SAO PAULO— Looking toward greater expansion in the Latin/South America sphere, Hilton International next month will open a $90 million full-service property here, jumpstarting what it hopes will be a stronger presence in a market where it’s often languished since arriving decades ago. The 485-room Hilton Sao Paulo Morumbi, set to open Sept. 30, is the chain’s largest investment in the marketplace and is slated to be the flagship in Brazil for the chain. “This hotel should be the springboard for future expansion. When you look at Latin America, the subcontinent is massive and the opportunities are massive,” said Howard Friedman, president/the Americas for Hilton International, which has four more properties, plus seven other hotels throughout Latin/South America. (The chain terms the entire area simply Latin America.) “If you track our record in Latin America over the last 30 years as a brand, I think it’s fair to admit it’s under performed in terms of our expansion and our brand presence.” The chain last opened a property in the market two years ago when its Buenos Aires hotel came online, and Friedman actually categorizes the opening of the Morumbi hotel as a “relaunch” of the brand. The executive tagged several reasons for the stunted distribution: “The business wasn’t adequately decentralized. We have a lot more decision making power now at my area level; we are, by definition, a European company and probably always will be. The political and economic ups and downs of Latin America don’t help. We are a plc, a public company, and we look at security and all the good things that go into an investment decision; and traditionally, we have not franchised as an organization. We’re slowly moving more toward that business model.” The new property will be the hotel component of the Centro Empresrial Nacoes Unidas (CENU) complex, located in Sao Paulo’s new financial district. However, the hotel is a wholly owned asset of Hilton International, and is “self-financed,” said Friedman. “This is our money; it’s pure equity.” The Hilton is the third tower of the privately held CENU complex, with a “significant retail concourse underneath,” said Friedman. The tower was originally designed with foundations laid as a 28-story office building. “CENU was in a lease-up phase on the first two towers. Then we approached it about a possible conversion into an hotel.” The chain had spent six months with consultants to determine if the building would be convertible, and another six months negotiating the acquisition of the land and the foundations. The entire project took three-and-a-half years to complete. To keep the complex harmonious, Hilton International used CENU’s architect to finish the building, but used its own interior designers. The leading challenge, said Friedman, stemmed from not being a development company. “Can you construct a hotel yourself in Brazil or can you construct a hotel in any country by yourself, being just the project manager? That was issue number one.” The company pulled in Miami, FL-based Roger Jennings, vp/technical services for Hilton International, who ran his own construction company for many years. “We also had a man on the ground in Brazil, Daniel Solis, a very experienced Latin American project manager. We also hired some consulting firms just to give us the comfort of cost control, value engineering, etc. So it was well staffed from the beginning. We had made mistakes before and we learned from them,” said Friedman. Friedman is hoping to leverage the new property against a competitive set that includes Marriott, Inter-Continental and Spain’s Sol Meliá. “We sat back three years ago and said: ‘What do we need to do in Latin America to create a more visible presence for Hilton, to elevate the brand, to become the brand of choice for the business traveler? And to become the brand of choice for other potential developers and investors?’ Which is what this is all about. Our objective for this hotel i
