Good evening and thank you for standing by. Welcome to the Hyatt Acquire Apple Leisure Group. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker today, Mr. Noah Hoppe, Senior Vice President of Investor Relations. Please go ahead.
Thank you, Reid. Good morning, everyone. I'd like to welcome all of you to the investor conference call to discuss Hyatt's proposed acquisition of Apple Leisure Group. Joining me on today's call are Mark Hoplamazian, Hyatt's President and Chief Executive Officer, and Joan Bottarini, Hyatt's Chief Financial Officer. Before we get started, I want to remind you that our discussions this morning, as well as information in the related press release and investor presentation, will include forward-looking statements under federal securities law. These statements are subject to numerous risks and uncertainties as described in our annual report on Form 10-K, quarterly reports on Form 10-Q, and other SEC filings. These risks could cause our actual results to differ materially from those expressed in or implied by our comments.
Forward-looking statements in the press release and investor presentation made available earlier today, along with the comments on the call, are made only as of today and will not be updated as actual events unfold. This call is being recorded, and following today's prepared remarks, there will be a Q&A session. An investor presentation detailing the acquisition is available under the investor relations link on our website at hyatt.com. In addition, an archive of this call will be available on our website for 90 days. With that, let me turn the call over to Mark. Thank you, Noah. Good morning, everyone. We're thrilled to talk to you about two exciting announcements today. First, Hyatt's agreement to acquire Apple Leisure Group, including its AMResorts hotel anagement platform. Second, a new asset sales commitment. We'll start with the exciting transaction news.
The acquisition of Apple Leisure Group, I'm going to refer to the group as ALG from now on, does three important things for Hyatt. First, it accelerates our transformation into an asset-light company. The asset-light earnings of ALG's AMResorts and Unlimited Vacation Club businesses, combined with the reduction of earnings from our owned-and-leased hotels from additional asset sales, we expect to reach an 80/20 mix of earnings from fees versus owned properties by 2024. Second, it accelerates our net rooms growth into the future. We will immediately double our resort representation on a global basis, and with ALG's embedded and prospective growth, we expect to increase the rate of growth into the future with a global leadership position in luxury resorts serving high-end leisure guests. Third, it substantially expands our presence in new markets, especially in Europe, where this transaction will increase Hyatt's hotel count by 60%.
That's over 70% in room count. This will support faster growth across the rest of the continent. ALG is fundamentally an asset-light business with no hotel ownership, aligning perfectly with our strategic goals. Moreover, AMResorts has a demonstrated track record of significant growth and a robust pipeline. AMResorts' luxury brands and large resort footprints in key destination markets will significantly expand our resort offerings. We believe we'll position us to be the preferred brand for high-end leisure travelers now and well into the future. The combined brand portfolio provides compelling development opportunities for hotel developers and owners around the world. As a result of this acquisition, we expect to increase our system-wide leisure room night revenue mix to over 50%.
As to our second announcement, we expect to complete by the end of this year over $3 billion of asset sales from the time of our first asset sale announcement in 2017. Looking forward, we are increasing our asset sale commitment by an additional $2 billion by the end of 2024. Let's turn to slide four. This slide shows the key elements of our strategy that we laid out in our investor day in 2019. In short, this transaction is fully aligned with our long-term strategy. First, driving industry-leading growth by adding significant embedded and prospective growth. This is not just from AMR's existing pipeline, but also because of the growth platform it represents. We expect to achieve even higher net rooms growth into the future than the industry-leading levels we've been delivering. Second, investing in asset-light platforms transforms our earnings profile with a focus on fee-based earnings.
Third, expanding our customer base while prioritizing compelling, personalized customer experiences and expanding to complementary or adjacent customer segments. ALG is on-brand with Hyatt, and we see a tremendous opportunity with an expanding network effect across a bigger and broader portfolio. I'll now turn it over to Joan to provide additional detail on the transaction overview. Joan, over to you.
