35 per 1,000 points.

Unfortunately, the value of my points in the Starwood Preferred Guest (SPG) program may not bring a $35 per 1,000 points return on some free hotel night redemptions. The SPG Redemption table shows that the room rate for a SPG Category 3 to 7 hotel reward needs to be an extremely high priced hotel rate to actually get a $35 per 1,000 points redemption value from SPG points. The redemption rate at Category 1 and 2 hotels is much better aligned with actual hotel room rates.

In other words, I am pretty sure I can find a Category 2 hotel on a Friday night where my 3,000 points will save me more than $105 on the published room rate for the Starwood Hotel. Remember that the reward night covers room tax so basically any Category 2 hotel with a room rate over $95 will be $105 after tax and I am receiving excellent value from my points redemption.

Finding a Category 6 hotel charging over $700 per night is going to be a bit more difficult for most SPG members. While spending 20,000 points to avoid spending $500 for a night in a Starwood Category 6 hotel may be considered a favorable exchange by many SPG members, the redemption value of your points will be quite a bit less ($25 per 1,000) than you could probably find by spending points at low category hotels.

 

 

 

Sample room rates for Starwood Hotels in New York City

Wednesday, November 18, 2009:

W New York – Times Square (SPG Category 6) = $499 (Best Available Rate) $576.10 after tax

Redemption value: $576 ÷ 20,000 points = $28.80 per 1,000 points.

AAA rate = $474.05 ($547.47 after tax)

Redemption Value for AAA rate : $547.47 ÷ 20,000 points = $27.37 per 1,000 points (Good Redemption Value).

 

Westin New York at Times Square (SPG Category 5) = $407.55 (AAA rate) or $471.16 after tax.

Redemption Value: $471 ÷ 12,000 points = $39.25 per 1,000 points (Excellent Redemption Value).

 

Sheraton Manhattan at Times Square (SPG Category 5) = $360.05 (AAA rate) or $416.66 after tax.

Redemption Value: $417 ÷ 12,000 points = $34.75 per 1,000 points (Excellent Redemption Value).

 

New York City hotels appear to refute my argument that obtaining a redemption value near $35 per 1,000 points is unrealistic. My counterpoint is New York is the highest priced hotel market in the USA. Finding redemption values in the $35 range in other locations may prove more difficult.

 

Los Angeles, November 18, 2009

 

SLS Hotel at Beverly Hills (SPG Category 6) = $287.20 (AAA rate) or $327.61 after tax.

Redemption Value: $328 ÷ 20,000 points = $16.40 per 1,000 points.

 

W Los Angeles – Westwood (SPG Category 5) = $255.20 (AAA rate) or $291.13 after tax

Redemption Value: $291 ÷ 12,000 points = $24.25 per 1,000 points.

 

Westin Pasadena (SPG Category 4) = $159.20 or $183.19 after tax.

Redemption Value: $183 ÷ 10,000 points = $18.30 per 1,000 points.

 

Sheraton Gateway Los Angeles -LAX Airport (SPG Category 3) = $119.25 (AAA rate) or $136.03 after tax.

Redemption Value: $136 ÷ 7,000 points = $19.43 per 1,000 points.

 

I think Los Angeles is the more typical redemption value for US hotels using Starwood points. New York City, or major international destinations like London and Paris, or resorts like the Maldives and Bora Bora are going to have skyhigh hotel rates where there may be good redemption value in the range of $35 per 1,000 points at the upper SPG category hotels of 5, 6, and 7.

 

Most of us will likely find our choice is redeeming 10,000 points to save $200 which may be a desired exchange, but certainly not a high value exchange of SPG points for cash savings.

 

Table of Qualitative Value for Starwood Preferred Guest Free Night Redemption

My basic question as Loyalty Traveler has been, “What is the value of a SPG point?”

 

In an article earlier this month, “Hotel Points Exchange Rate Theory”, I argue that hotel points only have potential value until they are actually redeemed for something of tangible value. A hotel room has tangible value and the value has a set dollar amount for the night you buy with your points.

 

Obviously a person who redeems 12,000 points for the Westin New York Times Square at a redemption rate of $39.25 per 1,000 points gets a better quantitative value than the person who redeems 10,000 points for the Westin Pasadena on the same night for a redemption value of $18.30 per 1,000 points.

