Hilton considers exit from Trinidad

Eliz­a­beth Gon­za­les

Se­nior Re­porter

eliz­a­beth.gon­za­[email protected]

In­ter­na­tion­al hote­lier Hilton is prepar­ing to with­draw its brand from the State-owned prop­er­ty af­ter the Gov­ern­ment failed to un­der­take ex­ten­sive cap­i­tal up­grades—es­ti­mat­ed to be over US$600,000 —re­quired to main­tain the fa­cil­i­ty to in­ter­na­tion­al op­er­at­ing stan­dards, ac­cord­ing to lease agree­ments, reg­is­tered records, pro­cure­ment doc­u­ments, union cor­re­spon­dence and in­dus­try analy­sis re­viewed by Guardian Me­dia In­ves­ti­ga­tions.

Guardian Me­dia has been re­li­ably in­formed that the ho­tel chain has al­ready be­gun steps to ex­it the arrange­ment that has gov­erned op­er­a­tions at the Port-of-Spain land­mark for more than two decades.

The de­vel­op­ment, while not yet fi­nalised, fol­lows a pat­tern of fi­nan­cial un­der­per­for­mance, de­layed cap­i­tal works, and con­trac­tu­al sig­nals.

In­ves­ti­ga­tions by Guardian Me­dia show that what is emerg­ing is not a sud­den de­ci­sion, but the cul­mi­na­tion of struc­tur­al weak­ness­es that have been doc­u­ment­ed for years.

The Hilton Trinidad was con­struct­ed be­tween 1961 and 1962 as a flag­ship de­vel­op­ment un­der the gov­ern­ment of Dr Er­ic Williams, open­ing in the same year the coun­try gained In­de­pen­dence. Built on the for­mer Gov­er­nor Gen­er­al’s res­i­dence site over­look­ing the Queen’s Park Sa­van­nah, the ho­tel was con­ceived as both a sym­bol of na­tion­al pride and a crit­i­cal piece of tourism in­fra­struc­ture.

Ar­chi­tec­tural­ly dis­tinc­tive, with its “up­side-down” de­sign and ex­pan­sive use of tim­ber and glass, the prop­er­ty was re­gard­ed as one of the most am­bi­tious pub­lic con­struc­tion projects of its time. It was al­so ex­pen­sive—not on­ly to build, but to main­tain.

From its in­cep­tion, the ho­tel was a State as­set.

That own­er­ship has re­mained, now held through the Es­tate Man­age­ment and Busi­ness De­vel­op­ment Com­pa­ny Lim­it­ed (eTecK), even as op­er­a­tional con­trol has shift­ed through var­i­ous arrange­ments.

Prop­er­ty an­a­lyst Afra Ray­mond ob­served that Hilton’s glob­al op­er­at­ing mod­el fur­ther ex­plains the de­vel­op­ment.

The com­pa­ny typ­i­cal­ly op­er­ates ho­tels with­out own­ing them. Prop­er­ty own­ers fi­nance con­struc­tion and cap­i­tal works, while Hilton pro­vides brand­ing, stan­dards and man­age­ment.

“They don’t put out any cap­i­tal,” he said.

Un­der this mod­el, Hilton can en­ter or ex­it arrange­ments based on com­mer­cial con­di­tions.

“When you want to go, you go. When you want to stay, you stay.”

If a prop­er­ty fails to meet re­quired stan­dards or be­comes com­mer­cial­ly un­vi­able, the op­er­a­tor has the flex­i­bil­i­ty to with­draw.

Yes­ter­day, Min­is­ter of Trade, In­vest­ment and Tourism Ka­ma Ma­haraj told Guardian Me­dia: “There are on­go­ing dis­cus­sions with Hilton, and it would be in­ap­pro­pri­ate for me to com­ment at this time.”

The present agree­ment gov­ern­ing the ho­tel is root­ed in a Lease Op­er­a­tor­ship Agree­ment dat­ed Oc­to­ber 1, 2003, be­tween eTecK and Hilton In­ter­na­tion­al Trinidad Lim­it­ed.

That agree­ment grant­ed Hilton a 20-year lease to op­er­ate the prop­er­ty, but it did not trans­fer own­er­ship. The State re­tained the as­set and, crit­i­cal­ly, re­spon­si­bil­i­ty for cap­i­tal ex­pen­di­ture and ma­jor struc­tur­al works.

