Hotel News Now discourages its columnists from being “personal” in our submissions. A good policy. But when you’ve had a once-in-a-lifetime opportunity to work side-by-side for 11 wild years with an industry visionary—one that just left us, and much too soon—well, the kind editors at HNN bent the rules a bit for this columnist.
Jeff Higley’s recent column, “Steve Bollenbach’s legacy lives in today’s hotel deals,” was a wonderful and appropriate summary of how the transactions Steve conceived and completed not only transformed Hilton Hotels Corporation, but altered the landscape of the lodging business.
The numbers speak for themselves. During Steve Bollenbach’s tenure as CEO, Hilton went from a hotel-gaming company with 250 hotels (10 of which accounted for the bulk of our lodging earnings before interest, taxes, depreciation and amoritization) and 10 hotel-casinos (two of which made up the lion’s share of our gaming EBITDA) almost exclusively in the United States to a global, pure-play hotel company with more than 2,000 properties in 70 countries. The company’s market capitalization jumped from $2 billion to $12 billion. And along the way, billions of dollars of value was created for shareholders and owners, and new opportunities were generated for customers, employees and franchisees.
Steve died 8 October at the too-young age of 74.
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Steve Bollenbach |
Over the years, we had stayed in close touch, often reminiscing and laughing about the ride we took together. I had already been with Hilton for four years as SVP of Corporate Affairs when Steve arrived from The Walt Disney Company in February 1996. From that point, until we sold the company to Blackstone in 2007, I was fortunate to have a front-row seat to a great show. While the numbers, to be sure, speak volumes, there was so much more to Steve’s leadership of our company.
In early 1996, Hilton was a company with a renowned brand and some really good properties, but not much in the way of a strategic vision for how it would grow and tackle new challenges that inevitably arise in our industry. That changed right away.
During his first week, Steve gathered his senior managers and said he was going to outline four “value drivers.” My ears perked up, and I took out my yellow legal pad. Driver 1 would be to emerge as the winner in the consolidation of the gaming business; 2, acquire full-service hotels at less than replacement cost; 3, leverage the power of the Hilton brand name, and 4, take advantage of the current favorable capital markets.
Finally, I thought, here’s the foundation not only for a corporate strategy but a viable story we could relate to Wall Street, the news media and all our various constituents. Going forward, when we would get the question, “How are you guys going to grow?” we would have an answer. This was an important development.
Steve was always laser-focused on creating shareholder value, and as the person charged with the company’s investor-relations activities, I knew how imperative it was to have a clearly defined growth strategy to communicate to analysts and investors. After all, what do shareholders ultimately invest in but an achievable strategy and confidence in management’s ability to execute it?
And to help ensure we could execute, Steve brought in new finance and development people, including such talented and experienced executives as Matt Hart, who became our chief financial officer.
Within the first year, Steve had checked all the boxes on the four “value drivers,” setting the stage for the future transactions Jeff discussed in his column. Steve had me in every meeting with bankers, lawyers and investors— enabling me to be involved in every detail of every deal, and thus maximizing my ability to tell our story.
But Steve’s impact on our company went beyond the financials and transactions. In our industry’s darkest hour, the aftermath of the 9/11 terror attacks in New York City and Washington, D.C., he was a steadying presence for our employees, customers and shareholders.
He calmly thought about what the subsequent several months would bring (we could maintain some decent level of occupancy but at the expense of rate, with things returning to relative normalcy in eight months or so). Steve determined that rather than instituting mass layoffs, we would reduce hours at our hotels in order to keep people working. As soon as planes were allowed to fly into New York, he and I met personally with all of our area employees. His low-key, “let’s-think-this-through” manner was a source of comfort to our employees and put us in a good position when the turnaround finally arrived.
One of Steve’s passions was education, and he put his money where his mouth was. He created a program—using his own money—whereby Hilton employees and their dependents could apply for funds to assist with college tuition. I served on the selection committee. Steve did, too, and along with the other committee members, he reviewed applications and identified people he could help. Hundreds of employees and/or dependents were able to pay some or all of their college expenses, thanks to Steve’s generosity.
In typical fashion, Steve kept such activities on a low burner. His philanthropy was done quietly; he was not one to seek the limelight. He disliked making speeches and doing media interviews (especially TV), and I talked myself hoarse on more than one occasion convincing him to do important ones. “Only if it helps the company,” he would say. That was the deal we struck early on.
Steve Bollenbach was a financial mastermind and industry visionary. He was my boss and a mentor. But most important, he was my friend.
Marc Grossman is a senior communications executive who served as senior VP, corporate affairs, for Hilton Hotels Corporation, where he was responsible for all global corporate communications, investor/financial relations, public affairs, brand/marketing public relations, crisis communications and internal communications. He also held senior positions with three leading international communications firms. He can be reached at mgrossman6@msn.com.
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