The operator of the Hilton Hotel in Nairobi’s central business district has revived the property’s conferencing business after last year’s failed bid to sell the property to a new investor.
The hotel has found a new lifeline from leasing out its conference facilities to clients for meetings and has tapped outside caterers, including the Sarova Hotels & Resorts, to support the return to operations.
The revival of Hilton’s conferencing facilities, which sit on the property’s mezzanine floor, has been boosted by sustained demand for meetings, incentives, conferences and exhibitions (Mice) around the central business district.
The nearby Nairobi Sarova Stanley Hotel has, on occasion, leased out space at the Hilton to cover excess bookings made at its own facility.
Floors above the conferencing area have been converted to co-working spaces, while the hotel has expanded its let-out retail space as it doubles down on the lifeline.
“Hilton has been trying to stay afloat, and as such, when they get an enquiry for their space, they lease it out,” a source close to International Hotel (Kenya) Limited, the operator of the property, told the Business Daily.
“They are trying to use as much space as they can.”
The State’s planned sale of its shareholding in the iconic Hilton Hotel and InterContinental hotels flopped last year after failing to get a buyer to match the reserve price set by the government.
The 287-room hotel closed its doors indefinitely on December 31, 2022, signalling what was at the time the end of an era for the business, which had operated since 1969.
The government held its value in the hotel operator unchanged at Sh850.6 million in the financial year ended June 2023, represented by 1.7 million shares or a 40.58 percent stake.
The New York Stock Exchange (NYSE) listed Hilton International Limited holds a majority 59.42 percent stake in the hotel.
The Business Daily could not immediately establish whether the entity had sold its stake in the business, having put it on sale at the same time as the government in April 2024.
The Privatisation Authority says it is yet to restart the sales process after lower bids led to the deal’s suspension.
“We sent out requests for quotes to sell the government’s shareholding in the hotel, but the bids were not successful. We are yet to restart that process,” said Dr Janerose Omondi, the acting Managing Director at the Privatisation Authority.
A source not authorised to speak to the media at the Sarova Group told the Business Daily that Nairobi Stanley has a verbal agreement to support the Hilton property with vendor services, including catering.
The Hilton property also serves Nairobi Stanley by holding additional conferences or meetings.
“There is no formal written agreement, so to speak. We have a verbal agreement, including providing vendor services like catering, which are also offered at other locations like Broad Walk mall,” said the source.
“We have many events (at Nairobi Stanley) and sometimes lack enough space.”
The operator of the Hilton Hotel has previously mulled repurposing the hotel for retail shops and student hostels. A proposal to run the hotel as a three-star facility has also been floated in the past.
The landmark property comprises 333,839 square feet of built-up area, comprising 40 basement parking spaces, retail shops on the ground floor and mezzanine level, meeting/banquet facilities, and a 20-storey hotel tower with 287 rooms.
The government favoured the sale of its shares in the hotel operator to an investor who would also purchase the stake owned by Hilton International.
Asked whether the Sarova Group would consider bidding for the property as an extension to its Nairobi Stanley facility, the source who sits in management suggested that “nothing was off the table”.
The source, however, noted that the owner would be obligated to first make significant investments to facelift the property to make it appealing to a third-party investor.
“Such an old hotel would require significant investments before a third-party can come in,” the source said.
The iconic Hilton Hotel fronts four streets—Mama Ngina, Watalii Lane, City Hallway and Simba Street.
Hilton Nairobi Limited has operated the establishment since its opening in 1969.
