During his lifetime, Conrad Hilton went from the son of an immigrant, to respected WWI officer and veteran, to being both well-respected and feared within his industry, earning him the nickname “Hotel King” for his hotel empire!
As the progenitor of the Hilton family that still owns a portion of Hilton Worldwide – the company Conrad founded in 1919 – Conrad is the great-grandfather of model and celebrity, Paris Hilton, as well as businesswoman, Nicky Hilton, who married into the Rothschild family.
Early Life
Conrad Nicholson Hilton was born on December 25 1887 as the second eldest of eight children to Norwegian immigrant, Augustus Halvorsen Hilton, and his wife, Genevieve Laufersweiler, an American woman of German ancestry.
Born and raised in the small mining town of San Antonio, then in the New Mexico Territory, Augustus Hilton would own a grocery store that had also partially been converted into a 10-room hotel above the store.
Whilst it didn’t make much, it allowed Augustus to provide for his family, if only barely.
To help put food on the table, a young Conrad would be put to work in his father’s store/hotel after school and on weekends. Beyond helping to put food on the table, a young Conrad would also learn many skills that would help him later on in life.
Although the concept of Conrad being put to work at such a young age may seem strange today, it was quite common during the time (with future oil tycoon, Armand Hammer, and sports mogul, Malcolm Glazer, also doing this!)
Eventually having enough money, Augustus would send Conrad to the Goss Military Academy (now the New Mexico Military Institute) and later St Michael’s College (now Santa Fe University of Art and Design).
Upon graduating, Conrad would attend and graduate the New Mexico School of Mines (now New Mexico Tech).
Pre-Hotel Years
On January 6 1912, Congress would formally admit New Mexico as the 47th state in the union.
As a new state, New Mexico was required to send senators and representatives to Washington, whilst also needing to establish its own state legislature, including a Senate and House of Representatives.
Seeing this, a 25 year old Conrad Hilton would run for, and be elected to, the New Mexico House of Representatives for the Republican Party, serving in the state’s first legislature from 1912 until 1916.
Despite being one of the most well-respected men in the house at the time, politics didn’t really interest Conrad Hilton, eventually leading him not to run for re-election during the 1916 election.
Instead, Conrad hoped to go into business for himself. However, the US would join WWI in 1917, resulting in Conrad joining the US Army as an officer, and serving on the Western Front (mostly France) during the war.
With the war’s end in 1918, Conrad would stay in France until 1919, where he’d be discharged from the army and return to San Antonio. Sadly, Conrad’s father had died in a car crash in 1918, making Conrad the man of the house.
Taking charge, Conrad would raise $5,000 (roughly $78,000 adjusted for inflation) before moving to Wichita to buy a bank. However, Conrad would not be able to convince anyone to sell their bank to him.
Deciding Kansas wasn’t for him, he’d moved his family to Cisco, Texas, as the state was experiencing an oil boom which was attracting not only prospective oil entrepreneurs, but also wealthy tourists too.
Still hell bent on buying a bank, Conrad would soon enter negotiations to buy a bank in the town. Talks progressed so far that Conrad and the owner would agree on a price and would sit down to sign the contract transferring ownership to Hilton.
However, Conrad would notice something. Right at the last second, the owner to raise the price. In Conrad’s mind, the owner was trying to con him…
His First Hotel
Understandably annoyed, Conrad would walk out of the meeting, ending months of negotiation out of sheer anger that the hotel owner had done that. He didn’t oppose paying more for the bank, he opposed how it had been done.
Having walked out of the meeting, Conrad would head to the nearby Mobley Hotel. Walking into the lobby, he would find a queue of people waiting to be given a room – even when other hotels in the area had plenty of spare rooms.
Immediately, Conrad knew that the hotel business had been his true calling all along. Within a few days, Conrad had not only entered talks with the owner, but had actually bought the hotel for only $35,000 ($550,000 adjusted for inflation)!
