Conrad Nicholson Hilton was a prominent American businessman. He was the founder of the Hilton Hotel empire and grew it into one of the largest private companies in the United States, consisting of over 3600 hotels worldwide. Hilton was also one of the first persons who introduced into this business a 1-5 star hotel rating system. In addition, he managed to combine hotels with restaurants and casinos.
Background
Ethnicity:
Conrad Hilton's father was of Norwegian descent, while his mother had German ancestry.
Conrad Nicholson Hilton was born on December 25, 1887, in San Antonio, New Mexico, the United States. He was one of eight children born to August Hilton, a Norwegian immigrant who arrived in the United States in the 1860s, and Mary Laufersweller, who was of German extraction.
August Hilton was a trader, but at one time or another, he engaged in a wide variety of other businesses. He ran a general store and the local post office, operated the New Mexico State Bank, dabbled in gold mining and refining, and sold farm equipment. Among his holdings was $2.50-per-night boardinghouse, where his son had his first experience in the hotel business.
As a boy in the little New Mexican desert town of San Antonio, Hilton helped his enterprising father turn the family’s large adobe house into an inn for traveling salesmen.
Education
Hilton attended the Goss Military Academy (since renamed as the New Mexico Military Institute) and St. Michael's College (now Santa Fe University of Art and Design). In 1907 Hilton entered the New Mexico School of Mines at Socorro but dropped out in 1909 before being awarded a degree. During vacations, he worked as a telegraph operator and day laborer.
After leaving college Hilton joined his father's bank and dabbled in politics, serving two sessions (1912-1913) in the state legislature. Hilton soon lost interest in government and returned to work at the bank. He joined the United States Army in 1917 and served in France in the Quartermaster Corps. Hilton returned to New Mexico in January 1919, following his father's death in an automobile accident the preceding month. He then took over his father's several businesses. In 1919, Hilton tried to purchase a bank in Cisco, Texas, a town then in the midst of an oil boom, for $5, 000. He failed in this attempt and instead, with his partners, L. M. Drown and Jay C. Powers, purchased the fifty-room Mobley Hotel in the city for $10, 000. Finding the hotel business both to his liking and quite profitable, Hilton explored other properties in Texas. Later that year he purchased the Hotel Melba in Fort Worth, and the following year he acquired the 150-room Waldorf in Dallas. Others followed. By 1923, Hilton owned five hotels in Texas, with a total of 530 rooms and a value of around $250, 000. At the end of the decade, he was the largest hotel operator in the region.
Hilton came close to losing everything during the early years of the Great Depression. He closed down entire floors in his hotels, dismissed maids and other support staff, and removed telephones to save whatever he could. He even took a job at the rival Affiliated National Hotels to earn money. The turning point came in the second half of the 1930s when the regional economy started to improve. Hilton changed his method of operation to suit the new situation. As he put it, "Up 'til then I had used two forms of operation. First, leasing my Texas dowagers and rejuvenating them, then building from the ground up on leased land, again in Texas. " This was well enough during periods of prosperity, but in the depression scores of fine hotels had fallen into foreclosure and were acquired by speculators who knew next to nothing about hotel management. These properties now were being marketed aggressively and could be had at bargain prices. In 1935, Hilton purchased one such hotel, the Paso del Norte in El Paso. The second was the Gregg, in Longview, which he bought from a local doctor who discovered how difficult it was to run a hotel. Not only did Hilton obtain the property at far less than its value, but the doctor offered to lend the money for renovations. "This was as close as I ever came to being given a hotel, " wrote Hilton.
While renovating existing properties, Hilton started buying distressed hotels on the West Coast, beginning in 1937 with San Francisco's Sir Francis Drake, a twenty-two story building with 450 rooms, which had cost $4. 1 million to construct. Hilton and his group acquired the Drake for a cash outlay of $275, 000. He then bought the Breakers, a bankrupt operation in Long Beach, Calif. Hilton settled the hotel's tax liabilities of $280, 000 for $61, 038, and then purchased its deeply discounted debt of $1 million for $110, 000. He next turned inland, erecting a hotel in Albuquerque, New Mexico, the Albuquerque Hilton, which opened for business in 1939. In 1943, Hilton bought the Hotel Roosevelt in New York City, and that October purchased the famed Plaza, at Fifth Avenue and Fifty-ninth Street, for $7. 4 million. He also purchased the Town House in Los Angeles (1942) and the Mayflower in Washington. (1946), which ranked among the world's premier hostelries. His motto became "Across the Nation. " These acquisitions marked a new phase in Hilton's career; now he was going after some of the nation's most prominent and largest hotels. The Stevens in Chicago was the largest hotel in the world, with 2, 673 rooms. Like the other bargains Hilton acquired, it was in the midst of bankruptcy reorganization.
