It all started with a chance meeting in Yakima, Washington. The year was 1930, and S.V. Thurston, a one time acrobat who found owning hotels to be a safer, more profitable line of work, stepped into the coffee shop in the Commercial Hotel and ran into Frank Dupar. Both men were part of the local hotel development scene. In 1910, Thurston and his partner Harold Maltby had formed the Maltby-Thurston Company to buy and refurbish old hotels and make them profitable again. Dupar was a plumbing contractor who had recently entered the hotel business when he took ownership of a property that was unable to pay its creditors. Both men were in Yakima looking into different hotel opportunities.
Quickly, the two men found themselves deep in discussion on the deteriorating financial situation gripping the country. Profitable hotel operations were a challenge at best amidst the economic disorder of the Great Depression. They soon recognized the mutual benefit of pooling their resources and working together instead of competing against each other. Years later, Thurston recalled the “purpose in combining was to gain efficiencies and advantages of a central organization and bring stability to a chaotic industry.” Simply put, together they could manage costs and develop new opportunities. To strengthen this partnership, the duo also reached out to Peter and Adolph Schmidt, a pair of brothers who operated five hotels in the Seattle area.
Soon an agreement was worked out among these competing hotel interests to create a new company called Western Hotels. The partners started out with 17 hotels, but soon doubled that number after they developed a new model for their company. Instead of purchasing hotels, Western agreed to manage them, applying each partner’s operational know-how to each new portfolio addition. Western is credited with the creation of the hotel management agreement or contract that is universal in the lodging industry today.
In 1931, Western took over the Multnomah Hotel in Portland, Oregon—a property that was losing $20,000 a month. Within a year, Western had returned the hotel to profitability. Word of the firm’s turnaround success with the Multnomah spread, and soon Western was signing a lot more management agreements with other hotels. Using this business model, Western survived the Great Depression and World War II. By the start of its second decade, it was a recognized force with management contracts. Early on, Western managed international hotels in Canada, then later in Guatemala, Japan, and Mexico. To signal its international presence, it changed its name to Western International Hotels in 1963. Reflecting the synergy of hotels, airlines, and tourism, Western merged with UAL, the parent company of United Airlines, in 1970. In 1981, the company adopted the name Westin Hotels—a contraction of the words Western and International. Now Westin is an internationally prominent brand under the Starwood Hotels and Resorts umbrella. And to think it all started with a fortuitous meeting in a coffee shop in Yakima, Washington.
Mark Young, PhD, is director of the Hospitality Industry Archives at the Conrad N. Hilton College of Hotel & Restaurant Management, University of Houston.