Thank you, Mark. Turning to slide five, I'd like to give some color on the acquisition. The transaction reflects an enterprise value of $2.7 billion on a debt-free, cash-free basis. This represents a low double-digit multiple on full-year 2023 estimated ALG management EBITDA, which also reflects ALG's significant and ongoing expansion of new resorts. Through this process, we've gotten to know ALG's CEO, Alejandro Reynal, and his team very well. They are excellent operators, and there are very few teams that understand resorts and the all-inclusive segment in particular as well as they do. We're very excited and looking forward to welcoming the team into the Hyatt family. In terms of financing the transaction, we expect to fund more than 80% of the purchase with a combination of $1 billion of cash on hand and new debt financing, and the remainder with approximately $500 million from equity financing.
We have secured a $1.7 billion financing commitment from JPMorgan . Cash proceeds from the new $2 billion asset sales commitment are expected to be used to pay down debt over the next two - three years, including debt incurred to fund the acquisition. One thing I would emphasize here is that we are committed to maintaining an investment-grade profile and to continue managing the balance sheet prudently now and into the future. We expect the transaction to close in the fourth quarter of this fiscal year, subject to customary closing conditions and applicable regulatory approval. Mark, back to you.
Thanks, Joan. Turning to slide six. For those of you who are not familiar with Apple Leisure Group, ALG consists of three businesses. AMResorts is a branded resort management business. Unlimited Vacation Club, which is integrally tied to the AMResorts management business, is a fee-based membership program. ALG Vacations is a travel distribution platform operating a range of established B2C and B2B travel brands. In 2019, ALG delivered total revenue of $1.2 billion and $168 million in ALG management EBITDA. While the 2019 results would imply a multiple of about 16 x, there are a few factors to keep in mind. First, the AMR Collection hotel footprint is now 50% larger than it was at the end of 2019.
Second, ALG's 2019 results were negatively impacted from lower inbound travel to the Dominican Republic due to lingering fears at that time from crime-related issues that occurred in that market in 2019. Third, in 2019, ALG was integrating the technology platforms of Apple Vacations and Mark Travel, a business acquired at the end of 2018. That caused disruptions in the booking volumes handled by the vacations business. If you look at the multiple on 2018 earnings, for example, it would be about 14.5 x. As Joan noted, looking at our expectations for 2023, based on the recovery in travel and ALG's executed pipeline, the transaction price represents a low double-digit multiple of 2023 ALG management EBITDA. I'm going to now provide an overview of the businesses within ALG. I'd like to start with the resorts business.
AMResorts is a branded management company that provides sales, marketing, and brand management services for resorts targeting high-end leisure guests. AMResorts will operate 102 properties with over 33,000 rooms in 10 countries under the AMR Collection's six leading resort brands. This is the largest portfolio of luxury all-inclusive resorts in the Americas. Looking at the brands, each one is distinct with a differentiated target demographic. This brand approach allows ALG to target customer segments that have different desires and needs and at different price points. The range of brands also allows ALG to build customer loyalty over the long term with different options that appeal to guests as the experiences they seek change over time.
AMResorts was founded in 2001, and the portfolio has grown from nine resorts in 2007 to an expected 102 resorts at the end of 2021, with over 24 fully executed and financed deals for new hotels and over 40 in advanced stages of negotiation. Looking down this list, the portfolio, which is focused on the high-end traveler, is a very strong fit with Hyatt's customer base. Turning to the next page, the Unlimited Vacation Club, or UVC, is an exclusive travel membership program that provides its more than 110,000 active members preferred rates for vacations booked at AMR Collection properties, as well as a defined number of free nights and other benefits. UVC is a program that delivers value to its members and hotel owners and drives direct bookings and repeat business from guests that are loyal to the AMR Collection.