Taking possession of the hotel, Conrad would take what he’d learned at his father’s hotel years prior and apply it at the Mobley.
For example, the abundance of cheap, yet high quality restaurants in the surrounding area saw most people staying at the hotel avoid the hotel restaurant in favor of these cheaper (and better) restaurants.
Knowing the restaurant only made a small fraction of the hotel’s total revenue, and that the space would be more profitable if it were hotel rooms, Conrad Hilton soon hired contractors to turn the hotel restaurant into extra rooms.
Beyond that, Hilton would add a newsstand and general store (selling things like toothbrushes, razors, deodorants etc.)
This didn’t just make the hotel more revenue, but also attracted more customers to the hotel, as it was seen as an all-in-one shop (minus the restaurant of course).
Expanding
Within a year of acquiring the Mobley Hotel, Conrad Hilton had made his money back and then some. This bold success encouraged Conrad to expand his hotel business further.
To that end, Conrad would acquire the profitable, yet struggling Melba Hotel in Fort Worth and the Waldorf in Dallas. Here, he’d do to them what he did with the Mobley Hotel, soon having three highly profitable hotels in Texas.
Building on this, Conrad would go on to build his first hotel – the Dallas Hilton – in 1925. Beyond being the largest hotel he owned, the Dallas Hilton would also be the first hotel to bear the now-famous “Hilton” name.
It would also be here, where Conrad would decide that no two hotels should look the same. In other words, they shouldn’t look the exact same no matter what city you’re in (like McDonald’s restaurants do).
With the Dallas Hilton similarly proving to be quite successful, Conrad would expand to cities like Abilene, Waco and El Paso, doing so in 1927, 1928 and 1930 respectively, giving Conrad a sizable empire across Texas.
At this time, Conrad Hilton had six hotels of varying sizes and was famous throughout the Texas hotel industry from being the ultimate success story – going from an unknown hotel owner in Texas, to hotel magnate in only 11 years.
Great Depression
Only a few months after announcing that he’d be building a hotel in El Paso (later the Hilton El Paso), the stock market would crash, setting off what we now call the Great Depression.
Whilst Hilton El Paso would open in 1930, the Great Depression nearly bankrupted Conrad Hilton.
At one point, Conrad had nearly $500,000 in debt (roughly $8 million in today’s money) and no way of paying it back as people were being laid off left, right and center and no one was traveling or booking hotels, not for business or for pleasure.
To pay off his debts, Conrad would be forced to sell off some of his hotels, something he later described as one of the most painful things he ever did.
Despite this, Conrad would be able to continue construction of the Hilton El Paso, which was eventually completed in 1930. For much of the rest of the Depression, Conrad would live in one of the penthouse suites with his mother.
As if almost losing his business wasn’t enough, Mary Barron (who’d married him in 1925) would file for divorce in 1934, owing to his shaky financial situation at the time. This would be a proverbial kick in the teeth for Conrad Hilton.
Whilst the initial Depression years (1929-1935) would be brutal, the economy would eventually begin to recover somewhat, with Conrad’s first priority being to reacquire the hotels he’d lost control of during the Great Depression.
By 1937, Conrad had reacquired his pre-Depression empire through a number of oil leases (bought for cheap by Hilton due to the Depression) and was ready to rebuild.
Rebuilding an Empire
Whilst the world (nor the US) wasn’t fully out of the Great Depression yet – that wouldn’t happen until the end of WWII – jobs started to become more abundant, and people began to travel more, both for business and for pleasure.
And Conrad Hilton had placed himself in the perfect position to capitalize on it all…
Having at least one hotel in all of Texas’ major cities, as well as being flush with cash, Conrad chose to expand out of Texas and into California.
To that end, he’d buy the Sir Francis Drake Hotel in San Francisco (which had cost $4 million to build at the time) for $275,000 in late 1938. Conrad would own the Sir Francis Drake until December 8 1941, to raise capital for further expansion.
