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Hilton Hotels Corp Accelerates Expansion Plans For Turkey

Unveiling the country's biggest international development pipeline

Friday, October 31, 2008
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Hilton Worldwide
Hilton Worldwide
Hospitality

Hilton Hotels Corporation (HHC) has revealed that Turkey is its most successful international development market and now boasts the largest pipeline of any global hotel group. Over the next two years the company is set to more than double its Turkish estate, following the signing of 11 new hotel contracts in 10 months.

At a development event in Istanbul today, Patrick Fitzgibbon, Senior Vice President Development, Europe & Africa, Hilton Hotels Corporation outlined HHC’s future plans for the Turkish market and revealed that he anticipates the company will introduce more than 40 hotels from the Hilton Family portfolio across the country over the next five years.

Fitzgibbon explained: “Turkey has always been a special market for Hilton. Having had a presence in the country for over half a century, we are seeing increased demand for quality accommodation throughout the country - not just Istanbul - and are keen to capture a significant part of that!”

“The country welcomes some 27 million international visitors annually, yet there are few international brands catering to these travellers, particularly in the country’s regional centres. Combine this with an extremely buoyant domestic market and it opens up huge potential for the expansion of our Family of Hotel brands. However, our agreements with Turkish property partners mean that we are well positioned to exploit opportunities in this exciting and dynamic market,” added Fitzgibbon.

Under separate non-exclusive Strategic Development Agreements (SDAs) with two leading Turkish property partners, HHC is set to introduce 40 properties (comprising 5,500 rooms) from the Hilton Family of Hotels over the next five years.

“We have made no secret of our ambitions to expand rapidly in Turkey and have formed strategic alliances with partners such as Amplio and Kosifler to enable us to accelerate our expansion plans and make a significant impact on the Turkish hotel market in a relatively short space of time,” added Fitzgibbon.

Last December, HHC inked an SDA with Amplio to develop up to 15 hotels, and has signed management contracts for six Hilton Garden Inn properties so far. In addition to this, under a second SDA announced in June this year, HHC expects to develop 25 new properties with the Kosifler Group, and has already signed deals for a further four Hilton Garden Inn hotels.

Mike Collini, Hilton Hotels Corporation VP of Development for Northern Europe (including Turkey) believes that Turkey’s real attraction lies in the low penetration of international hotel brands in many regional cities across the country, as well as a relatively restricted choice of quality accommodation, particularly in the mid-market sector.

Collini explained: “Quality hotel supply is still incredibly low and not growing at sufficient levels to meet international and domestic demand, so we see a very real opportunity for us to introduce our extensive Hilton Family of hotels in Turkey. As one of the world’s leading mid market brands, Hilton Garden Inn provides us with a perfect vehicle to grow volume in these key city and regional locations very quickly.”

These deals will see the debut and rapid growth of the Hilton Garden Inn - the award-winning mid-priced brand that is part of the Hilton Family of Hotels - across the country, offering 10 properties in diverse locations including Istanbul, Sanliurfa and Bursa. The brand will launch in mid 2010 with the opening of the first two properties in the cities of Kutahya and Diyarbakir respectively.

This move also reflects the dynamic expansion of the Hilton Garden Inn brand across Europe, with six properties currently open with locations in the United Kingdom (Luton North), Germany (Stuttgart NeckarPark), Italy (Rome Airport, Florence Novoli and Matera) and Russia (Perm) as well as 19 hotels in the pipeline to open in Poland, Italy, Germany and Turkey over the next two years.

The company has earmarked Turkey - along with Germany, Russia, the UK, the Iberian Peninsula and Italy - as a key market for extensive development and growth through the introduction of the Hilton Family of hotels. The introduction of Hilton Garden Inn in Turkey, very much underscores HHC’s strategy to rollout its portfolio of hotel brands throughout key strategic markets, which given the relative absence of international branded properties in the local Turkish market, offers significant potential for growth.

As part of this strategy to grow the Hilton Family offering, Hilton has also entered into a franchise agreement with Gocay Tourism, Management, Investment, Transportation & Trade Inc. to open a new Hilton Worldwide Resort in Dalaman, on the south west coast of Turkey. Scheduled to open mid 2009, Hilton Dalaman Golf Resort & Spa will be the company’s first resort property to debut in the country. HHC also foresees further growth potential in this sector and is actively looking to secure other ‘high end’ opportunities to grow its resorts portfolio further.

To service the expected growth in this strategic market, Hilton operates a development office in Ankara and has appointed Pogda Demircan as Development Manager for Turkey.

Hilton has a long and established history in Turkey, opening its first hotel, Hilton Istanbul, in 1955. The company currently operates eight properties - seven Hilton hotels and one Conrad hotel - across six locations (Adana, Ankara, Istanbul, Izmir, Kayseri, Mersin)

Turkey hotel contracts signed to date:
Hilton Dalaman Golf Resort & Spa - Scheduled to open Q2 09 Gocay Franchise Agreement
HGI Diyarbakir - Scheduled to open Q2 10 Amplio Management Agreement
HGI Manisa - Scheduled to open Q2 10 Amplio Management Agreement
HGI Bursa - Scheduled to open Q2 10 Amplio Management Agreement
HGI Kutahya - Scheduled to open Q2 10 Kosifler Management Agreement
HGI Mardin - Scheduled to open Q4 10 Kosifler Management Agreement
HGI Sanliurfa - Scheduled to open Q4 10 Kosifler Management Agreement
HGI Istanbul Bostanci - Scheduled to open Q4 10 Kosifler Management Agreement
HGI Istanbul Golden Horn - Scheduled to open Q4 11 Amplio Management Agreement
HGI Corlu - Scheduled to open Q2 11 Amplio Management Agreement
HGI Corum - Scheduled to open Q2 11 Amplio Management Agreement

About Hilton Hotels Corporation
Hilton Hotels Corporation is the leading global hospitality company, with more than 3,000 hotels and 500,000 rooms in more than 74 countries and territories, including 135,000 team members worldwide. The company owns, manages or franchises a hotel portfolio of some of the best known and highly regarded brands, including Hilton®, Conrad® Hotels & Resorts, Doubletree®, Embassy Suites Hotels®, Hampton Inn®, Hampton Inn & Suites®, Hilton Garden Inn®, Hilton Grand Vacations™, Homewood Suites by Hilton® and The Waldorf=Astoria Collection™.

The Hilton Family of Hotels adheres to founder Conrad Hilton’s philosophy that, “It has been, and continues to be, our responsibility to fill the earth with the light and warmth of hospitality.” The company put a name to its unique brand of service that has made it the best known and most highly regarded hotel company: be hospitable®. The philosophy is shared by all nine brands in the Hilton Family of Hotels, and is the inspiration for its overarching message of kindness and generosity.

For more information about our company, please visit www.hiltonworldwide.com, and to learn more about our be hospitable philosophy, please visit www.behospitable.com.
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