 

In reality you need a hotel where and when you need a hotel and your redemption value will vary. So now my question is how do I compare the qualitative difference between the free night redemption at Westin Times Square, New York and Westin Pasadena?

 

I have set up a qualitative scale based on quantitative values. My standard of excellence is based on getting an “Excellent” redemption value when a SPG member can realize $35 per 1,000 points spent on a free night. SPG sells points at the rate of $35 per 1,000 points, so any redemption that saves money at a higher rate than $35 per 1,000 points is “excellent” in my opinion. You can simply buy points from SPG and get the room for less money than the room rate being charged (up to your annual 20,000 points purchase limit of course).

 

The scale drops in incremental levels of ½ a penny per point. In other words, $35 per 1,000 points is an excellent redemption value. When you realize $30 per 1,000 points you have made a “Good” redemption value. $25 per 1,000 points is an “Average” redemption value. $20 per 1,000 points is a “Fair” redemption value. $20 per 1,000 points is a “Poor” redemption value. Less than $20 per 1,000 points is a “Bad” redemption value.

 

The SPG table looks like this based on a standard where redeeming points for free hotel rooms at a rate greater than $35 per 1,000 points is considered an “excellent” value:

 

 

 

Working from this standard table of qualitative value I can now create tables for any SPG category hotel to show the qualitative value of a hotel free night based on the room rate being charged for the night at that particular hotel.

 

SPG Redemption Value for Free Nights Using Points

 

What I see in these tables is the use of points at a Category 7 hotel is less likely to provide excellent value (Is the room rate > $1,050 per night at the Category 7 hotel?) than a Friday or Saturday night at a Starwood Category 2 hotel where any rate over $105 (after taxes) is going to be an “excellent” redemption value based on the same quantitative-qualitative scale.

 

I have also ignored peak season rates which were suspended for 2009at the upper end SPG Category 5 to 7 hotels. If reinstated in 2010 there will need to be additional tables to account for Category 5 hotels at 16,000 points, Category 6 at 25,000 points, and Category 7 at 35,000 points. These peak season tables will be less favorable for finding excellent value redemptions.

 

Conclusion: You will likely pay more points for an equivalent cash savings when redeeming points for a high category hotel with Starwood compared to a low category hotel.

 

 

[correction 11:00am Sun, Oct 25 - original post used 70,000 as nightly Category 7 rate for Bora Bora all-suites properties which is incorrect for these uber-category 7 hotels. These Category 7 hotels are available for points on these dates, however, Le Meridien is actually 75,000 points per night or 300,000 points for 5 nights for the lowest category room SPG customer service could find. A different category room in overwater suite is 120,000 points per night or 480,000 points for 5 nights.

 

The St. Regis Bora Bora is available at 480,000 points for a 5-night stay.

 

Le Meridien Bora Bora (SPG Category 7 all suites hotel @75,000 points per night) November 16-21, 2009

All rooms are suites and are double points. 75,000 points per night with 5^th night free = 300,000 points for a 5-night stay.

Published rate = 51,000XPF (after tax per night) = about $3,200 for 5 nights.

$3,200 ÷ 300,000 points = $10.67per 1,000 points redemption value. (Bad value on my qualitative scale)

 

St. Regis Bora Bora (SPG Category 7 all-suites hotel @ 120,000 points per night) November 16-21, 2009

Published rate = 70,000XPF = about $4,850 for 5 nights

$4,850 ÷ 480,000 points = $10.10 per 1,000 points redemption value. (Bad value on my qualitative scale)

 

On one hand you can just pay the cash for Bora Bora and save your points for higher value redemptions at other Starwood Hotels. On the other hand, blowing 300,000 to 480,000 points for an incredible 5 night hotel stay leaves you with $3,000 to $5,000 to invest in paid Starwood Hotel stays that can earn many of these points back while also earning high elite status.

 

Figuring the best value for your points is ultimately a personal decision.

 

 

The best redemption value for Hilton HHonors points is generally a high category hotel on a HHonors VIP Reward of six or more nights. 

