Founder of US-based Morgans Hotel Group, Ian Schrager, says: “Everything you see in hotels today – whether it’s white beds or no patterned carpets – we did that. “When somebody has a good idea, everybody runs to do it. This time, I want to ramp up quickly, so all my ideas don’t get taken again.”
You can’t blame Schrager for feeling ripped off. He’s the most copied hotelier ever. He invented the design hotel. Without him, there would be no lobby ‘scene’, no go-to bars and restaurants, no bespoke scents, no hot staff or cool nightclubs, no urban resorts and no baffling taps in the bathrooms. Today, you find these everywhere. Hyatt, Starwood, InterContinental and Hilton, and just about every small operator from Sao Paolo to Sidcup have all ‘borrowed’ his ideas and in the process have killed what he created.
“Whenever I hear the phrase ‘design hotel’ these days, I cringe,” Schrager frowns. “The idea has been so copied, it’s perverted. Every hotelier jumped on the bandwagon even though they didn’t understand a thing about it. It’s become all about getting lots of expensive finishes and flourishes, even though there is no vision behind it. I hate it.”
Well, now it’s time not just to get mad – but to get even. In the biggest, boldest risk of his career, the man who has spent a lifetime creating small but perfectly formed properties – the Royalton in New York, the Delano in Miami, and St Martin’s Lane and the Sanderson in London – has signed a £2bn joint venture with the world’s biggest hotel chain, Marriott, to create a fashionable but affordable hotel chain.
“I want to move on to do something that appeals to a much larger audience on a much larger scale than I’ve ever attempted before,” he says.
Chain hotels represented everything Schrager was rebelling against when he created the design hotel two decades ago but he insists the big-name copycats have created an opportunity for a second act in American hotel life. “What’s happening in the hotel industry now is what happened 30-40 years ago. All the hotels are beginning to look monotonously similar – over-designed.
“That’s exactly what gave me my opportunity to do something different 25 years ago when my partner Steve Rubell and I started out. Then, all hotels were dully similar – under-designed. We created something very different, very exciting and the market flocked to us. It’s time to do it again.”
The ‘it’ he’s talking about is Edition. That’s the name of the new brand he has created with J W ‘Bill’ Marriott Jr, Chairman and Chief Executive of Marriott hotels.
The first opened last year in Honolulu. It will be followed by Istanbul, Barcelona, Mexico City, London, Paris, Madrid, Milan, Rome, Naples and Mumbai, Los Angeles, New York, Miami, Manchester and Edinburgh. Two dozen are planned by 2020.
Under the deal, Schrager designs every detail from the room to the food and drink. Developers build and own the buildings; Marriott runs everything; Schrager and Marriott are paid a fee and a share of the profits.
Schrager and Marriott are, by any standards, an odd couple. It’s hard to imagine the two men having anything in common other than the fact that they both spend a lot of time in hotels – more than 300 nights a year, in Marriott’s case. Brooklyn-born Schrager co-founded the hedonistic nightclub Studio 54. He was jailed for tax evasion, before moving into designer hotels.
Marriott is a be-suited 79-year-old Mormon, who started life as heir to the root beer stand in Washington DC owned by his father, and went on to create the biggest ‘cookie-cutter’ hotel chain in the world, described as “the McDonald’s of hotels”. Step into a Marriott and everything from the carpets in the bar to the branded shower gel is instantly familiar.
But Schrager insists that in this case opposites attract. “He’s not like me and I’m not like him. He can’t do what I do and I can’t do what he does. But together we can do something extraordinary. It’s a one plus one makes three.”
By combining Schrager’s aesthetic integrity and cachet with Marriott’s mass-market experience and organisational muscle, the odd couple hope to attract a younger, wealthier, more fashionable traveller and gain entry to the fastest-growing sector of the hotel market. Over the past three years, boutique hotels’ per-room revenue growth in the US, the world’s largest market, has averaged 11 per cent a year, one third above the industry norm, according to independent US-based hotel analysts, Smith Travel Research.
For Schrager, who already has more money than he could spend after selling Morgans Hotel Group five years ago, the new venture is about catching the curve, proving to himself that his trend-spotting instincts are still as sharp as ever – and putting one over the copycats. Style and the mass market are no longer a contradiction in terms, he argues. In key sectors, notably fashion and consumer goods, quality and good service are going more mainstream.
He believes it’s time for the first of a new kind of stylish, accessible brand that only he and Marriott can create.
“Consumers are more and more sophisticated and educated,” he says. “They respond to individuality and originality. The fact that you are doing it on a large scale does not undermine that. Look at Apple. Look at the way top fashion designers such as Karl Lagerfeld, Stella McCartney and Jil Sander have collaborated, with great success, with high-street retailers like H&M and Uniqlo, or the way Damien Hirst is designing sneakers for Converse.”
Schrager says Edition will be more affordable and grown-up than his design hotels but still offer his trademark sense of entertainment.
“We want to do things with style, with glamour. We want to get a rise out of people.” Each hotel will have that Schrager trademark: the ‘destination’ bar and restaurant. “We’re in an experience economy. People pay a premium for it. We will offer consistency of experience and attitude.” But, he adds: “I want it to feel more self-assured, simple, chic and modern. It does not need to shout so loud.”
Each hotel will reflect its locale and so, although the service will be of the same quality and style, each hotel will look completely different. “It will be the anti-chain chain,” Schrager grins.
When the Schrager/Marriott deal was announced, critics predicted that the two would eventually come to blows. US-based hotel analyst Jim Butler asked: “What will Schrager do when Marriott criticises the colour of the silk or some innovative design feature in the bathroom?”
Schrager admits there have been disagreements. “At the start they kept asking me for a list of approved designers, a book of standards, how big the rooms would be. I said ‘No’ because it all depends on the property and the city.”
There have been arguments over reasons for low occupancy levels at the 350-room Edition Honolulu, but design reviews have been excellent. You instantly know you’re in Hawaii, thanks to the sculpture made of smashed-up surfboards behind reception and the blue sarongs and pink ukulele in your room.
The 75-room Edition Istanbul opened in May and is an original mix of East and West. “When people see Istanbul and compare it with Waikiki, they’ll really see how well Edition can travel,” says Schrager.
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FACT FILE
- Born and raised in Brooklyn, Schrager started his career in the early ’70s as a real-estate lawyer.
- He soon quit the legal profession, teaming up with college pal Steve Rubell. With $400,000 of borrowed money, they took over a decaying theatre in Manhattan and opened the hugely successful Studio 54 club in September 1977.
- In 1984 they moved into the hotel business, converting the Executive Hotel on East 37th Street into Morgans – generally considered the first boutique hotel.
- With the help of design guru Philippe Starck, they turned their early properties into showcases of everything cool, with dimly-lit hallways, living room-style lobbies, fashionable music and an equally fashionable staff in designer uniforms.
- Rubell died in 1989 and Schrager continued to expand the hotel empire throughout the 1990s, establishing more than a dozen properties before moving on to property development and his new Edition hotel chain.
- Schrager has long had a reputation for obsessing over the smallest details at his properties. He’s been known to fly into a rage if the bouquets in the guest rooms at his Gramercy Park Hotel don’t contain precisely 10 pink carnations.
Any comments? Email cmw@mashmedia.net
