|Hilton Hotels Corporation
|Traded as||NYSE: HLT|
|Headquarters||7930 Jones Branch Drive, Tysons Corner, Virginia, United States
(McLean mailing address)
Number of locations
|Christopher J. Nassetta (President and CEO)|
|Revenue||$8.0 billion (2013)|
Number of employees
162,000 franchise employees
|Parent||Blackstone Group (43%)|
Hilton Worldwide Holdings, Inc. (formerly, Hilton Worldwide and Hilton Hotels Corporation) is an American global hospitality company that manages and franchises a broad portfolio of hotels and resorts. Founded by Conrad Hilton in 1919, the corporation is now led by Christopher J. Nassetta.
As of January 2016, Hilton Worldwide's portfolio includes 4,610 hotels with over 758,502 rooms. In January 2016, the opening of the Hilton in Chad marked the 100th country Hilton resides in, thus making the corporation the largest hotel chain in the world by rooms and international presence. Prior to their December 2013 IPO, Hilton was ranked as the 36th largest privately held company in the United States by Forbes.
Hilton Worldwide has 13 brands across different market segments including Conrad Hotels & Resorts, Canopy by Hilton, Curio – A Collection by Hilton, Hilton Hotels & Resorts, DoubleTree by Hilton, Embassy Suites Hotels, Hilton Garden Inn, Hampton Inn, Homewood Suites by Hilton, Home2 Suites by Hilton, Hilton Grand Vacations and Waldorf Astoria Hotels & Resorts. In January 2016 Hilton unveiled its new midscale-market brand, Tru by Hilton.
On December 12, 2013, Hilton again became a public company in its second IPO to raise an estimated $2.35 billion.
Conrad Hilton founded the company in Cisco, Texas in 1919 and established headquarters in Beverly Hills, California from 1969 until 2009. The company moved to Tysons Corner, unincorporated Fairfax County, Virginia, near McLean in August 2009.
The company has been a sponsor of the United States Olympic Team since 2005.
Hilton was founded by Conrad Hilton in 1919 with the purchase of the 40-room Mobley Hotel in Cisco, Texas. Over the following several years, Conrad purchased more hotels in Texas. While business was strong, he had greater ambition.
In 1925, Hilton opened the first high-rise building in Dallas, Texas. The Dallas Hilton would become the first hotel to carry the Hilton name on its building (though the building is now not operated by Hilton Worldwide). Uniquely because air conditioning was not yet invented, elevators, laundry chutes, and other non-guest facilities were placed on the west side of the building - so no guest would face the western sunset. In 1927, Hilton expanded to Waco, Texas where he opened the first hotel with air-conditioning in public areas and cold running water.
In 1943, Hilton purchased the Roosevelt Hotel and the Plaza Hotel in New York. This would create the first coast-to-coast hospitality company in the America. Then in 1947, he created the Hilton Hotels Corporation, leading the new company to be publicly listed on the New York Stock Exchange. In this same year, Hilton's Roosevelt Hotel would be the first ever in the world to offer television sets in all guest rooms.
Hilton International was born a few years later (in 1949) with the opening of the Caribe Hilton Hotel in Puerto Rico. It would be at this property that the legendary barman Ramon "Monchito" Marreno would create the alcoholic Pina Colada drink. This same year Hilton purchased what he said was "the greatest of them all," the Waldorf Astoria New York. Conrad Hilton was featured on the cover of Time Magazine, the only hotelier at the time to have been so.
The Hotels Statler Company was acquired in 1954 for $111,000,000 in what was then the world's most expensive real estate transaction. One year later, Hilton created the world's first central reservations office titled "HILCRON." The reservations team in 1955 consisted of eight members on staff booking reservations for any of Hilton's then 28 hotels. Reservations agents would use the "availability board" to track records. The chalk board measured 30 feet by 6 feet, and allowed HILCRON to make over 6,000 reservations in the year. Bookings could be made for any Hilton via telephone, telegram, or Teletype. Later in 1955, Hilton launched a program to ensure every hotel room would include air-conditioning. In late 1955, Hilton opened the first post World War II property in Istanbul. The 499-room Hilton Istanbul became so famous that it earned its own zip code and postal stamp.