Hilton Auckland, New Zealand

What do you do when after a year of traveling you have 100,000 points and you want a vacation in three months at a Category 6 hotel or Waldorf=Astoria low season hotel stay for 6 nights, but you need 75,000 more points for the hotel stay reward?

HHonors allows a member to purchase points, up to 40,000 points in a calendar year at a rate as low as $10 per 1,000 points.  The points should be in your account and available for redemption in less than an hour. 

Still, after a $400 internet purchase of your maximum annual buying limit of 40,000 points at HHonors, you are 35,000 points short of the 175,000 points needed for a six-night Category 6 GLONP2 HHonors VIP reward.

What does a determined traveler do to get 35,000 points at minimal expense? 

HHonors Points Transfers

Hilton HHonors allows members to transfer or receive an unlimited number of points between member accounts.  The fee to transfer points is only 25% of the fee to buy points. 

10,000 points can be transferred from one account to another for a $25 fee.  35,000 points can be transferred from one member’s account to another member’s account for $87.50.

“Hilton HHonors® points can be transferred to another HHonors member in increments of 10,000 points, at a cost of $.0025 USD per point, or $25.00 USD per 10,000 points. There is no limit to the number of HHonors points a member can transfer or receive. Fees are based on the number of points a member transfers out of his or her account. After transferring 200,000 points in a calendar year, any subsequent transfers that calendar year are complimentary.”

 

http://hhonors1.hilton.com/en_US/hh/terms.do#hilton_hhonors_point_transfer_and_registry_program

 

Your potential ability to tap this option is proportional to your network of friends and family who have HHonors points and who are willing to transfer them. 

Recap:  Goal is 175,000 points

                You have 100,000 points in your account from hotel stays and credit card activity.

                You purchased 40,000 points for $400.

                You need 35,000 more points which is an $87.50 transfer fee.

                You need to find someone willing to transfer HHonors points to your account.

Welcome to FlyerTalk’s Coupon Connection Trading Network

The next piece of advice is the grey area of traveler strategies Loyalty Traveler generally does not touch upon in blog posts, but today I will discuss what routinely happens in the world of frequent flyer and hotel loyalty programs.

Travelers often find a great deal is just out of reach of your miles or points balance. 

Remember the corollary:

“Miles and Points have no real value, only potential value, until they are redeemed.” 

FlyerTalk has the Coupon Connection forum where members make exchanges of frequent flyer miles and hotel points through mutual agreement of terms.  There has been much discussion on FlyerTalk and elsewhere over the years of whether bartering these airline miles and hotel points is a violation of frequent flyer and hotel loyalty program terms and conditions.   All I can say is trades happen all the time and generally the only problems encountered are when a traveler sells miles to a broker. 

I have been contacted many times over the years by companies wanting to buy my frequent flyer miles. These kinds of companies are sometimes listed in the classified section of USA Today and major papers with pitches like – Sell Your Miles for Cash. 

Basically they pay you to redeem your miles for an award ticket for someone else.  I have been offered $2,000 for 100,000 miles, and I presume, the company can sell the award ticket for $3,000 to $5,000 and make a profit.  I have never sold my miles, but I sure was tempted a few years ago when I was unemployed and sitting on more than one million frequent flyer miles. 

I like travel too much to sell my hard-earned miles or points.

Now – present day – a million people have lost jobs in the past six months, and many big-time road and air warriors currently find themselves miles-and-points rich and cash poor.  This is the time for some mutually beneficial trading.

The Value of a Point

Coupon Connection may be an avenue to find people with points, but why would anyone just give points to you, even if you offer to pay the transfer fee?  For the timid traveler who wants to avoid trading with someone for HHonors points there are other methods to quick HHonors points.

HHonors Partners for Miles to Points Exchanges

Hilton HHonors allows some airline frequent flyer miles to be exchanged for HHonors points.

5,000 airline frequent flyer miles can be exchanged for 10,000 HHonors points from these programs:

·         American Airlines ($25 fee)

·         Amtrak

·         Hawaiian Airlines

·         Icelandair

·         Mexicana

·         Virgin Atlantic has a lower exchange rate of 5,000 miles = 5,000 points.

I have to wonder how many thousands of flyers are sitting on 5,000 Icelandair miles that will likely go unused after that one trip to Europe on Icelandair.

