Ian Schrager explains what makes boutique hotels work
Ian Schrager explains what makes boutique hotels work
29 JUNE 2016 12:15 PM

The hotel and entertainment guru shared candid conversation about the state of the boutique hotel environment.

NEW YORK CITY—Boutique hotel visionary Ian Schrager (founder of Studio 54 and the Morgans Hotel Group, and now chairman and CEO of his eponymous company), stopped by the Boutique Investment Conference earlier this month to share some no-holds-barred thoughts on what the boutique hotel industry is doing right (and what it’s doing wrong), the latest design trends and more.

Here are some highlights of Schrager’s conversation with interviewer Vanessa Yurkevich, digital correspondent at CNNMoney:

What makes a boutique hotel a boutique hotel, and what does boutique luxury mean to you?
Schrager: “It’s a singular focus, an attitude. It’s creating an elevated experience. … It’s not meant to be all things to all people. It has a very specific focus. It

can be quirky and idiosyncratic, but it’s going after like-minded people. It’s not trying to be a generic commodity.”

What are boutique developers doing right?
Schrager: “The experience in general has been elevated. The F&B, which was brain-dead in the industry, is better. People are choosing their hotels not only by price and location, and that’s good. I just worry that I’m starting to see the same kind of herd mentality I saw 30 years ago when we (Schrager and partner Steve Rubell) came up with boutique hotels to begin with.”

What are they doing wrong?
Schrager: “When (architect Ludwig) Mies Van der Rohe invented the first Modernist building, there were a lot of copies. It’s the same here. I think a boutique hotel is not about design; it’s really about attitude and approach, and about manifesting pop culture. Most people don’t understand that it’s not about design. Special effects in a movie make a good movie better, but they don’t make a bad movie good. I’m worried we’re seeing the same kinds of hotels now but in different colors.”

What’s your favorite hotel to stay at that isn’t one of yours?
Schrager: “I’m an admirer of Steve Wynn’s because he executes so well and he reinvented the Las Vegas hotels that everyone else copies now. I’m an admirer of Sol Kerzner and the Atlantis Resort. It’s a different product from what we like to do, but they’re very good at what they do. … I like what Alex Calderwood did in the Ace Hotel. What we did was activate the lobby at night and make it a fun place. What Alex did—coming from Seattle and the coffee culture and grunge culture—was activate the hotel during the day, and that was a big contribution.”

How do you make the entire hotel experience appealing?
Schrager: “You do a good product. If you have a good restaurant, people will go to it. When you have lobbies that are buzzing, people don’t want to just walk through. You have to walk that fine line between providing that fun, glamorous place that’s fun to be in, but not pretending or masking that people are walking through to go to their rooms. Now in a lot of hotels I see, (that party feeling) is forced on guests. You come back from a business meeting and have to walk through the lobby and you feel like you’re in a club. I don’t think that’s a good thing.”

Is service more important than design?
Schrager: “For me it is. I think people expect in boutique hotels to get that great look, the experience, the F&B. They don’t expect to get great service. If you layer it in … then the real alchemy happens.”

Where are the opportunities for innovation in hospitality?
Schrager: “We all know the Broadway show ‘Hamilton’ and what a success it’s been. The reason for its success, as far as I’m concerned, is that it took a very traditional founding-fathers story that’s part of our history and combined it with hip-hop music. By combining those disparate elements, it created something special. That’s where the opportunities are in this business.

“We’re in the product distinction business. You have to be willing to not follow any rules, go do your own thing, put it all together and wind up in a place you could not have logically anticipated when you started. When you do that, you’ll have a great, big hit.

“It doesn’t matter that there’s an oversupply problem in New York. Come prepared with a great product, and it’ll do great. Same with Airbnb. The best way to compete with Airbnb—which is coming after our children—is to provide a unique experience.”

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