Hilton is credited with pioneering the airport hotel concept with the opening of the San Francisco Airport Hilton in 1959. In 1965, Hilton launched the Lady Hilton, the first hotel designed for women travelers. The hotel features women only floors and guest rooms, and had amenities only for women. Hilton became the first hospitality company in September of the same year to create the franchise concept. This allowed a hotel to operate under the Hilton name to utilize company systems and brand recognition, but would not be operated by Hilton Worldwide, instead by a private party. In 1969, the first DoubleTree Hotel opened. At the time, Hilton was not affiliated with the brand until its acquisition of the parent company in 1999.
When Hilton purchased the Flamingo Las Vegas in 1970, the company would become the first in the domestic gaming business to be listed on the NYSE. In 1979, founder Conrad Hilton passed away at the age of 91. Hilton Hotels Corporation later created the Conrad Hotels brand in honor of Mr. Hilton. The brand focuses on operating four or five-star luxury hotels in the world's tourism destinations or capitals.
Hilton HHonors, the company's guest loyalty program, was initiated in 1987. In 1994, the Hhonors surpassed competing hotel loyalty programs by offering members both hotel credit points and airline credit miles.
Two chains with one name
The company spun off its international operations into a separately traded company on December 1, 1964, known as Hilton International Co.. It was acquired in 1967 by Trans World Corp., the holding company for Trans World Airlines. In 1986, it was sold to UAL Corp., the holding company for United Airlines, which became Allegis Corp. in an attempt to re-incarnate itself as a full-service travel company, encompassing Westin Hotels and Hertz rental cars in addition to Hilton International and United Airlines. In 1987, after a corporate putsch, the renamed UAL Corp. sold Hilton International to Ladbroke Group plc, a British leisure and gambling company, which, in May 1999, adopted the name Hilton Group plc.
As a result, there were two separate, fully independent companies operating hotels under the Hilton name. Those Hilton Hotels outside the U.S. were, until 2006, styled as Hilton International hotels. Because the two chains were contractually forbidden to operate hotels in the other's territory under the Hilton name, for many years hotels run by Hilton International in the U.S. were called Vista International Hotels, while hotels operated by the American arm of Hilton outside the U.S. were named Conrad Hotels.
In 1997, to minimize longtime consumer confusion, the American and British Hilton companies adopted a joint marketing agreement under which they shared the same logos, promoted each other's brands and maintained joint reservation systems. At that point, the Vista chain was phased out, while Conrad has been restyled as one of the luxury brands of Hilton (along with The Waldorf-Astoria Collection) and operates hotels within the U.S., as well as abroad.
In 1998, Hilton spun off its gaming operations into a separate, publicly held company called Park Place Entertainment (later Caesars Entertainment, Inc.)
In 2001, Hilton agreed to sell Red Lion to WestCoast Hospitality.
On December 29, 2005, Hilton Hotels Corporation agreed to re-acquire the Hilton International chain from its British owner, Hilton Group plc, for GBP 3.3 billion (or $5.71 billion). As well as bringing the two Hilton companies back together as a single entity, this deal also included Hilton plc properties operating as Conrad Hotels, Scandic Hotels and LivingWell Health Clubs. On February 23, 2006, the deal closed, making Hilton Hotels the world's fifth largest hotel operator in number of rooms. Hilton Group PLC (headquartered in the UK) then renamed itself Ladbrokes plc.
On July 3, 2007, Hilton Hotels Corp. agreed to an all-cash buyout from the Blackstone Group LP in a $26 billion (including debt) deal that would make Blackstone the world's largest hotel owner. The deal was the culmination of a year of on and off discussions with Blackstone.
The private equity group said it would combine cash from its real estate and corporate private equity funds to buy all outstanding Hilton shares for $47.50 each, a 32 percent premium over the July 3rd closing stock price.
In October 2007, Christopher J. Nassetta was appointed President and Chief Executive Officer of Hilton.
In February 2009, Hilton Hotels Corp., announced that its headquarters were moving from Beverly Hills to Fairfax County, Virginia.
While Blackstone saw an opportunity to streamline the company and push Hilton's expansion overseas when Blackstone pursued Hilton in 2006 and 2007, the buyout saddled the company with $20 billion of debt just as the economy was turning down. The debt had very liberal terms, so there was no danger of default, but when travel slowed, the company suffered. In April 2010, Hilton and Blackstone restructured the debt. Blackstone invested a further $800 million of equity and the debt was reduced to $16 billion.
On September 12, 2013, Hilton filed plans for a $1.25 billion IPO.
It was announced in Q4 2015 that Hilton Worldwide Holdings would turn its hotel holdings into a real estate investment trust. Prior to making the announcement, the company went to the IRS for approval.