Purchasing 35,000 points would cost $350 if you were allowed to purchase unlimited HHonors points.  A good value would be to get 35,000 points for $350 with a transfer.  After deducting $87.50 for the transfer fee, the member needing points still has $262.50 in trade value to offer someone else for their points. 

I’ll leave it up to the reader to fill in the details of what is a fair trade for 35,000 points.

American Express Membership Rewards

Another route to HHonors points is making a credit card exchange of Membership Rewards points to HHonors points.  The exchange rate is:

                1,000 Membership Rewards = 1,300 points

This is not a particularly favorable exchange considering HHonors sells 1,300 points for $13, whereas, an airline sells 1,000 miles for $25 to $35 and 1,000 Membership Rewards points can be exchanged for 1,000 miles in many programs. 

A better option is to exchange American Express Membership Rewards points to one of the HHonors miles-to-points partner airlines.  Hawaiian, Mexicana, and Virgin Atlantic are Membership Rewards points-to-miles exchange partners.

Transferring Membership Rewards points to Hawaiian Airlines is your best choice due to the fact it is a US based company and gives a better exchange rate than Virgin Atlantic. 

Feb 13 Update:  There is limited usefulness to this strategy since Mexican and Hawaiian both limit mileage transfers out to miles earned from flying.  WebFlyer has a mileage calculator with options for maximizing transfers from one program to another.  I suggest checking it out for creative ways of exchanging miles and points between programs.

http://www.webflyer.com/programs/mileage_converter/index.php

Mexicana Airlines has restrictions on transferring miles out of Mexicana Airlines.  I have had over 100,000 miles in Mexicana Airlines for over five years and I can’t transfer them to HHonors due to earning them from a promotional bonus.  This condition may not apply for Membership Rewards exchanges, but I wouldn’t risk hassling with Mexicana Airlines when you have Hawaiian as an alternative.

                1,000 membership Rewards = 1,000 Hawaiian Airlines miles = 2,000 HHonors points

Miles must be earned from flight activity to be eligible for transfers from Hawaiian miles to HHonors.

Starwood Preferred Guest as a route to HHonors points

Another option is to transfer 20,000 Starpoints to an airline for 25,000 miles.  American Airlines is a SPG airline partner. 

                20,000 Starpoints = 25,000 AAdvantage miles = 50,000 HHonors points

Diners Club Rewards as a route to HHonors points

Icelandair and Amtrak are  Diners Club Rewards exchange partners. 

                1,000 Diners Club Rewards points = 1,000 Icelandair miles = 2,000 HHonors points

Club Rewards points can be transferred directly to HHonors, but at a lower rate:

Direct transfer of Club Rewards points to HHonors:

 1,250 Diners Club Rewards points = 2,000 HHonors points

To recap ways to accrue HHonors points:

1.       Purchase HHonors Points at rate of $100/10,000 points

a.       (40,000 point limit in a calendar year)

2.       Transfer HHonors points

(transfer fee is $25 per 10,000 points)

3.       Exchange airline miles directly for HHonors points:

5,000 airline miles = 10,000 HHonors points.

4.       Exchange Starwood Preferred Guest points to airline miles and then to HHonors points.

20,000 Starpoints can be exchanged 25,000 American AAdvantage miles and then into 50,000 HHonors points.

5.       Exchange American Express Membership Rewards points to airline miles and then to HHonors points. 

5,000 MR points = 5,000 Virgin Flying Club miles = 5,000 HHonors points

6.       Exchange Diners Club Rewards points to airline miles and then to HHonors points

5,000 Club Rewards points = 5,000 Icelandair miles = 10,000 HHonors points

A direct transfer from Diners Club to HHonors results in 20% fewer points:

5,000 Club Rewards points = 8,000 HHonors points. 

The drive across Oregon on Interstate 5 yesterday was miserable.  Passing truck after truck through white-out conditions from the road water spray was simply a pedal to the metal dash to get in front of another truck for improved road visibility.  

The cold rain dampened sightseeing adventures.  The last twenty miles to the Portland Airport on Interstate 205 at 6:00pm was bumper to bumper traffic.  Portland has grown quite a bit since I last drove the area in 1992.  

