I must say that after decades and many thousands of room nights across the globe both elite and non elite its very rare
Its happened 3 times to me
2 @ Hyatt Place lol
and one at the Sheraton JFK
A property that barely qualifies for a Sheraton 4 Points with the worlds most dangerous parking lot

I was actually facinated when it finally happened at Hyatt Place as I called from DFW and they knew then they had no rooms yet
let me come anyway for my personal pleasure of traveling there for no reason

And the second time just days later at the same Hyatt Place 2:30 PM with an empty parking lot they refused check in saying they were
having a private catered party for the hotels owners (and I repeat)

Mind you I respect their reason to deny a Diamond member their booking as hotel owners have a right to refuse all Hyatt guests before arrival
What I'll never understand for the life of me is why take the booking and not call the guest in advance so they can make alternative plans when you know they are going to walk Diamonds and everyone else previously booked?

That's why an iron clad policy is essential at Hyatt Place and elsewhere to give the incentive to act responsibly to all guests....