The agree­ment es­tab­lished a prof­it-based com­mer­cial mod­el. In­stead of pay­ing a fixed rent, Hilton’s pay­ments to the State were tied to per­for­mance, cal­cu­lat­ed as six per cent of gross op­er­at­ing prof­it (GOP).

This meant that if the ho­tel un­der­per­formed, re­turns to the State would de­cline cor­re­spond­ing­ly.

The agree­ment al­so em­bed­ded op­er­a­tional stan­dards. The ho­tel was re­quired to meet Hilton’s glob­al brand re­quire­ments, which in­clude spe­cif­ic stan­dards for rooms, in­fra­struc­ture, me­chan­i­cal sys­tems, and guest fa­cil­i­ties. Main­tain­ing those stan­dards, how­ev­er, de­pend­ed on cap­i­tal in­vest­ment—an oblig­a­tion that re­mained with the State.

The struc­ture cre­at­ed a con­di­tion­al re­la­tion­ship: Hilton would op­er­ate the ho­tel, but on­ly so long as the as­set re­mained com­mer­cial­ly vi­able and phys­i­cal­ly ca­pa­ble of meet­ing in­ter­na­tion­al stan­dards.

The 2003 agree­ment ex­pired in 2023, mark­ing the end of the 20-year lease pe­ri­od.

A Deed of Vari­a­tion—ob­tained by Guardian Me­dia— dat­ed May 24, 2023 and reg­is­tered on Au­gust 4, 2023, un­der the Reg­is­tra­tion of Deeds Act, shows the agree­ment was not re­newed on a long-term ba­sis but in­stead ex­tend­ed to Sep­tem­ber 30, 2024, with pro­vi­sion for a fur­ther short-term con­tin­u­a­tion.

This lim­it­ed ex­ten­sion is cen­tral to un­der­stand­ing what fol­lowed.

Ray­mond said such a move is high­ly un­usu­al in the ho­tel in­dus­try.

In an in­ter­view, Ray­mond said that long-term ho­tel op­er­a­tions typ­i­cal­ly re­quire mul­ti-year cer­tain­ty, par­tic­u­lar­ly for in­ter­na­tion­al brands man­ag­ing large prop­er­ties.

“Why in heav­en’s name would you want to re­new for one year… if the terms and con­di­tions were sat­is­fac­to­ry?” he said.

He not­ed that a one-year re­new­al sug­gests the par­ties were ei­ther un­able to agree to longer terms or were prepar­ing to ex­it the arrange­ment al­to­geth­er.

“You don’t ne­go­ti­ate for one year. One year tells you you’re wrap­ping up.”

Ray­mond’s analy­sis of the Hilton Trinidad points to per­sis­tent fi­nan­cial un­der­per­for­mance.

Us­ing fig­ures de­rived from the lease arrange­ment and pub­licly avail­able da­ta, he es­ti­mat­ed re­turns in the range of 0.24 per cent to 0.76 per cent on an as­set val­ued in ex­cess of TT$600 mil­lion.

Such re­turns, he ar­gued, are sig­nif­i­cant­ly be­low what would be ex­pect­ed from a com­mer­cial hos­pi­tal­i­ty as­set of that scale.

“Trinidad Hilton has been on its knees,” he said.

The prof­it-based lease struc­ture am­pli­fied the im­pact of this un­der­per­for­mance. Be­cause pay­ments to the State were tied to gross op­er­at­ing prof­it, low prof­itabil­i­ty trans­lat­ed di­rect­ly in­to re­duced re­turns.

At the same time, the cost of main­tain­ing the prop­er­ty—par­tic­u­lar­ly giv­en its age and de­sign—re­mained high.

Ray­mond traced part of the ho­tel’s de­cline to struc­tur­al changes in the Port-of-Spain ho­tel mar­ket fol­low­ing the open­ing of the Hy­att Re­gency in 2008, a State-backed de­vel­op­ment.

He said the in­tro­duc­tion of the Hy­att, com­bined with the con­cen­tra­tion of gov­ern­ment events and of­fi­cial func­tions at that prop­er­ty, sig­nif­i­cant­ly al­tered de­mand pat­terns.