In current, with the growth of the AMR Collection itself, UVC has also seen tremendous growth with an 18% per annum compounded membership growth over the past five years. The vacations business is one of the largest tour operator and packaging companies in North America for leisure travel to Mexico and the Caribbean, with four travel distribution brands serving B2B customers, two B2C online brands, and white label programs for Southwest Airlines and United Airlines. Another dimension of the vacations offering is ALG's Amstar, a leading destination management company in Mexico and the Caribbean. Finally, Trisept Solutions is the proprietary packaging software that enables the tour business of vacations. Moving to slide 10, I'd like to walk you through the strategic rationale and key benefits of this transaction. First, this acquisition and our increased asset sale commitment significantly accelerate our asset-light transformation.
Second, it further accelerates our growth platform, increasing our already industry-leading net rooms growth rate. Third, it meaningfully expands our footprint in luxury. Fourth, it expands our share of wallet by providing increased choice for guests by serving more occasions of travel for our high-end guest and customer base. Last, critically, it enhances benefits for owners. Turning to slide 11, in late 2017, we announced our original asset sale commitment. Since then, we expect to have sold over $3 billion in assets by the end of this year. We estimated that we would sell hotels at a valuation range of 13x-15 x EBITDA. We expect to complete the over $3 billion of asset sales at an average multiple of 17.4 x. We are very pleased with this outcome and expect to reach the goal well before our commitment deadline.
With our new $2 billion commitment, in addition to this acquisition, we expect to reach 80% fee-based earnings upon completion of this additional sell-down. Turning to slide 12, this combination accelerates Hyatt's already industry-leading net rooms growth rate. We have the ability to build on the strong relationships AMResorts has established with its developer and owner base. The fact that many of their owners have multiple properties in the AMR Collection is a testament to the great work their team has done and the value they have delivered. Similarly, we've got a great opportunity to expose our hotels around the world to the AMR Collection and discover new opportunities of growth. The ALG owners will now have an in-the-family exposure to Hyatt's total brand portfolio.
In particular, we see incredible opportunity with luxury resorts in Southern Europe, a region where branded resorts are only 2% of total rooms versus 10% for Mexico and the Caribbean. In all-inclusive resorts in new markets in Europe, the Middle East, and Asia, regions where this concept has not yet satisfied growing demand. Additionally, AMResorts Hotels are expected to generate $2.3 billion in chain revenue in 2023, representing a step change increase in total chain revenue up from $1.5 billion in 2019. This provides significant resources that can be invested in value-added marketing and technology. We are exposing a large growing customer base to enjoy expanded choice across the Hyatt system. Turning to the next slide, we're confident that with our integrated travel platform, we will be able to expand our footprint and capture the growth we see ahead of us. Experience-related spending is growing very strongly.
There's increasing attractiveness in luxury leisure travel. And we're confident that as part of Hyatt, we can identify compelling ways to elevate engagement with our guests. We are very bullish on leisure travel. It's proven its resiliency and durability. In past market contractions, leisure travel has recovered more quickly than business travel. We're excited about luxury in particular because we expect the global luxury travel market to grow at about 11% from 2021 - 2027. As a result of this acquisition, the combined portfolio places Hyatt as a leader in this segment. Turning to slide 14, you can see the strategic benefits from a geographic expansion resulting from this combination. We are expanding our footprint in key markets where Hyatt previously had smaller presence, especially in Europe.
Our European footprint will increase by 60%, with significant growth in popular resort destinations in Spain, particularly the Balearic Islands and Canary Islands, as well as Greece. Aside from expanding our geographic presence, AMResorts opens the door to millions of additional guests to be served. In 2019, over 12 million guests stayed at AMResorts properties, which is expected to grow materially in the coming years. This list does not specify the other markets in the Middle East and Asia that represent future chapters of growth. Turning to slide 15, the future growth story is extremely compelling. As you can see, the AMResorts portfolio has grown at a 15% compound annual growth rate since 2017 and increased its room count by approximately 50% since 2019.
