The luxury lifestyle space is about to be disrupted by Equinox Hotels, a fitness and human-performance-focused product that has not been seen before and is very difficult to replicate – unless you have a 100-unit, upscale fitness brand in your back pocket run by developers who sweat every detail of the experience.
June 18 was the scheduled opening date at the hyped, Related Companies Hudson Yards development in New York City for the first of six Equinox Hotels under development. Related is also a partner of Equinox Holdings LLC, whose Executive Chairman and Managing Partner Harvey Spevak in 2016 hired long-time Four Seasons executive Chris Norton to lead the hotel development process.
Now the market will watch the rollout of a hotel brand that wants to own sleep with proprietary beds and related services, has 70 to 80 in-room amenities as well as a very activated public space with a 25,000-square-foot spa, 60,000-square-foot gym complex and multiple social spaces.
HOTELS spoke to Norton in early April as he prepared to lift the lid on a brand that he believes is well positioned to succeed.
HOTELS: How is Equinox differentiating itself in the lifestyle space?
Chris Norton: The definition of lifestyle is far broader, and it brings in this component of what we like to refer to as ‘serving the high-performance lifestyle guest,’ an A-plus personality. They work, they travel, they have family. They look at their days and they add up to be 30 hours, and they’ve got to get it all in.
To make it all work, it’s moving away from the old definition of the work life balance, which we believe is an outdated concept. It’s more of this non-stop juggling of priorities that all have to fit into your life. And you want to be healthy and strong, and we have realized that the newer generation believes that health is the new wealth… That extends into this entire experience – from the [fitness] club, being part of a community that is like-minded, the way you eat and drink and the way that you want to regenerate. And the regeneration piece is happening between the club, spa and the guest room, and is programmed by us in a way that all three pieces fit together under an Equinox brand experience.
H: What have been among the challenges unique to developing the Equinox hotel brand?
CN: What is new to us, and we have spent a lot of time and considerable amounts of money on, is developing integrated technical platforms. When you make a reservation at the hotel you become a Equinox club member for the time of your stay… So suddenly you show up as a guest, the club knows you’re coming, and the way we can tie service levels, seamlessness, cultural expressions and a very strong point of view on brand, both from physical design to the execution of service details, is integrated like nobody else does… We have been testing it for a year and a half. We have a lab and an in-house tech lab and every day we test, we look, we move it around, we develop content, we develop the look and feel of imagery – and it’s all proprietary and ties together for us.
H: What are you most anxious to learn?
CN: Our ability to execute consistently at a very high level. To do it well is very difficult, very complicated… I was able to cherry-pick the best of the best and pull together a phenomenal team.
H: What is the projected ADR?
CN: We position ourselves as we open at the lower part of the luxury segment. So if I were looking at five or six luxury competitors and where they sit on rates, I’d come in just below them to open. Within three years the plan is that we will be right in there with them… Based on the interactions we have had with travel agents and corporate negotiators we’re going to exceed our expectations.
H: Explain the development structure and strategy.
CN: We have worked very closely with Related Companies. For the first two properties, they developed and we come in and do the management contract with them… After New York the next one to open is Seattle maybe by the end of the year, and followed by Houston, Chicago and downtown Los Angeles, which is our largest property to date with just over 300 rooms. We are breaking ground in Santa Clara, California, this year…
There’s probably another nine or 10 where we shook hands and now have to hammer out the deals. In addition to that we probably have another 25 that we are looking at, considering, visiting, and talking to developers… We’ve started with urban domestic and looking at developing a resort in Hawaii, and that’s pretty much a done deal. Then we’re having conversations in the U.K., in London, and there are a number of conversations around taking the global strategy into the Middle East and Asia.
In some of the deals we will go in as the managing partner with some equity from a third partner. Some deals are JVs. So it’s not all in or all out. But certainly there’s always an interest in looking, even if developers need new capital or debt.
H: How does the current state of the economy make you feel about deal making?
CN: We think it actually could open up some great opportunities for us… I think it’s a concept that resonates and we already see it as we start competing with some more traditional brands and people that are out there. It’s the way we approach the business because of our association with Related – thinking like developers – and the way we lay out and program the buildings and the back-of-the-house bringing in the club and retail space for a developer. It’s a model that is very interesting and if anything the state of the economy for us is something where we could benefit from greatly. We’re very bullish.