“Hilton comes like an or­phan,” he said.

Ac­cord­ing to Ray­mond, in­dus­try feed­back in­di­cat­ed that some ho­tels ex­pe­ri­enced rev­enue de­clines of ap­prox­i­mate­ly 40 per cent fol­low­ing Hy­att’s en­try in­to the mar­ket.

The im­pact was not lim­it­ed to Hilton. Oth­er prop­er­ties strug­gled to main­tain oc­cu­pan­cy and prof­itabil­i­ty:

· Sec­tions of the Cas­ca­dia Ho­tel were con­vert­ed from guest rooms to of­fice space

· The Mar­riott was sold by its de­vel­op­er to a cor­po­rate en­ti­ty

· Oth­er ho­tels re­duced op­er­a­tions or repo­si­tioned their busi­ness mod­els

The re­sult, he said, was a mar­ket in which de­mand was con­cen­trat­ed in new­er, State-sup­port­ed fa­cil­i­ties, leav­ing old­er prop­er­ties at a dis­ad­van­tage.

Against this back­drop, the need for cap­i­tal up­grades at the Hilton Trinidad be­came in­creas­ing­ly ap­par­ent.

A Re­quest for Pro­pos­als (RFP) is­sued by the Ur­ban De­vel­op­ment Cor­po­ra­tion of Trinidad and To­ba­go (Ude­cott) in Au­gust 2023 for­mal­ly sought con­trac­tors to un­der­take a com­pre­hen­sive re­fur­bish­ment of the prop­er­ty.

The RFP, named “Hilton Trinidad and Con­fer­ence Cen­tre Re­fur­bish­ment Project,” out­lined a wide-rang­ing scope of works, in­clud­ing struc­tur­al re­pairs and civ­il in­fra­struc­ture up­grades.

Tech­ni­cal spec­i­fi­ca­tions de­tailed the ex­tent of in­ter­ven­tion re­quired. These in­clud­ed:

· Re­ha­bil­i­ta­tion of re­in­forced con­crete el­e­ments and struc­tur­al com­po­nents

· Re­place­ment and strength­en­ing of re­in­forc­ing steel

· Re­pairs to foun­da­tions and sub­struc­tures

· Drainage works, in­clud­ing cul­verts, chan­nels and wa­ter man­age­ment sys­tems

· Road­works and pave­ment re­con­struc­tion us­ing bi­tu­mi­nous ma­te­ri­als

· Traf­fic man­age­ment works, in­clud­ing mark­ings and sur­face treat­ments

The spec­i­fi­ca­tions ref­er­enced mul­ti­ple en­gi­neer­ing stan­dards, in­clud­ing AASH­TO test­ing meth­ods for soils, ag­gre­gates, con­crete and bi­tu­mi­nous ma­te­ri­als, in­di­cat­ing a project of sig­nif­i­cant tech­ni­cal com­plex­i­ty.

The scale and na­ture of the works point to a fa­cil­i­ty re­quir­ing ma­jor struc­tur­al and in­fra­struc­tur­al re­ha­bil­i­ta­tion rather than rou­tine main­te­nance.

Sources fa­mil­iar with the project said the to­tal cost of re­quired up­grades to meet Hilton’s stan­dards was es­ti­mat­ed at ap­prox­i­mate­ly US$600,000.

How­ev­er, Guardian Me­dia was told no mon­ey was bud­get­ed for the up­grades in this fis­cal year.

De­spite the for­mal iden­ti­fi­ca­tion of these works, the re­fur­bish­ment has not been ex­e­cut­ed.

In a let­ter dat­ed March 16, 2026, the Com­mu­ni­ca­tion Work­ers’ Union (CWU) warned of “pro­longed de­lay in the com­mence­ment and ex­e­cu­tion of the pro­posed re­fur­bish­ment”.

The union stat­ed that dis­cus­sions about ren­o­va­tion had been on­go­ing for more than three years, but no sub­stan­tive work had be­gun.

In fol­low-up com­ments pro­vid­ed to Guardian Me­dia, the CWU Sec­re­tary Gen­er­al, Joanne Ogeer, de­scribed the op­er­a­tional con­se­quences of those de­lays.