In other words, it's grown from less than 70 resorts at the end of 2019 to over 100 resorts by the end of 2021. Similarly, the number of Hyatt rooms has grown 41% since 2017. There's a great deal of embedded and prospective growth represented by 24 fully executed deals for future growth and 40 deals in advanced stages of negotiation, sustaining AMResorts' remarkable track record of growth into the future. Turning to slide 16, we're excited to bring highly passionate travelers closer to both Hyatt and AMR to create a wider customer base. As part of the integration following the closing of the acquisition, we will explore ways in which World of Hyatt and Unlimited Vacation Club can bring added value and unique membership benefits to their combined member base.
We believe that there will be significant value in bringing our brands together and providing our guests with an expanded set of choices to explore more brands, experiences, and places. Turning to the next slide, we see the real value this combination can deliver to owners. This value comes from a range of opportunities, including enabling further innovation and digital capabilities that can be scaled across a larger hotel base, driving more direct bookings, and leveraging shared support functions and global contact and service centers to better serve guests and increase efficiency. We also see great benefits through the combined talent and expertise across the combined organization, with great opportunities to share the collective experience of our traditional resort and all-inclusive operators. Last, we see the opportunity to better leverage vendor relationships to the benefit of all of our hotel owners.
In conclusion, you can tell we're very excited to welcome Apple Leisure Group and all its team members into the Hyatt family. We're very excited about the value this combination delivers by meaningfully advancing our asset-light strategy, accelerating our net rooms growth into the future, expanding our presence in luxury leisure travel, and strengthening our relationship with guests and owners. The future is very bright for a soon-to-be expanded Hyatt, and we are grateful for our global Hyatt family who put our purpose at the center of everything that they do, caring for people so they can be their best. With that, let's turn to Q&A. Reen, you may open the line for questions.
Thank you. As a reminder, to ask a question, please press star one on your telephone keypad. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster.
Your first question comes from Stephen Grambling from Goldman Sachs. Your line is open.
Hey, good morning. Thanks for taking the questions. I guess maybe could you dig a little bit more into the economic model for each of the ALG segments, including maybe how margins compare and how similar or different contract terms are, and maybe even within the travel component. Will the Hyatt portfolio be immediately accessible or leveraged with those agencies? Thanks.
Thank you, Stephen, and good morning. We sort of look at the combined AMResorts and UVC units as a singular business line. They are highly integrated. That business line has a—the hotel management piece of that business line is similar to ours in terms of the actual mechanics of the business. That is, management fees associated with managing the hotels, and then separately, what we would describe as reimbursement for chain resources.
The actual model is similar, but the integration of UVC and that business is very expensive. Together, they represent a bit over 70% of the total earnings of the business at large, and the remainder is the ALG Vacations business. With respect to the vacations business, it is a high-volume and low-margin business, which is, I think, typical for travel distribution platforms such as ALG Vacations. It turns out that actually a number of Hyatt properties are already represented in a number of the ALG Vacations platforms. For example, the B2C platform, which is called BeachBound, has a number of Hyatt Resorts already represented on the platform. We think that there are a couple of major areas of opportunity there. First, Trisept Solutions is a proprietary platform for packaging.
Packaging sounds trivial, but it's actually very complex because if you're combining air and ground elements of a vacation, meaning the ground being hotel, and then you include transportation and excursions and you integrate those to deliver an integrated package, it's actually quite sophisticated. With the Mark Travel acquisition, the company gained a very powerful platform for packaging, something that we recognize as something that can be leveraged for other high-branded resorts and hotels. That's one dimension. The second dimension is that the Amstar business, which is a destination management company, is a business that is very experienced in working with providers of experiences, on-the-ground experiences in different markets around Mexico and the Caribbean and in Europe. Amstar is really focused on the Americas, but they have separate DMC relationships in Europe.
We see that as an opportunity to bring those experiences more into the opportunity set for Hyatt travelers to other Hyatt resorts. These are a couple of ways in which we see immediate opportunities. Over time, the ALG Vacations business has been quite strategic to the AMResorts expansion. We appreciate that about it as well.
That's helpful. If I can sneak one other one in, as we look at the next $2 billion in hotel sales, how would you think about the potential valuation or nuances of that portfolio relative to the $1.5 billion that you will be completing at this 17.4 x? Is there any differences in tax implications as well? Thank you.
