CEO says Hilton exploring new hotel brand for 2014
Hilton Worldwide Holdings Inc., which began trading shares on the New York Stock Exchange on Thursday, expects to introduce a new hotel brand in 2014 aimed at affluent, young travelers by emphasizing style and design.
Chief Executive?Christopher Nassetta?said Hilton is exploring plans for a boutique hotel, or “lifestyle” brand. It would aim to compete with W Hotels, a brand developed by?Starwood Hotels & Resorts Worldwide?Inc.,?HOT?+1.44%?and?Marriott International?Inc.MAR?+0.02%?’s fledgling Edition hotels, which the company is developing with famed hotelier Ian Schrager.
“It’s something we’re working on,” Mr. Nassetta said in an interview at the stock exchange, where Hilton shares rose 7.5% to $21.50 on their first day of trading. Hilton sold 117.6 million shares Wednesday, raising about $2.35 billion in the largest-ever hotel initial public offering.
Hilton ended the day with a market value of about $21 billion, compared with $14 billion for both Starwood and Marriott.
Hilton has 10 brands and a wide range of hotels, from limited service properties like Hampton Inn to luxury names like Waldorf Astoria and Conrad.
But Hilton has been mostly frustrated in its efforts to add a boutique brand to its roster. About five years ago, the McLean, Va., hotel operator identified a lifestyle brand as a major growth initiative for the company, and Mr. Nassetta and his team were developing one that was dubbed Denizen.
Hilton already had begun talks with developers in Abu Dhabi, London, Mumbai and New York about establishing Denizen hotels when it was hit with a 2009 lawsuit by Starwood, which alleged that Hilton was using stolen confidential documents to develop the new chain.
Hilton eventually settled with Starwood, which included a cash payment to Starwood and an agreement that prevented Hilton from entering the lifestyle segment for two years. That prohibition expired in January, but Hilton has been quiet about any plans for a boutique brand since.
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