The company began a focus on strategic growth, opening nearly one new property per day in 2015. In all, a record 100,000 rooms were signed to commitment, added to the 275,000 rooms in the development pipeline for Hilton.
- Canopy by Hilton
- Denizen Hotels (Defunct)
- Lady Hilton (Defunct)
Many of Hilton's properties are franchised to independent operators and companies. This business practice has proven successful in rapidly expanding the various Hilton brands to markets all over the United States. Franchisees must follow strict brand standards in order to maintain a licensing agreement with Hilton Worldwide. The Hampton Inn brand is virtually 100% franchised with the minor exception of a few properties that are corporate managed for various reasons. All franchised hotels are regularly inspected by a Quality Assurance Team to enforce brand standards and consistency.
The practice of franchising is popular within the hospitality industry among most major hotel chains, especially among smaller brands with a fair number of locations which are not feasible to be corporately owned and managed by the company. Competitor companies, such as Marriott International and Starwood, follow a similar business model that focuses on franchising as a rapid expansion method.
Most of Hilton's flagship properties, airport properties, and largest resorts, however, are corporately managed.
The company has its headquarters in Tyson's Corner, Virginia and an operations center in Memphis. Its Asia-Pacific operations are managed out of Singapore and its Middle East and Africa operations are managed out of the Dubai Internet City Building 15. Its European operations are based out of Watford, United Kingdom.
Hilton HHonors is Hilton's guest loyalty program in which frequent guests can accumulate points and airline miles by staying with the various Hilton family of brands. The Hilton Honors program is one of the largest programs of its type, with over 30 million HHonors members. The program has partnerships with most major airlines where guests can "Double Dip" and accumulate both points and airlines miles simultaneously with their hotel stay. Similar to frequent flyer programs, there are various tiers of membership which guests can reach depending on the amount of stays and points accumulated annually, the higher the tier the more benefits members receive. The membership tiers are as follows:
- Blue (obtained upon enrollment)
- Silver VIP (obtained after 4 stays or 10 nights)
- Gold VIP (obtained after 20 stays, 40 nights, or 75,000 base points)
- Diamond VIP (obtained after 30 stays, 60 nights, or 120,000 base points)
Diamond VIP is the highest tier level, these members receive benefits such as access to the Executive Level lounge at Hilton Hotels, complimentary in-room internet access, Guaranteed 48-hour reservations, a dedicated "Diamond VIP Desk" which members can call for priority reservations and travel planning, a dedicated VIP check in line at larger hotels, best available room pre-assignments, and special in-hotel amenities such as room upgrades and arrival amenities.
The program has seen significant growth in China, which alone saw a 79 per cent increase in Hilton HHonors membership in 2011. This was attributed in part to the refining of the brand identity in China, including the addition of a Chinese name and a Chinese website for customers to sign up and redeem their points.
Hilton in popular culture
John Lennon and Yoko Ono honeymooned in the presidential suite at the Hilton Amsterdam where they hosted their famous "Bed-In" for a full week in 1969. In 1971, Diamonds Are Forever was filmed at the Flamingo Hilton.
On April 3, 1973, Dr. Martin Cooper made the world's very first cell-phone call in front of the New York Hilton. A mass press-conference would later be held at the hotel the same day to mark the milestone. The Bodyguard with Whitney Houston and Kevin Costner was filmed at the Fontainebleau Hilton in Miami in 1992.
In 1995, the James Bond movie Goldeneye was filmed at the Langham Hilton. The Insider filmed in 1999 at the Seelbach Hilton. In 2006, six movies including Spiderman III, Michael Clayton and American Gangster were filmed at the New York Hilton.
Conrad Hilton (played by actor Chelcie Ross) features as a major character in the third season of Mad Men as lead character Don Draper creates a series of ad campaigns for Hilton Hotels. The Drapers travel during one episode to the Cavalieri Hilton in Rome, though the scenes were actually shot at the Dorothy Chandler Pavilion in Los Angeles.
The popular Hilton HHonors guest loyalty program was featured in the 2009 film Up in the Air, as a means of product placement in which various characters present their branded Hilton HHonors membership cards to check into Hilton hotels throughout the film.
According to Careerbliss.com, Hilton Worldwide ranked first in the '2012 Happiest Companies in America', with a score of 4.36 out of 5. The survey looked at job reviews from more than 100,000 employees such as characteristics like work-life balance, company culture and reputation, and the relationships employees have with their bosses.
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