Yeah. First of all, I'm thrilled to report that we now have signed one of the two deals that I mentioned on the last earnings call.
That relates to $350 million of the $500 million of sales. We expect to close that in the next several weeks. We are confident that we will be able to complete the other asset sale as well. Our outlook for the next $2 billion, this is going to sound very familiar to you because it's the same thing we said in the last one, which is we are expecting to sell those assets at 13x-15 x. We expect that the tax exposure could be around 15% in that range. We absolutely cherish our track record of underpromising and over-delivering. Stay tuned.
Thanks so much. Congrats on the deal.
Thank you. Your next question comes from Chad Beynon from Macquarie [Group] . Your line is open.
Hi, good morning. Thanks for taking my question.
When we think about the recent recovery, particularly in the Americas region, can you kind of help us think about how the AMResorts have been tracking against maybe visitation into those areas or any other type of RPI metrics that will kind of help us understand how we should think about their place in the market and then also how fast the recovery should be? Thanks.
Yeah. A couple of things that I would say. First of all, the AMResorts and AMR Collection hotels have been performing in similar veins to what we've talked about in relation to our own resorts. 2021 has been remarkable, increasing momentum over the last four- five months. We are seeing they are benefiting from the surge in leisure demand the same way that we are.
The booking volume through ALG Vacations has likewise increased at very rapid rates over the last several months and exceeding now 2019 activity levels in many cases. While we do expect a potential short-term slowdown in bookings, that is in relation to the season because the booking levels will come down in September - October and then rise again in November - December as we head into the festive season and into the first quarter, including spring break. That is a normal seasonal change. We also understand that the Delta variant might have other short-term impacts. I think that it is fair to say that the AMResorts' current activity base is holding up. They are not seeing a significant falloff in current, meaning in this month, activity. We are really encouraged to see the durability of their business base and their customer base. Okay. Great [crosstalk].
Mark, could you just elaborate a little bit more? If a customer moves towards a direct booking versus through the tour operator, which now you own, are the fees to Hyatt widely different? Are there any items that would keep a customer from booking direct? You mentioned that is part of the strategy. I am just trying to understand how you benefit from that, given that you will own the tour operator. Thank you.
Yeah. I think it is important for me to set the stage with respect to ALG Vacations. First of all, just recognize that 30% of ALG Vacations' volume is for U.S. destinations. By extension, you know that I will say that AMResorts operates nothing in the U.S. Really, all of that 30% is in relation to other volume into other resorts.
As I mentioned earlier, some of that is into existing Hyatt Resorts on some of their platforms. Of the 70% that is outside the U.S., that's primarily Mexico and the Caribbean, about 20%-25% of that volume goes to AMResorts, which means that the vast majority of all of the volume of ALG Vacations is actually with respect to third-party resorts. It is still very large. I mean, in 2019, I think ALG Vacations booked travel for 3.1 million passengers. It is a massive platform, and they have an incredible reach and a great brand reputation. The way we look at the strategy going forward is I think ALG Vacations provides remarkable capabilities for bookings into resorts, and especially has been focused on ALG resorts in the past.
I think the way in which ALG Vacations can actually provide extra support in shoulder seasons and the like has really been very valuable. It is also true that the way we look at all of this is through the lens of the owner. We are looking at the opportunity to extend and make more effective and efficient the total distribution cost. This is a journey that we at Hyatt have been on for years. We have really focused on increasing our direct channel. Our own digital channel has been growing at a very fast pace this year, exceeding the growth rate and the volumes of our OTAs. ALG management has also focused on direct channel expansion as well. They are on the same journey. We see the strategic value of ALG Vacations.
Just so you know, the base of revenue and activity at ALG Vacations is a majority of that is with respect to non-AMResorts hotels.
Thanks for the clarification. Congrats on the announcement. Thank you.
Your next question comes from Thomas Hallen from Morgan Stanley. Your line is open.
