Venture Bringing Hilton’s Conrad Brand To U.S.

LONDON & BEVERLY HILLS, CA— Hilton Group Plc and Hilton Hotels Corp. have formed a joint venture company to expand the luxury Conrad Hotels brand worldwide. Clement Barter will serve as president for the joint venture, which will be based in Brussels and owned equally by Hilton Group and Hilton Hotels Corp. Combining forces will facilitate the expansion of the Conrad brand, according to Dieter Huckestein, president/hotel division for Hilton Hotels Corp. “Conrad, an aggressive luxury brand, already has international brand recognition,” Huckestein said, noting the brand’s 12 properties are spread across four continents with locations in Turkey, Hong Kong, Singapore, Egypt, Australia, England, Ireland and Belgium. He added that the joint venture will give Hilton the opportunity to focus on the luxury market in the United States. Huckestein said that Americans who travel overseas and stay at Conrad hotels will be attracted to the brand’s properties in the U.S., as will international travelers familiar with the Conrad name. He noted that “many [of Conrad’s]customers are from the U.S.” but “there is approximately a 35% customer base in Hong Kong as well.” The brand, which will not be franchised, “could easily have boutique properties,” Huckestein said, although currently some Conrad hotels have as many as 600 rooms. He added that the Conrad brand will not have cookie-cutter properties. “Each hotel has its own personality and blends into the environment and culture that it is a part of.” According to Huckestein, the Hilton Group Plc and Hilton Hotels Corp. alliance includes a joint reservations system, combined sales and marketing programs, unified logo and advertising campaign and inclusion in the Hilton HHonors loyalty program. The strategy of the Hilton joint venture will be to expand the Conrad brand by securing management contracts for newly constructed properties as well as conversion properties, Huckestein noted. “We may take a small equity in some of the properties,” he said. Selected portions of existing Hilton properties are being eyed for possible Conrad representation, including the Waldorf=Astoria Towers in New York City and the Drake Hotel in Chicago. “We’re pursuing opportunities aggressively, and have nearly 50 potential deals in the international pipeline,” said Huckestein. He added that the brand wants to be represented in all major gateway cities. At presstime there were an additional two properties in developmental stages. The 400-room Conrad Bangkok in Thailand is slated to open in 2002 and the 700-room Conrad Jakarta in Indonesia is scheduled to be launched in 2004. Hilton Hotel Corp.’s other existing brands represented in the U.S. include Doubletree; Embassy Suites Hotels; Hampton Inn/Hampton Inn & Suites; Hilton Garden Inn; Hilton Hotels & Resorts; Homewood Suites by Hilton; and Red Lion Hotels & Innst.