Continuing to expand, Conrad Hilton would travel to the capital of his home state of New Mexico, Albuquerque, to open the Hotel Andaluz in June 1939, becoming the first Hilton-branded hotel outside of Texas (branded as the “Hilton Hotel” when it opened).
WWII would seriously hamper Conrad’s business. Nonetheless, he would persist with his business booming near the end of the war.
Using this extra money, Conrad would expand into the northern United States in February 1945, purchasing the Stevens Hotel in Chicago, then the world’s largest hotel.
Taking possession of the hotel, the hotel would be renamed the Conrad Hilton Hotel, in honor of the man who’d just acquired it.
Acquiring the Stevens Hotel was a major prestige boost for Hilton, as it took him from a hotelier with a small empire in the southern US, to a hotelier with a relatively large empire, including several landmarks!
Conrad would use the contacts he’d acquired from his previous hotels to attract even more celebrities to the newly renamed Conrad Hilton Hotel. And guess what? Hilton still own the Chicago Hilton (renamed after a renovation in the 1970’s).
At the same time he acquired the Stevens Hotel, Conrad would also acquire the Palmer House hotel for $20 million. Hilton would own and operate the hotel until selling it in 2005.
Becoming Incorporated
Now having a bona fide empire, spanning four states, numerous hotels and hundreds of thousands of clients per year, Hilton decided to incorporate Hilton Hotels Corporation in 1946. Two years later, in 1948, Hilton would incorporate Hilton International Company.
Months after incorporating, Hilton acquired the Mayflower Hotel for $2.6 million in 1946.
After a protracted legal battle with investors, Hilton would eventually come to own what many called the “Hotel of Presidents” due to the number of presidents who stayed there under Hilton’s ownership.
In 1947, Conrad listed Hilton Hotels on the stock market, becoming the first hotel chain ever listed on the New York Stock Exchange (NYSE). As founder, Conrad remained as the largest shareholder in Hilton Hotels.
On October 12 1949, Conrad Hilton would personally travel to New York to acquire the management rights to the famed Waldorf Astoria – a hotel he’d dreamed of owning since he nearly went bankrupt in the early 1930’s.
Hilton Hotels would only buy the hotel outright in 1972, a mere seven years before Conrad’s death.
In 1942, Conrad Hilton would move the corporate headquarters of Hilton Hotels from Texas to the Bel Air section of Los Angeles. With this, Conrad moved out of the penthouse at the Hilton El Paso and to Bel Air.
With his business doing great, Conrad would purchase the 35,000-square foot home at 10644 Bellagio Road in Bel Air, California in 1950, giving it the name of “Casa Encantada” meaning “Enchanted House” in English.
He’d live there until his death in 1979.
In 1954, Conrad Hilton would lead Hilton Hotels’ first acquisition of another hotel chain, acquiring the The Hotels Statler Company, Inc., which operated the Statler chain of hotels, for $111 million – then a world record for a real estate deal.
Legal Issues And Continued Expansion
Whilst a good deal, acquiring the Statler hotel chain would result in anti-trust litigation being initiated against Hilton Hotels, as they now owned many of the largest hotels in many of the US’s major cities.
To settle the suit, Conrad Hilton was forced to (reluctantly) sell off certain hotels – something Conrad later described as one of the most difficult decisions in his life.
Beginning in 1948, Hilton would begin to expand abroad, purchasing and renovating hotels in foreign countries, thus leading to the aforementioned incorporation of Hilton International Company that same year.
In an attempt to expand into a related, yet distinct field, Conrad Hilton would buy the Carte Blanche credit card company in 1958. Despite making it an integral part of his hotel empire, the company soon went out of business.
Conrad would also make several other non-hotel related investments, particularly investing in the American Crystal Sugar Company, as well as making several other investments too.
Death
In 1966, at the age of 79, Conrad Hilton would officially step down from the day-to-day operations of the company he founded, naming his second-eldest son, Barron Hilton, as his successor and president of the company.