Thank you. Good morning. Can you just elaborate a little bit on the approximately $500 million from equity financing that you said you'll plan to do? Is that a traditional secondary offering? When do you expect to do it? Do you have to do it because of your credit agreement? Can you just elaborate a little bit? Thanks.
Sure, Thomas. Thank you. We're exploring various debt and equity financing options, but we've not made any decisions yet. We will be making more comments on this as time unfolds.
Okay. Makes sense.
Thinking back to 2017 - 2018 when you announced the Miraval and Two Roads acquisitions, it was similarly moving you down the path to more leisure exposure. In the current environment, that's very attractive. How do you think you've done on those two deals? And kind of what are the comparing those two deals to this deal? How should we compare them? Thanks.
Great. A couple of things that I would just note. The first is, let me just address specifically the Miraval and Two Roads experiences directly. I think it's important to understand how we intend to bring ALG on board at Hyatt. First, with respect to Miraval, we feel great about the trajectory of the hotels. They produced $7 million of adjusted EBITDA for the quarter, even with capped occupancy levels. That was due to constrained labor availability.
It's performing at or above our pro forma expectations on an annualized basis, albeit only now realizing the potential given the COVID disruptions. The principal issue that you need to understand about Miraval is that the property-level results met or exceeded our pro forma expectations. The lag in realizing the total earnings out of the property had to do with construction delays in the first instance and, unfortunately, COVID. Second, with respect to Two Roads, the first thing you should know is that we were on or better than planned with respect to our earnings forecasts before COVID hit. Very importantly, the growth in rooms under those brands has exceeded our pro forma expectations. We reported that we've already grown the Two Roads brands 20% year-to-date in 2021, and we expect to end the year with those brands having grown 30%.
I would say that we are on a post-COVID run rate base that is in excess of the expectations that we had going in, primarily because we've been able to grow those brands faster than we initially expected. Part of that growth is by virtue of the fact that we have expanded RevPAR Index for those hotels under those four brands at a double-digit rate over the last three years. Now, in Miraval and Two Roads, we had a couple of slightly different experiences in terms of what growth integration meant. In Miraval, we tried to keep the management of the resorts segregated or focused, I would say, but ultimately embedded in the overall superstructure of our hotel management business. The reason for that is the on-property guest experience is so specialized and so unique.
With respect to Two Roads, we actually fully integrated and created a new lifestyle division within the hotel management business, but that was a full integration. In both cases, we quickly identified ways in which we could extend distribution capabilities, marketing capabilities, our sales teams, and World of Hyatt to the benefit of those owners. You just heard from me on the Two Roads experience with that. ALG is going to be different in that we're bringing the entire team with the company, and it will operate as a separate unit. Alejandro Reynal, who's a superb leader, is going to be reporting to me directly and join the executive team of Hyatt.
The company will largely look the same way as it does now after we close, maintaining continuity for ownership and recognizing that this is a different business than our core hotel operating platform, primarily because the all-inclusive management base includes a very different distribution channel profile than ours does. Some of the operating metrics, operating modes, and processes that they use are also different. We learned this from our prior experience with Hyatt Zilara, and we have tremendous respect for that. We understand that it's a specialized management base. By the way, my expectation is that this is going to be a very powerful way for us to do this, primarily because with the huge amount of time we spent with the team at ALG, we recognize a remarkable cultural fit.
It's so unusual to be able to buy a platform with this much embedded growth focused in an area that has got a huge amount of wind at its back in a growing market in luxury leisure with a cultural fit that is hand-in-glove. They're focused on care, the personal relationships that they maintain with their own team members and with hotel owners. I mean, it is remarkably similar to how we operate and what we think about at Hyatt. Just to give you a quick example, I asked our head of communications if she had looked at the communications that ALG is sending out to their own team members and owners and so forth. She looked up and she said, "Mark, you'd be very happy because we could have written them." I mean, they look like they came right out of us.
That's a really important dimension of this that is too often overlooked in terms of how we're set up for success in the future.
