Hilton won t be taking on direct credit or real estate exposure to markets in China, Southeast Asia and the Middle East. It means that Hilton is fairly insulated if China s real estate market or its credit system hits a snag.

　　The IPO of Blackstone-owned Hilton Worldwide could create an opportunity for investors looking to gain exposure to the Chinese economy, while minimizing some of the risks that are associated with the country's credit and real estate-fueled economic growth.

　　Since Blackstone Group bought Hilton Worldwide for $26 billion in a 2007 leveraged buyout that has been used by some as an example of the peak of the pre-crisis bubble, the international hotel and timeshare chain has undergone a significant, if subtle, change to its business.

　　Hilton Worldwide took billions of dollars in buyout financing when Blackstone made its 2007 investment, just ahead of a sharp downturn in the global economy and credit markets. Given what seemed like crushing debts, few would have expected Hilton to emerge from the crisis as the fastest growing hotel brand in the world. The company's redoubled commitment to franchisees for hotel growth, however, has allowed Hilton brand to expand rapidly without putting up much money by way of real estate purchases or construction.

　　In its franchise business, Hilton receives royalty revenue from developers who seek to profit from the company's iconic brand. Franchisees, not Hilton, purchase and develop the real estate.

　　Under its PE owners, Hilton Worldwide has used third-party franchisees to grow its overall room count by 36% in an over five-year stretch without taking on the financial burdens generally associated developing real estate.

　　Ninety-nine percent of Hilton's new rooms under its PE-owners have come from third party franchisees, the company advertises in its S-1 IPO documents filed with the Securities and Exchange Commission.

　　The benefit to Hilton's earnings is striking. It also compares favorably to competitors such as Starwood Hotels, Marriott Worldwideand Hyatt.

　　Hilton's franchise business now contributes over 50% of the company's overall earnings before interest, taxes, depreciation and amortization (EBITDA) according to its S-1, and adjusted franchise EBITDA has grown by 25% from 2007 through 2012. It is Hilton's fastest source of earnings and hotel growth.