Airport travelers don’t need to be concerned with the traffic.  The aloft Portland has a shuttle and light rail access from the airport or city. 

The hotel

The bright lights outside the hotel entryway and an array of glass windows in the lobby seemed like “a vision of W Hotels”.

aloft Portland Airport at Cascade Station

Terminals at the entrance can be used for self-check-in.  I used the desk and redeemed my SPG American Express annual certificate for 50% off to cut the rate from the lowest published internet rate of $139 per night down to $79.50 based on a $159 rack rate.  An SPG member could also lower the rate using 1,000 Starpoints for a 50% off award. 

The receptionist did not ask me about a platinum amenity at check-in.  I asked her on a trip back through the lobby and I was told I’d receive 250 points.  I guess there are no alternative choices and I hadn’t realized aloft hotels are second-tier amenity class with only 250 points like Four Points.  I’ll have to check if the new Element brand is the same at 250 instead of 500 points.

Mac computers and pool table in aloft Portland lobby

The Lobby

The lobby is set up for socializing or work.  A pool table is a prominent feature.  A computer cubby contains two Macs with large screens, complimentary internet access and the major MS Office applications. 

There are a variety of board games around the room, seating for dozens, and a long counter adjacent to the pool table with outlets for working on your own computer.

A variety of books from Rock Encyclopedia to Zodiac astrology, large screen TVs, magazines, and loads of board games can keep you busy for the night and day.  The w xyz bar was not happening on a Wednesday night.  Thursday is the happening night with a “diva dj”.  At checkout I learned that Missy Higgins had played in the aloft lobby Monday night.  I am so bummed to have been two days late for that show.

aloft Portland, w xyz bar in lobby

Two elevators for the five floor hotel.  The hotel is so green you can grow roots waiting for the elevator.  Seriously, I have been in very few hotels in the past twenty years with a slower elevator.  Good thing the hotel does not have twenty floors. 

aloft Portland lobby

The indoor pool is separated from the lobby by an interior open-air courtyard.  The rain kept people out of the courtyard.

aloft Portland courtyard between indoor pool and lobby

The pool faces the road and the window design of the hotel means pedestrians on the street can gaze in.  On the other hand, swimmers can gaze out to the mall across the street.  Driving by the new mall I wondered if the lack of shoppers is due to the economy or the location.

aloft Portland indoor pool

The pool room was unused in the numerous times I passed by or viewed it while waiting for the elevator.  The pool room was quite comfortable with plenty of lounge chairs, tables, a shower, toilets, and a lovely temperature.  All the glass allows you to look from the pool across the courtyard into the lobby.

The hotel strikes me as a great place to socialize or entertain yourself with the games, magazines, books, and gadgets.

The Room

The first thing you see when walking in the room is the bathroom area and small closet space.

The coffee maker, safe, and magazines are across from the sink in the aloft room.

From other reviews I have read and photos I have seen there is a uniformity to the room design in aloft hotels around the country.  You would be hard pressed to tell which hotel location you are seeing when looking at photos of the lobby and rooms.  Unlike W Hotels which all have unique character, the aloft brand is a formula hotel and if you like the formula you can count on a consistent feel at other locations. 

 

Bathroom sink is located next to room doorway and empty refrigerator is beneath sink.

The toilet is located between sink and shower. 

aloft doesn’t have little toiletry bottles of Bliss products to take home.  Refillable jars are on the shower wall.

aloft bed sits in center of room and looks onto a wall with large screen TV.

The TV is the only wall feature in the room.  The barren walls would drive my wife crazy.

The desk area is where I spent most of my aloft stay working away on the computer and making phone calls.  Complimentary wireless internet, local calls, and toll-free calls saved me some money.  I paid $12.95 last month at the W Hotel Silicon Valley to access the internet for 90 minutes.

One complaint I have about the room design was the cold room could quickly be heated with the room thermostat, but the warm air did not circulate under the desk where I was working on the opposite side of the room in front of the window.  Putting on shoes solved that issue.

Iron and Board are tucked away in a nook on the side of the bed.  Lucky I even saw them.

