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The expansion drive follows the reunification of the Hilton brands under one company earlier this year when Hilton in America bought out its UK counterpart, Hilton Group.
When the two were separate, the US business was not allowed to go outside North America with its other brands, including Doubletree, Hilton Garden Inns and Hampton Inns. These will now spearhead the global expansion.
Ian Carter, chief executive of Hilton International, said: “It’s very important for us to reach critical mass in countries where we are under-represented, such as France, Germany, eastern Europe, China, India and Australia.”
Britain will also be part of the growth. Carter expects to expand the number of the group’s UK hotels from 70 to 140 within five to seven years.
He is touring the world to decide which brands to roll out in which countries.
While Doubletree is an upmarket brand, Hilton Garden Inns is comparable to the mainstream Holiday Inns, and Hampton Inns is closer to the lower-priced Holiday Inns Express. Although they will carry the Hilton name, they will be more basic than the flagship chain, and have more mass- market appeal.
The 1,200 new properties will be mainly owned by outside investors and run under management contracts by Hilton. But gradually more will be franchised to third parties to own and run, until the additional hotels reflect the present mix of 65% franchised, 30% under contract and 5% directly owned by Hilton.
Carter refused to put a figure on the cost of his ambitious plans. He said: “We have committed significant human resources to this expansion, which is the most important element if you are looking to expand by franchise and management contract.”
Carter expects to sell the Metropole hotels in Birmingham and London in September for more than £400m.
He was speaking at the official opening of the 283-room Canary Wharf Hilton in east London, which is being run under contract.
Carter said: “We actually did better than expected in the fourth quarter, and we started this year in great shape, with the bulk of our big London hotels full in July and August.”
But higher costs meant that sales were not enough “to get us back to the Ebitda [earnings before interest, tax, depreciation and amortisation] we made pre-9/11”.
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