Business Case-Hilton Hotel

/kloc-one day in 0/923, Hilton came to the street in downtown Dallas and found that there was no decent hotel here, so he had an idea: "If I build an upscale hotel here, my business will be good."

After investigation, Hilton identified a piece of land, the ownership of which is in the hands of a businessman named "Old Demick".

According to the assessment, it will cost 654.38 million dollars to build this hotel. This is far from the $300,000 raised by Hilton, but $300,000 can buy the land. So Hilton found old Demick and signed the land agreement.

When it was time to pay the land transfer fee, Hilton came to see old Demick with only $30,000.

He said helplessly to old Demick, "I bought your land to build a large hotel, but after all, my money is only enough to build an ordinary hotel, so I can only rent your land."

Just as old Demick waved to say "I don't want to cooperate", Hilton said sincerely, "My lease is 90 years, and the rent is $30,000 a year. If you can't pay on time, you can take back the land and the hotel above. What do you think? "

Old Demick is beaming: the land transfer fee of $300,000 can be exchanged for the rent of $2.7 million, and the land is still his own, and the hotel on the land may also be his own.

The deal was made, and Hilton paid old Demick $30,000 for his first year's rent.

Hilton bought the right to use the land for the first year with $30,000 for $300,000, and tied a real estate developer tightly to herself. The remaining $270,000 in her pocket is still unable to build a hotel with $6,543,800+0,000. So, Hilton once again found old Demick and said, "Take the land as mortgage and loan the hotel".

In order to get all the $2.7 million, old Demick agreed.

The bank lent Hilton $300,000 according to the present value of the land, and the available funds reached $570,000.

1in may, 924, the hilton hotel started construction under the condition that the funding gap was not too big.

Soon, the hotel construction used up $570,000, and there was no money. Hilton went to see old Demick again and truthfully introduced the economic difficulties, hoping that old Demick would take over half of the hotel and contribute to the smooth completion of the hotel. He also said: "After the hotel is completed, it will be leased to me for operation, with a minimum annual rent of $6,543,800." Old Demick thinks he doesn't suffer, the land is his own, the hotel on the land is his own, and there is still a rental income of $654.38 million+every year, which makes up for the funding gap of the project construction.

On August 4th, 1925, the Hilton Hotel named after Hilton was completed and opened.

Thirty thousand dollars is a big event in two years.

If Hilton doesn't have a dollar, I'm sure he can do it.

Because his business wisdom is priceless.