Ac­cord­ing to the union, the ho­tel is cur­rent­ly op­er­at­ing at low oc­cu­pan­cy lev­els, af­fect­ing both rev­enue and staffing. Some em­ploy­ees are re­ceiv­ing as lit­tle as one day of work per week, re­flect­ing re­duced de­mand and con­strained op­er­a­tions.

“CWU is con­cerned about the lengthy de­lay in con­vey­ing in­for­ma­tion about the ren­o­va­tion of the ho­tel…The ho­tel is al­so op­er­at­ing at low oc­cu­pan­cy lev­els, and this is ad­verse­ly af­fect­ing staff and, by ex­ten­sion, man­age­ment. While the union un­der­stands that man­age­ment’s hands may be tied, it is al­so in­struc­tive to note that talks about ren­o­va­tion have been in the pipeline.

“The Union is hope­ful that a to­tal clo­sure is not on the heels of this de­lay,” the let­ter said.

“The de­lay fur­ther ex­ac­er­bates the ros­ter­ing of em­ploy­ees,” she said, adding that un­cer­tain­ty sur­round­ing the ho­tel’s fu­ture is in­creas­ing.

The mat­ter has been es­ca­lat­ed to the Gov­ern­ment. A let­ter was sent to the line min­is­ter, and an ac­knowl­edge­ment was is­sued by the Of­fice of the Prime Min­is­ter on March 17, 2026.

The emerg­ing sit­u­a­tion con­trasts with re­cent de­vel­op­ments in­volv­ing work­ers at the ho­tel.

Last De­cem­ber, the CWU se­cured an 11 per cent wage in­crease for Hilton em­ploy­ees, cov­er­ing two pe­ri­ods: June 1, 2019, to May 31, 2022, and June 1, 2022, to May 31, 2025.

That agree­ment sug­gest­ed op­er­a­tional con­ti­nu­ity at a time when mul­ti­ple in­di­ca­tors point­ed in the op­po­site di­rec­tion:

· The lease had been re­duced to a short-term ex­ten­sion

· Oc­cu­pan­cy lev­els were de­clin­ing

· Work­ers were al­ready ex­pe­ri­enc­ing re­duced hours.

Ray­mond said the fo­cus must now shift to the fu­ture of the prop­er­ty.

“We have put so much mon­ey in­to it… the ques­tion re­al­ly would be what are we go­ing to do with that prop­er­ty,” he said.

Gov­ern­ment and of­fi­cial records show that re­fur­bish­ment works at the Hilton Trinidad and Con­fer­ence Cen­tre were done in phas­es over the past two decades, start­ing with a ma­jor up­grade in 2005, ac­cord­ing to eTecK archives.

Works con­tin­ued be­tween 2007 and 2010. A De­cem­ber 5, 2017, re­lease from eTecK an­nounced a sep­a­rate $8.5 mil­lion up­grade to the pool and pool deck, which was lat­er con­firmed in Par­lia­ment in March 2018.

Par­lia­men­tary over­sight records from a 2016 Pub­lic Ac­counts En­ter­pris­es Com­mit­tee al­so show that ear­li­er Hilton ren­o­va­tion projects saw costs in­crease from $484 mil­lion to $634 mil­lion. The re­port not­ed a con­trac­tor was ter­mi­nat­ed due to per­for­mance is­sues, con­tribut­ing to de­lays and cost over­runs.

Hilton’s in­ter­nal brand stan­dards make clear that the oblig­a­tion to main­tain and up­grade a prop­er­ty rests with the own­er, not the op­er­a­tor.

A con­fi­den­tial 2018 Hilton de­sign and ren­o­va­tion man­u­al states own­ers must “strict­ly ad­here” to all sys­tem re­quire­ments and main­tain the prop­er­ty at a lev­el “equal to or greater than” brand stan­dards. It warns that any breach “shall con­sti­tute de­fault of Own­er’s Agree­ment,” al­low­ing the brand to act to pro­tect its sys­tem.

The stan­dards ap­ply to ex­ist­ing ho­tels dur­ing ren­o­va­tion and re­new­al of agree­ments, and ex­plic­it­ly state that “re­duc­tion of scope be­low these stan­dards will not be per­mit­ted”.