Despite stepping down from the day-to-day operations of the company, Hilton would continue to sit on the board of directors, overseeing the continued expansion of the company.
On January 3 1979, Conrad Hilton would die of pneumonia at the age of 91 years old, being survived by his company, his third wife, Mary Frances Kelly (who he’d married in 1976), and his four children.
At the time of his death, Forbes estimated his net worth at $1 billion, or roughly $3.71 billion when adjusted for inflation.
Given that his net worth was derived almost entirely from his stake in Hilton Hotels Corporation, which is still listed on the stock market, his net worth would be more in the region of $30 billion at Hilton’s current share price.
At the time of his death, Hilton Hotels chain had 185 hotels in the US, as well as 75 hotels in foreign countries, mostly in Europe, Canada and Oceania.
Legacy
During his life, Conrad Hilton was one of the most respected businessmen in the world. Yet, his reputation would sour considerably after his death…
Following his divorce from Mary Barron in 1934, Conrad would marry Hungarian-American actress Zsa Zsa Gabor in 1942. The couple would have one child, a daughter called Francesca, in 1947 before divorcing that same year.
In her 1991 biography, Gabor would reveal that Francesca would only be conceived after Conrad raped her, thus souring Conrad’s mighty reputation considerably, going from hotel’s golden boy to well, a stain on the industry.
That aside, upon Conrad’s death in 1979, he’d leave the bulk of his estate – 13 million shares, or 97% of his company – to his charitable foundation.
Conrad’s son and heir, Barron Hilton, would contest this in court as a clause allowed him to purchase the shares to maintain family control of the Hilton Hotels Corporation.
Unhappy at Barron’s attempt to execute this clause, Barron Hilton and the Conrad N. Hilton Foundation would spend years debating this in court, before the court ruled in Barron’s favor, thus allowing him to purchase 34% of the shares the foundation owned.
Ultimately, Barron would follow his father’s footsteps and do the same following his own death in 2019.
Despite never openly showing it, both Conrad Hilton and J. Willard Marriott (founder of the Marriott Corporation) would also have a decades-long rivalry with one another, as their hotels often competed with one another.
How Can I Replicate What Conrad Hilton Did?
Having read about the amazing life of Conrad Hilton, you’re probably how you can replicate what he did, perhaps to make your name the next big thing in the hospitality industry.
Whilst we usually tend to say something like “You can’t, Conrad Hilton has already filled that niche so you can’t replicate him and still expect his immense success,” this time, you can!
Not belittling Conrad’s achievements in any way, but you could easily take his life and try your best to replicate it.
For instance, you could start by acquiring a small, yet thriving hotel business. From here, you make it even more profitable before finally expanding it beyond its original location.
Over the next few years/decades, you use your profits (and maybe even some bank finance) to acquire and build more hotels, soon giving you multiple locations across your state/country.
Consolidating your business, you can then expand nationally (assuming you haven’t already) before eventually expanding internationally!
Alternatively, you could take Conrad Hilton’s story a little less seriously, using it instead as a template perhaps to create something to rival Airbnb – maybe the luxury version to contend with the Hilton-owned Waldorf Astoria?
What Can we Learn From Conrad Hilton?
Despite having been dead for over 40 years, the life of Conrad Hilton can still teach you a surprising amount for the modern day, not just about starting your own business, but also just about life in general!
Stick to Your Beliefs
Growing up, Conrad lived in a very religious household. Both his mother and his father were devout Christians (Roman Catholics to be precise) and raised their eight children that way too.
Conrad’s mother would even go as far to tell a young Conrad that prayer was the best investment he’d ever make.
Whilst to some this may seem odd, a young Conrad took this to heart being one of the things he’d carry on throughout his life.
According to Conrad, it would be prayer that would get him through both the best and worst times in his life – from building his empire, to seeing it crumble during the Great Depression, to seeing it rise out of the flames.