Which leads me to another complaint regarding no hotel directory in the room.  There is a laundry room in aloft hotels and I only knew this from reading a Hotel Chatter review and seeing the photo of the “Clean” room.  The Portland aloft laundry room is on the 5th floor.

The aloha staff are helpful if you ask questions.  A laundry room is something I would be more likely to read about in a hotel room directory rather than asking.  Since the aloft hotels are so uniform a room and hotel map would be a simple feature to provide to indicate things like the location of the iron and laundry room and the other features of the hotel.

 

I like the functionality of the aloft space.  From the games and recreational activities, to the lobby bar and food court, to the 42 inch TV on the bedroom wall and basic room clock the objective is to provide the basic amenities a traveler is most likely to need.

The room is great for a single.  Two people will likely be fine for a night.  A family may find the room a little sparse and cramped.  There was only the desk chair and the bench directly under the TV for seating. 

As an airport hotel these aloft hotel designs are a good option for the traveler.   

 

Hyatt Hotels allows you to earn a free night after two stays on top of a 21% discount. 

Click here for the promotional link.

Booking Window: Friday, October 24 – Wednesday, November 5. 

Use or ask for special offer code LTGP06 for the discount rate.

Travel Window: Friday, October 31 – Sunday, February 1, 2009 

• Fully Pre-Paid and Nonrefundable Limited Time Offer Rate

This discount rate is eligible for Faster Free Nights. 

Hyatt even goes so far as mentioning Faster Free Nights promotion on the 21% discount reservations search webpage.  The terms and conditions state this special 21% discount rate “may not be combined with other promotional offers”, however, the Faster Free Nights is combinable with this rate according to Hyatt Customer Service. 

•  

Hyatt Gold Passport members were notified of the Hyatt Discount Rate by email on Friday, October 24.  My searches last Friday and over the weekend found little value for this rate as most of the hotels I checked were not offering the discount on dates I searched.  The hotels I checked offering the discount rate tended to be only a few dollars savings on the AAA rate.  All locations vary and others might have better luck for the locations you are staying. 

•  

The sale is available to everyone as of today and the website now appears to bring up the 21% discount rate without even needing to use the special promotional link or LTGP06 code.  Try your luck.

 

 

 Dandelion Flower is used in Hyatt Promotion

The Hyatt promotional advertisement photo on the Hyatt website is a dandelion blowing in the wind.  I was born a military brat, here on the Monterey Peninsula of California, and traveled around the country and Germany for 15 years until returning here to California in 1975.  Around 1998 I came across a military brats association on the internet, now known as militarybrats.com or military-brats.com or militarybrat.com  (so many sites). Dandelions were chosen as the organization symbol. Growing up as military brats, we were kids who could blow around the world and always take root and thrive in a new place.

Thank you for the imagery Hyatt.   

·          

 

Word of warning on nonrefundable rates. 

Here is another opportunity to express my reluctance to book pre-paid nonrefundable rates. 

I am currently researching hotel rates for the cities of Portland, Oregon; Seattle, Washington; and Vancouver, British Columbia. 

In the two weeks since I started looking at hotel rates for these cities, the rates in Vancouver have dropped over 10% just due to currency exchange fluctuations. 

The W Seattle dropped its nightly rate by over $50 per night for the night I plan to be in the city. 

I learned after further research that two new Starwood hotels in Portland, Oregon can be reduced over $50 per night by booking a SPG 50% off rack rate rather than using the best available rate currently advertised. 

The aloft Cascadia, in Portland, Oregon can be reduced to $79.50 from $139. 

The new Luxury Collection hotel, Portland’s The Nines, is reduced $50 per night from the current opening rate of $249 by booking a 50% off rack rate for $199. 

One discount rack rate covers my SPG American Express card membership fee ($40 for the year) and provides an opportunity to use that annual 50% Starwood Hotels certificate that comes each year of card renewal. 

The other rack rate discount costs only 1,000 Starpoints as an SPG award option.  Getting a $50 value for 1,000 Starpoints is a good return on investment in SPG loyalty.  And 50% off rack rate Starwood awards qualify for elite qualification nights towards renewing SPG elite status. 

I am glad I did not try to lock in hotel rates with an internet-only nonrefundable discount rate two weeks ago.