In 1945 he began his campaign by buying up as many of the hotel's bonds as he could, at 25 cents on the dollar, accumulating $400, 000 of them, then moved in to take over, for a total cost, including renovations, of $7. 5 million. He renamed the Stevens the Conrad Hilton Hotel. The prize was Chicago's Palmer House, which in 1946 cost Hilton more than $19 million.
Hilton Hotels was incorporated in 1946, and the following year its common stock was listed on the New York Stock Exchange. This changed the structure of the Hilton holdings. Until then, each hotel operated as a stand-alone entity, controlled by Hilton but most of them with minority partners. Now the original securities holders were given Hilton stock in exchange for their interests. Hilton became the largest shareholder in the new entity, with stock worth over $9 million. In the early 1940s, Hilton obtained his first foreign holdings, starting out in Mexico, and then on to Europe. As a result, he was well situated to capitalize on the tourism and business boom after World War II.
In 1948, Hilton founded Hilton Hotels International, signaling his intention to concentrate more on foreign operations. His motto now became "World Peace through International Trade and Travel. " The slogan "Across the Nation" was replaced by "Around the World. " The first of the foreign hotels was the Castellana Hilton in Madrid (1953), which had been started by others and which Hilton bought out. In 1964, Hilton International shares were distributed to Hilton stockholders. In 1949, Hilton capped his acquisitions spree with the $3 million purchase of controlling interest in the prestigious Waldorf-Astoria in New York City, which was acquired by Hilton Hotels in 1953.
Now sixty-six years old, Hilton seemed content to rest on his laurels. "There's not much left to look around for when you get the Waldorf-Astoria. " But there was more to come. In the early 1950s, Hilton became interested in the Statler chain of hotels, which had assets of over $110 million. Webb and Knapp, the real estate conglomerate directed by William Zeckendorf, made an offer for the decrepit chain, but Alice Statler, widow of the founder, did not want it to fall into the hands of nonhotel people. She was receptive to Hilton's willingness to make an offer of his own. So he did, it was accepted, and in 1954 Hilton acquired control of Statler for $100 million.
In 1958, Hilton organized Hilton Credit Company to operate Carte Blanche, a credit card company, to which Hilton Hotels transferred its credit-card lists, credit files, and other materials.
In the 1950s, Hilton acted to standardize the newer hotels. He did so in the hope that businesspeople, then accounting for an increasingly large share of guests, would know what to expect from a Hilton. Although he sensed that a new age had arrived, Hilton's hotels remained in central cities, close to railroad terminals but far from airports. The age of air travel and automobile throughways had dawned, but Hilton was unprepared to capitalize upon it. In his later years, he missed opportunities and seemed to lose the decisiveness that made his empire possible. Not until later did he build hotels in suburbs and near highways. Hilton missed the motel boom; Kemmons Wilson recognized the opportunities of building a motel chain and created Holiday Inns, which might not have been so successful had Hilton moved more quickly. Carte Blanche was mismanaged and never amounted to much.
Bigger mistakes were to come. In 1964 William Barron Hilton, his second son, had visions of a resort-hotel network connected by air links. In order to accomplish this, the company would need an airline. After several feints, Barron urged his father to exchange Hilton International for a stake in Trans World Airways, which was done in 1967. In the years that followed, Hilton International thrived while TWA did poorly. The franchise business, initiated in 1966 under the name Statler Hilton (which later became Hilton) was managed timidly and lost out to Holiday Inn, Marriott, Sheraton, and others. By then Conrad Hilton had withdrawn from active management of the company. Barron Hilton, now president, took over from his father.
Hilton was a supreme opportunist, recognizing that during the last years of the Great Depression and the next two decades, values were out of line and business expansion would translate into large profits.
Toward the end of his career, however, Hilton made several errors of omission and commission, and so his empire was not as strong or as large as it might have been having he exercised the same imagination he had shown earlier. Until Hilton's activities in his growth period, most major hotels were individualistic, possessing characters of their own that were prized and preserved by on-site owners. Hilton saw value in this and attempted to acquire existing hotels with such reputations. "I buy tradition and make the most of it, " he once said. But Hilton also created and directed a chain of hotels, most of which were franchised, where travelers knew they could receive a degree of standardized treatment. At the time of his death in Santa Monica, California, his company-owned or franchised 185 hotels and inns in the United States and 75 in foreign countries, ranging from Mexico City to Istanbul.
Hilton was one of the most prominent American businessmen of his time. He established the Hilton Hotel empire and grew it into one of the largest private companies in the United States, consisting of over 3600 hotels worldwide. Hilton Hotels' worldwide expansion facilitated both American tourism and overseas business by American corporations. It was the world's first international hotel chain, at the same time establishing a certain worldwide standard for hotel accommodations.
