Famous Hotel Business Deals: Case Studies

Are you getting nervous about your first hotel purchase? Daunted by your own expansion plans? Don’t worry – you’re in good company. Over the last century, plenty of people have endured the pressure of buying into – or expanding – their hotel empire.

The size and style of hotel purchase deals might have changed over the years, but the core lessons remain the same: when buying a hotel or hotel chain, be patient, be flexible, and remember that it’s never too late to create a first-rate hotel business.

Hilton Hotels: Conrad Hilton, 1919

In Cisco, Texas in 1919, an ambitious 32-year-old shopkeeper’s son was returning home empty-handed after his deal to buy a small bank had fallen through.

At short notice, he checked into the Mobley Hotel, where temporary workers in the booming Texas oil industry could book a room for eight hours at a time, providing accommodation to match their work shift patterns. Impressed with a business that was capable of taking 3 bookings per day on every room rather than the usual 1, he decided then and there to purchase the hotel.

The acquisition of this 40-room hotel was to be the first of many; Conrad Hilton, the shopkeeper’s son from New Mexico, spent his remaining years building up a lucrative empire, now known as Hilton Worldwide. Hilton Worldwide operate a portfolio of over 642,000 rooms in 91 countries across the globe, and are listed as one of the top 50 private companies in the world by Forbes.


Waldorf Hotel: Charles Forte, 1958

The purchase of a hotel isn’t always the first step in entrepreneurship – sometimes the journey to becoming an hotelier is a long and difficult one, as was the case for Charles Forte.

Charles Forte was just a boy when his family left a declining fortune in Italy behind them to start afresh in Alloa, Scotland. After serving his business apprenticeship in his father’s café businesses, he purchased the lease on his own milk bar (café) in London’s premier Regent Street, just before the outbreak of World War II. In spite of tough market conditions over more than two decades, Charles Forte worked hard, made tough business decisions and eventually managed to build his business into a profitable chain of cafes and restaurants across London.

After more than twenty years in business, Charles Forte purchased his first hotel: the exclusive Waldorf Hotel in Aldwych, London. At 50 years old, you would be forgiven for thinking that this purchase would be the final glorious feather in the cap of this accomplished self-made businessman, but it was just the beginning; with unparalleled conviction and energy, over the following decades Charles Forte built up a multi-billion-pound empire of more than 800 hotels.

By the time he retired, Forte had spent 35 years in the hotels industry, his name becoming synonymous with the British hotels industry. He was knighted in 1970 and later awarded a peerage, becoming Baron Forte of Ripley.

Premier Inn: Whitbread PLC, 2004

In the same month that Maria Sharapova battled Serena Williams to become the first Russian Wimbledon champion, Whitbread PLC were involved in a lengthy auction process that would eventually create one of the UK’s most popular hotel chains.

In late July 2004, after seeing off a number of other interested parties, Whitbread PLC (already market leaders with the Travel Inn brand of budget hotels in 2004) announced the purchase of the Premier Lodge hotel group for a whopping £505 million. At the time, the addition of 132 operational hotels to the Travel Inn portfolio increased the size of the business by almost 50%; by the time the deal had completed, Whitbread’s hotel group held nearly 30,000 hotel rooms in a business that could boast some of the highest occupancy rates in the industry.

Over the past ten years, the business has been renamed, going from “Premier Travel Inn” to the simpler “Premier Inn”, but retains its title of “the UK and Ireland’s biggest and fastest growing hotel company”, with more than 650 Premier Inn locations in the British Isles.


Famous Hotel Business Deals: Case Studies