Hilton to Spin Off Real Estate into 70-Property Hotel REIT

MCLEAN, VA — Hilton Worldwide (NYSE: HLT) has announced plans to spin off the majority of its real estate business into a publicly traded REIT. The company also plans a second spinoff, putting its Hilton Grand Vacations timeshare business into a third publicly traded company.

The company hopes the spinoffs will help focus Hilton Worldwide’s model on its core business.

“The transactions we announced today will result in three pure-play companies, enabling dedicated management teams to fully activate their respective businesses,” says Christopher Nassetta, president and CEO of Hilton Worldwide. “We intend to have the appropriate leadership, strategies and capital structures in place to set up all three companies for further success.”

If approved by the Securities and Exchange Commission (SEC), Hilton’s new REIT will include about 70 properties and 35,000 rooms, comprising one of the largest and most geographically diversified publicly traded lodging REITs. The REIT’s portfolio will contain luxury and upper-upscale assets in high-barrier-to-entry urban and convention markets, top resort destinations, select international regions and strategic airport locations.

The new timeshare company will contain nearly 50 club resorts in the United States and Europe. The company will have a long-term license agreement with Hilton Worldwide to market, sell and operate resorts under the Hilton Grand Vacations brand.

Shareholders of HLT stock will receive distributions of the new entities’ stock upon the spinoffs.

Hilton plans to file appropriate registration statements with the SEC during the second quarter of this year. The company expects to complete the transitions by the end of the year.

The spin-off transactions will not require a shareholder vote, according to the company. Deutsche Bank Securities and Goldman, Sachs & Co. are acting as Hilton’s financial advisors.

McLean, Va.-based Hilton Worldwide is a global hospitality company with more than 4,600 managed, franchised, owned and leased hotels and timeshare properties throughout 100 countries and territories. The company’s stock closed at $20.70 on Friday, Feb. 26, down from $27.85 one year ago.

—Neliie Day

Content Partners
‣ Bohler
‣ Lee & Associates
‣ NAI Global
‣ Walker & Dunlop

Subscribe to the newsletter

Webinars on Demand

Read the Digital Editions

Northeast Multifamily & Affordable Housing Business

Midwest Multifamily & Affordable Housing Business

Western Multifamily & Affordable Housing Business

Texas Multifamily & Affordable Housing Business

Southeast Multifamily & Affordable Housing Business

Heartland Real Estate Business

Northeast Real Estate Business

Southeast Real Estate Business

Texas Real Estate Business

Western Real Estate Business

Shopping Center Business

California Centers

Student Housing Business

Seniors Housing Business

Featured Properties