What will the Hiltons say?

A reader says: Paris Hilton is in Manila, doing another hotel endorsement, not the Hilton. How can the Hiltons allow her to endorse a property that is not theirs? Aside from the scandals, Paris has sibling rivalry with her sister. What will her grandfather, who founded Hilton Hotels, say? The grandfather had a rags-to-riches story, but Paris was born with a silver spoon. How can Paris continue the legacy? No wonder family businesses die after the third generation.

My answer

The Hilton family business was so successful that at one point, Hilton hotels were the most famous in the world.

But several of your allegations are incorrect.

I am not sure if Paris is rivals with her sister. The rivalry Paris supposedly had was with her ex-best friend, the actress Nicole Richie (daughter of singer Lionel Richie), with whom she starred in the reality TV series “The Simple Life.”

Paris visited Manila to endorse not a competitor of the Hilton, but a condominium project by a local company.

I do not see any harm in her doing so, especially since Paris does not seem to be connected to the management of Hilton Hotels and Resorts, which oversees the 500-plus hotels in 75-plus countries.

Paris is indeed a descendant of Conrad Nicholson Hilton, the founder of Hilton Hotels, but she is not a Hilton heiress.

Born entrepreneur

Conrad Hilton is not Paris’ grandfather; he was her great-grandfather. Born in New Mexico on Christmas Day in 1887, Conrad was a natural entrepreneur.

He worked in his father’s store when he was a child. He later decided to become a banker.

Conrad’s story is inspiring, and as you say, classic rags to riches. In 1919, Conrad went to Texas intending to buy a bank, but bought the Mobley Hotel in Cisco instead. Mobley became the first Hilton Hotel. Conrad bought several hotels in quick succession, and it was only the Great Depression that stopped him—temporarily. Conrad almost became bankrupt in the 1930s, but soon regained control of his growing chain.

After buying the famed Waldorf-Astoria in New York, Conrad decided to form the company Hilton Hotels in 1946 (for the Hilton hotels in the US) and two years after, the Hilton International (for the hotels outside the US). Hilton became the first international hotel group.

In 1966, his second child, Barron Hilton, became president of Hilton Hotels, and his first child, Conrad Nicholson “Nicky” Jr., became president of Hilton Worldwide.

In 1979, upon Conrad’s death, he bestowed the bulk of his wealth to the Conrad Hilton Foundation, leaving only small amounts to family.

Barron was CEO-President and board chair, but he fought his father’s will. Barron eventually received a substantial number of the shares, divided among him, the company, and his (Barron’s) foundation.

In 2007, Barron announced that upon his death, more than 95 percent of his estate will go to his foundation, likely to be merged with that of his father.

Black sheep

As for Conrad’s eldest, Nicky, here is where the story gets depressing.

Nicky the black sheep reportedly had an affair with Zsa Zsa Gabor (Conrad’s second wife and Nicky’s stepmother); then married the film star Elizabeth Taylor (their marriage lasted less than a year). He then married a socialite, but he died of a heart attack at age 43, after years of heavy drinking.

My friend, the businessman Robin Tong, lent me his book “House of Hilton,” written by US journalist Jerry Oppenheimer, which says the real cause of Nicky’s death was because his brother Barron convinced their father to sell off Hilton International in 1964. The sale broke Nicky’s heart.

If true, then this would be sibling rivalry taken to the extreme. (The US-based Hilton Hotels bought the foreign-based Hilton Group in 2006, reuniting all the hotels under the same brand once more.)

Barron by all accounts was an excellent successor to his father, expanding the Hilton empire and doing lots of innovations. His third son Steven currently heads the Hilton Foundation. The hotel chain is mostly now managed by professionals.

Barron has eight children: the sixth child, Richard, married socialite Kathleen Richards, and they have four kids: Paris, Nicky, Barron, Conrad IV.   Richard does not seem to play a significant role in the management of Hilton Hotels, so unless circumstances change, Paris will not be a keeper of the Hilton legacy either.

Next week: More letters from readers

Queena N. Lee-Chua is on the Board of Directors of Ateneo de Manila University’s Family Business Development Center. Get her book “Successful Family Businesses” at the University Press (email [email protected].) Email the author at [email protected].