Be My Guest…Starting at $3500 a Night

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You can’t really check in…but you’ll never want to check out.

The RH Guesthouse, the (very) boutique hotel property that was years in the making is only the latest manifestation of the home furnishings retailer’s quest to become a luxury brand across any number of formats and disciplines. It also represents the newest entry into the hospitality space for companies in the home and fashion sectors looking to continue to build out their connections with their uber-upscale customers.

RH Ups the Private Guest Experience

Uber-upscale only begins to describe the RH Guesthouse in Manhattan’s Meatpacking District around the corner from the retailer’s four-year-old gallery. While both properties include restaurants, that’s where the similarities end.

Along with private jets and a yacht available for lease, a second Guesthouse with a spa facility set to open before the end of the year in Aspen and plans in the works for residential properties under the RH brand, the Guesthouse is designed to make RH more than just a retailer that sells furniture.

In a personal tour of the lodging property only days after its September 7 opening, RH CEO and impresario Gary Friedman walked The Robin Report through its five stories, from the cellar-level speakeasy-style Champagne and Caviar Bar up through the ground floor restaurant, the six guest rooms, three suites, an owner’s apartment (still under construction) and a rooftop pool and lounge area with views of the nearby Whitney Museum and Highline, all the way south to the World Trade Center at the tip of Manhattan.

The rooms – which start at $3,500 a night and only go up – can’t be booked through traditional reservation services. Requests can be put in for specific stays and RH will…well, they’ll get back to you. If it seems a bit like a private club, that’s probably not a coincidence. You’ll only pass the vetting process if you arrive with no children, no pets, a good attitude, and your cellphone camera turned off: no pictures allowed.

The RH Aesthetic

Once you’re in your room/suite, you’ll find plenty of marble, white oak and cashmere fabrics, plus a fully stocked pantry with fresh charcuterie and curated premium snacks, a complete set of workout equipment behind a discreet set of doors — and two bathrooms. Friedman says nobody wants to share a bathroom, even with their significant other. There’s also a $35,000 sleep “system” in each room (that some people would call a bed) with temperature, climate and any number of other electronic controls, which take getting some shuteye to an entirely new level.

What you won’t find is any RH furniture. It’s not about being a promotional showcase for the retailer’s products, Friedman says, and that really is the defining characteristic of what the Guesthouse is for the company. Along with private jets and a yacht available for lease, a second Guesthouse with a spa facility set to open before the end of the year in Aspen and plans in the works for residential properties under the RH brand, the Guesthouse is designed to make RH more than just a retailer that sells furniture.

Branded Sleepscapes

It’s an ambitious goal – Friedman calls it “climbing the luxury mountain” – one that other upscale brands are attempting as well, albeit not from the humble origins of the original Restoration Hardware business Friedman took over in the early 2000s. Luxe brands like Armani, Bulgari, Swarovski, and Baccarat all have moved into the hospitality space over the past few years with multiple properties on both sides of the Atlantic. Ralph Lauren looked at getting into the hotel business more than a decade ago and decided against it, but they have continued to open new restaurants and even a small chain of coffee shops to expand the brand footprint.

And it’s not just luxury brands looking at the hotel business. The West Elm unit of Williams Sonoma has several properties in the works, though none have been reported to have opened yet. Niche brand Shinola opened a hotel in its native Detroit and even Muji has a hotel in Japan. Direct-to-consumer brand Parachute also has a hotel…albeit with just one room, according to published reports.

Residential properties have also seen luxury brands move in, including auto maker Aston Martin, which now has its name on a property in Miami…car not included. Like RH, all these brands are looking for ways to more deeply connect with their customers. They are not necessarily promotional efforts but part of a larger ecosystem that takes the lifestyle concept to levels not envisioned during the first surge of coordinated products when brand extensions were more about products than properties.

Profit or Promotion?

So, are these hospitality projects profit centers or merely branding efforts taken to the extreme? It’s hard to say as most of these companies don’t break out numbers for their individual business lines. But it’s got to be a lot harder than it looks for retail brands to make this leap from apparel to accommodations. Armani has kept its hotel collection limited to just two locations for years. For home retailers, the new line of business challenge is the same although furnishing a hotel it is more directly related to their core business. The West Elm efforts were announced with great fanfare in 2016 yet it doesn’t seem like any have actually opened. (West Elm owner Williams Sonoma did not respond to our inquiry on the status of the hotel program.) And it took RH more than five years to get its nine-room property up and running from its initial start.

What’s particularly fascinating about the RH venture is that is being developed by the company itself rather than as a more traditional licensing deal. The two Armani properties both were built and are being operated in partnership with real estate developers while the Baccarat Hotel in New York City is owned by a Chinese insurance company. Along with the planes, boats and restaurants, RH clearly wants to keep control firmly in-house.

Over the years retailers have tried to be many things beyond offering places to just buy stuff. They’ve been manufacturers, wholesalers and lent their names to all manner of allied businesses. Remember a century ago when Sears sold complete houses and later when it was in the business of selling cars, life insurance and real estate?

Hotels are only the latest manifestation of the trend. But if they are like the RH Guesthouse they sure are great places to spend the night and dream big.

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