It would’ve been easy for Conrad to have seen his business crumble and lose faith, not only in his business skill but also his God. Yet, he didn’t. His faith in God allowed him to keep on going, eventually allowing him to establish his hotel empire.
And it was due to his faith in God, that Conrad was able to keep faith when everyone else was losing their shirt. This in turn helped him expand his business and become the so-called “Hotel King”.
In the sense of the modern-day, you could still turn to religion for this (if you so choose). Or you could turn to something else, be it music, sports, or some other hobby that helps you keep faith in yourself.
Don’t Forget to Give Back
As one of the richest men in the world at the time, Conrad Hilton could’ve quite easily sat in his ivory tower (or indeed, in the penthouse suite of one of his many hotels), counting his gold coins like Scrooge McDuck.
However, he didn’t.
Instead, he wanted to use his money to alleviate human suffering worldwide through the establishment of the Conrad N. Hilton Foundation in 1944, which currently has an endowment of a little more than $5 billion.
Beyond that, Conrad was also a patron of education, having donated $1.5 million to the University of Houston to establish a hospitality school, known as the Hilton College of Hotel and Restaurant Management, which opened in 1975.
On top of that, Conrad would also donate a library – the Conrad N. Hilton Library – at the Hyde Park campus of the Culinary Institute of America.
Always be Humble
Despite his billion dollar fortune, Conrad Hilton never forgot his origins. Over the course of his life, even when his fortune could’ve easily led him to be quite self-absorbed, Conrad always remembered to be humble.
As with many hotel magnates, Conrad made a conscious effort to visit the hotels he owned. However, he wouldn’t tell these hotels in advance, instead just showing up one day out of the blue.
Dressed in a business suit, Conrad looked like many of the people who frequented his hotels to the staff. Here, he’d begin talking to them about their jobs, personal life and so on. Before dropping his name.
Even after this, when many of his employees would go out of their way to try and help him, Conrad would refuse, insisting that he had to do it himself, saying that if they can do it, so can he as their boss.
Not surprisingly, many of the Hilton employees who met him were not only inspired by him, but genuinely loved him too, in a way that no other CEO has, or will ever be…
Pass on What You Have Learned
A common theme among people with incredible rags-to-riches stories (which we often cover on our surprising wealth stories segment) is that they tend to pass on what they have learned to the next generation.
However, this is usually to their own children, thus allowing their children to continue what they started.
Whilst Conrad undoubtedly did that (given the fact that his sons took over and grew the business even further after their father’s death in 1979), Conrad also taught people that weren’t his own family about how to succeed in business.
You see, in 1958, Conrad published his autobiography, detailing much of the routines that allowed him to become so successful in the first place, not to mention going into excruciating detail about his nearly 40 years of experience in the hospitality industry.
Despite being over 60 years old, the book remains surprisingly relevant, being as one hotel owner I know put it “The Hotelier’s Bible” maybe she was exaggerating, but still, it shows how much modern hoteliers revere his book.
And guess what? You can still buy it today!
Don’t Let A Setback Stop You
When Conrad first decided he wanted to go into business for himself, he decided he wanted to be a banker. Realizing it would be easier to acquire a pre-existing bank, Conrad would soon enter talks to buy one.
Despite talks progressing considerably, the purchase would eventually fall through. Despite this being a major setback in his plans, Conrad wouldn’t let this stop him.
Instead of purchasing a bank like he’d hoped, Conrad would buy his first hotel instead, laying the groundwork for what would become Hilton Worldwide – the company his family still owns to this day!
And the collapse of the bank deal would prove to be the best thing that happened to Conrad, something he would acknowledge years later.
You see, whilst he may have become an even wealthier and more successful had he found and bought another, there’s no guarantee that would’ve happened. Instead, he was able to use his money to become the “Hotel King”.
Has the life of Conrad Hilton inspired you? Tell me in the comments!
