Two Hilton Hotels In Germany Face Scrutiny Over Iran Regime Ownership

Two hotels in Germany may lose their Hilton affiliation, after the owner’s ties to the Iranian government have been exposed.

Hilton reviewing two Frankfurt hotels over Iranian owner

Bloomberg is reporting that Hilton is conducting an internal review to decide whether to terminate a management agreement with two Frankfurt-area hotels, over ownership concerns. Specifically, this involves the Hilton Frankfurt City Centre and Hilton Frankfurt Gravenbruch, as both hotels are reportedly ultimately owned by the son of Iran’s Supreme Leader.

Hilton manages these hotels under a long-term contract with Allsco Gravenbruch Hotelbetriebsgesellschaft mbH. However, the property’s ultimate beneficial owner is reportedly Mojtaba Khamenei, the second-eldest son of Iran’s Supreme Leader. Khamenei has faced United States sanctions since 2019, so Hilton is concerned whether continuing to manage these hotels could expose it to risks for violating sanctions.

An investigation recently revealed that Khamenei has a sprawling international investment network, including several European hotels. This is largely funded with proceeds of oil sales, and ownership is structured so that no assets are held directly in his name. Instead, purchases often appear in the name of Ali Ansari, an Iranian businessman who has known Khamenei for decades, as he hasn’t been sanctioned.

While Hilton has yet to make a decision, it’s interesting to note that online travel agency Booking.com has removed these two hotels from its platform, given ties to the Iranian regime.

I don’t think Hilton will take action, but let’s see…

As I see it, one could argue that Hilton should cut ties with these hotels for one of two reasons (or a combination of both):

• Because it’s ethically wrong to directly support the Iranian regime, especially in light of recent developments, which have only increased scrutiny
• Because it potentially has repercussions in terms of violating sanctions, especially with these details now being brought to light

Personally, I wouldn’t expect Hilton to take action based on the former point. I mean, keep in mind that Hilton is one of the only major hotel groups continuing to operate in Russia, as Hyatt, IHG, and Marriott, have pulled out completely.

Regarding the second point, I’m not realistically sure how much risk Hilton has from violating sanctions by managing a hotel in Germany with a “hidden” owner associated with the Iranian regime. I will say, it is interesting how Booking.com is taking action before Hilton does.

If nothing else, perhaps ownership details of these properties is something that people will want to be aware of, in terms of deciding which hotels to stay at.

Bottom line

Two Hilton properties in the Frankfurt area are indirectly owned by the son of Iran’s Supreme Leader, who has been sanctioned in the United States for years. As you’d expect, effort was put into concealing the ownership structure, but these details have now come to light.

Hilton is reportedly considering whether to cut ties with the hotel, but hasn’t yet made a decision. The hotel giant also operates in Russia, so I wouldn’t expect anything to happen there, unless they decide it’s really necessary. Meanwhile Booking.com has already removed these hotels from its platform.

What do you make of this Hilton Iran situation in Germany?