If you need a bed for the night, Hilton Worldwide (formerly Hilton Hotels) has a few hundred thousand of them. The company is one of the world's largest hoteliers with a lodging empire that includes more than 3,900 hotels and resorts in some 90 countries operating under such names as Doubletree, Embassy Suites, and Hampton, as well as its flagship Hilton brand. Many of its hotels serve the mid-market segment, though its Hilton and Conrad hotels offer full-service, upscale lodging. In addition, its Homewood Suites chain offers extended-stay services. The company franchises many of its hotels; it owns the Waldorf-Astoria and the New York Hilton. Hilton is owned by private equity firm The Blackstone Group.
With its extensive portfolio of brands, Hilton seeks to serve multiple segments within the lodging sector. The company's largest chains, Hampton Inn and Hampton Inn & Suites, include about 1,700 locations and target mid-market travelers with moderately priced rooms and limited amenities. Nearly all its Hampton hotels are operated by franchisees or by the company under management contracts with third-party owners.
At the other end of the scale, the company's Conrad chain offers luxury services and distinctive locations, while its Waldorf-Astoria Collection is a prestigious collection of hotels inspired by the New York landmark. The company's Hilton Grand Vacations subsidiary operates about 50 time-share vacation resorts, with a concentration located in Florida.
Hilton is in the middle of a growth period as the global markets begin to improve. In 2011 its newest brand, Home2 Suites by Hilton, opened its first property. Hilton plans to have 100 Home2 Suites, which operate in the mid-tier extended stay category, in North America by 2014.
Plans for another new brand, Denizen Hotels (designed to cater to globally conscious modern travelers), were scrapped after rival Starwood Hotels & Resorts filed a lawsuit against Hilton claiming it employed corporate espionage. The suit charged that Hilton employees (who had formerly worked at Starwood) used confidential and proprietary documents from Starwood to help create Denizen. The two companies ended up settling out of court in 2010; Hilton paid Starwood some $75 million.
Through new management, franchise, and/or development contracts, in 2012 and 2011 Hilton announced the addition of properties to its portfolio in Azerbaijan, Bangladesh, Brazil, China, Croatia, Egypt, Germany, India, Kazakhstan, Mexico, Nambia, the Netherlands, New Zealand, Russia, Saudi Arabia, South Africa, Turkey, the UAE, the UK, the US, and Vietnam.
The relocation of Hilton's corporate headquarters from Beverly Hills, California, to the Washington, DC, area occurred in 2009. The move was prompted by a desire to tap into local real estate and hospitality expertise. (The DC area is also home to rival Marriott, as well as smaller players such as Choice Hotels International, Host Hotels & Resorts, and Interstate Hotels & Resorts.) Also, the move put Hilton's HQ in closer proximity to other key corporate locations, including Dallas; Memphis; Orlando, Florida; and London. Following the relocation, the company changed its name to Hilton Worldwide to better reflect its global operations.
Change in Company Type
Blackstone took the company private in 2007 through a $26 billion buyout that included about $6 billion in assumed debt. It was the largest private equity buyout in the hotel industry. The private equity giant already owned such hotel assets as LaQuinta Inns and Suites (owned through LQ Management) and LXR Luxury Resorts & Hotels (operated by WHM). It made the deal to develop luxury brands, the most competitive market in the hotel business. In 2010 Blackstone led a restructuring of Hilton's existing debt, reducing its total debt by nearly $4 billion. – less