Very helpful. Thank you.
Your next question comes from David Kitz from Jefferies. Your line is open.
I think that was me. Hi. Thanks for taking my question and sending the deal. I wanted to ask about fee structures and obviously focus on how we think about modeling these going forward. If there's any color you can provide on these fee structures compared with other deals that you've done versus the traditional management branch fees, that'd be helpful.
Thanks for that. I guess I'll just comment to say that the fee structure that they employ is a robust fee structure. It's reflective of the different dimensions of how the complexity of operating all-inclusive resorts, how resource-intensive it is.
The fee base itself is very robust. We will provide more details on the economics at that level of detail when we get closer to closing.
Okay. If I can go back to one of the topics we discussed earlier on, did you sort of set out any color on the timing of asset investors? I think you indicated there are a couple that are well underway now. How would we think about building this into our model one- four years?
The outside date that we have established is the end of 2024, which is three years out. I would just point out that we have always delivered earlier than our deadlines in the past. We certainly are going to be taking a proactive approach.
We have already begun a process of working through what we are going to be taking to the market. That process has already begun. We are going to be proceeding pretty quickly.
Got it. Very helpful. Thank you.
Gray, you will now take our last question, please. Thank you. Our last question comes from Michael Bellisario from Baird. Your line is open.
Good morning, everyone. If there is something you could provide, maybe some more details on ALG's growth from 2019 until now, maybe how did they grow, what was organic, what was inorganic, where did they grow, and then maybe what impact the pandemic had on their pipeline last year.
Thanks, Michael. Yeah. They grew in both the Americas and in Europe.
In Europe, they acquired a brand platform called Alua, which is a four-star, high-end four-star brand that has got a unique positioning in terms of style and design and the market position of the group. I would tell you that it's both been organic and inorganic. The pipeline that I described to you earlier is a reflection of how they have been successful in moving their core brands forward. A couple of things that I would just point out in color. First, 60% of their executed pipeline is under construction at this time. There is a significant number of other deals that are in advanced stages, some of which are already signed. I will tell you that the other point of consistency between how Hyatt does business and how ALG does business is they only count as pipeline deals that are fully executed and fully financed.
These are solid deals. If you took a look at what the signed, executed, and financed deals are, it represents about 23% of their existing room base. If you look at additional signed contracts, contracts that have already been signed but not deemed financed by the management team yet, that adds another 7%. You are now at 30%. If you look at the remaining that are in advanced and final negotiation stage, that is another 32%. All told, if you look at the momentum and the backdrop, it is very high. They had, to my knowledge, either no or extremely low attrition in the pipeline over the past year. Europe continues to grow at a very good pace. We are very excited about that for obvious reasons. The Alua brand, like the other brands, is really performing.
They have different base of owners, more institutional ownership in Europe and more family ownership, family enterprise, and family office ownership in the Americas. In terms of expansion, I would say a couple of other things as well, which is they are only beginning to scratch the surface of the five-star luxury market in Europe. We believe that extending the five-star brands, the luxury brands, rather, in the portfolio into Europe is another leg of growth. There likely is an opportunity with respect to a distinct and differentiated four-star experience in the Americas. We think that there's continued growth in existing markets. Really, in terms of thinking about this over the next 5 - 10 years, this is a business model in all-inclusive that provides superior economics for owners and great returns on investment. It's going to be a preferred format.
It is growing at a faster rate than traditional resorts. I think that that same model can and will apply in the Middle East and in Asia. With our brand reputation in Asia and our owner relationships there and in the Middle East, we see a tremendous amount of leverage to accelerate what they're doing and really make this a really robust and superior brand platform around the globe.
Got it. Very helpful. Thank you.
Thank you. Thank you, everyone [crosstalk]. We'll hand it over back to Mr. Noah. Go on, please.
Thank you, everyone [crosstalk], for taking the time to join us today. Take care, and we look forward to speaking with you all soon.
Thank you. Goodbye [crosstalk]. This concludes today's conference call. You may now disconnect.