Besides his business accomplishments, Hilton created the Conrad N. Hilton Foundation, which awards an annual prize to exemplary organizations that work to end suffering in the world. It also supports programs for the blind and the homeless as well as education initiatives.
When the state of New Mexico was created in 1912, Hilton was elected to its Legislature Assembly on the Republican ticket. He served the assembly for two terms but the governmental red tape, as well as underhand deals soon, frustrated him.
Views
In 1944, Conrad Hilton formed Conrad N. Hilton Foundation with the aim of "improving the lives of disadvantaged and vulnerable people throughout the world." Before his death, he bequeathed the bulk of his properties to this foundation.
In his 1957 autobiography, Be My Guest, Hilton spelled out the company’s key ideas:
1. Each hotel has its own personality.
2. Forecasting - knowing the seasonality of the business and adjusting accordingly.
3. Mass purchasing for the whole chain to save money.
4. Digging for gold - finding “waste space” and wringing profits out of it.
5. Training, including the use of hotel schools (Conrad funded the Hilton School at the University of Houston).
6. Powerful sales, advertising, and publicity, including groups and conventions.
7. Integrated reservations systems to make it easy for guests to book Hilton hotels.
In the same autobiography, he laid out his "rules for living":
1. Find your own particular talents.
2. Be big. Think big. Act big. Dream big.
3. Be honest.
4. Live with enthusiasm.
5. Don’t let your possessions possess you.
6. Don’t worry about your problems.
7. Don’t cling to the past.
8. Look up to people when you can, down to no one.
9. Assume your share of responsibility for the world in which you wish to live.
10. Pray consistently and confidently.
Quotations:
"Success ... seems to be connected with action. Successful men keep moving. They make mistakes, but they don't quit."
"Success is never final; failure is never fatal."
"In the circle of successful living, prayer is the hub that holds the wheel together. Without our contact with God, we are nothing. With it, we are 'a little lower than the angels, crowned with glory and honor."
"Enthusiasm is a vital element in individual success."
Personality
Hilton maintained an energetic schedule of working six days a week. He would leave work at 6 p.m. and dance as late as 3 in the morning. He was the subject of many articles and a handful of biographies in the 1940s and 1950s. His autobiography, Be My Guest, published in 1957, was placed in every Hilton hotel room, right next to the Gideon Bible.
Hilton's reputation for eccentricity was reinforced when he bought a 61-room, 35,000-square-foot home in Bel Air, California in 1950. Named Casa Encantada (House of Enchantment), the house was set on nine acres, had a swimming pool, five kitchens, and was maintained by 19 servants who catered to Hilton's every need.
Interests
poker, bridge
Writers
Optimism by Helen Keller
Sport & Clubs
tennis
Connections
Hilton married three times. His first wife was Mary Barron; they had three sons. The eldest son, Conrad Jr., better known as Nicky, became Elizabeth Taylor's first husband. Conrad and Mary Hilton divorced in 1934, a difficult move for the devout Catholic couple. In April 1942 he married the actress Zsa Zsa Gabor; they had one child. They separated in late 1944 and divorced soon after. In May 1977, Hilton married Mary Frances Kelly.
Father:
August Hilton
Mother:
Mary (Laufersweller) Hilton
Spouse:
Mary Frances (Kelly) Hilton
Conrad and Mary's marriage lasted until his death in 1979.
Spouse:
Mary Adelaide (Barron) Hilton
In 1934, when trouble broke out between the couple, Hilton granted Mary a divorce going against his will and teachings of the Roman Catholic Church, though they remained friends. He raised Nicky and Barron, and she remarried and raised Eric, though all three boys eventually worked in his hotels.
ex-spouse:
Zsa Zsa Gabor
For four years, Conrad was married to Zsa Zsa Gabor, a Hungarian beauty who was twenty-five years old when she married the fifty-four-year-old Hilton. This was not a happy affair and ended in flames. Among other things, at that time the Catholic Church did not recognize divorce, so Conrad’s first marriage had “never ended” and he was banned from taking Communion once he married Zsa Zsa. This tortured Conrad until he divorced her.
Conrad later stated that had he waited another hour to propose to her, he wouldn't have.
Brother:
Carl H. Hilton
Brother:
August Harold Hilton Jr.
Brother:
Julian Hilton
Sister:
Eva C. Hilton
Sister:
Felice A. (Hilton) Brown
Sister:
Rosemary J. Hilton
Sister:
Helen A. Hilton
Daughter:
Francesca Hilton
Francesca's paternity was frequently questioned during her lifetime, but no known DNA test was ever administered to prove or disprove Conrad's paternity and she was ultimately considered one of his children.
Son:
Conrad Nicholson Hilton
Son:
Eric Michael Hilton
Son:
William Barron Hilton
Conrad Hilton gave up active management of the company in 1966 when his son Barron was named president. Under Barron Hilton and his successors, the company has gone on to great success based on his father’s foundations.
