Equinox
Hotels CEO Christopher Norton talks about driving rate in NYC, new developments
in CALA and Nashville, and the brand’s pipeline.
NEW YORK CITY — The CEO of
Equinox Hotels says he’s noticed a shift in luxury in the last nine years since
his company launched.
“Luxury has become much more
democratized. It’s available to more people,” said Christopher Norton, CEO of
New York City-based Equinox Hotels, noting a statistic that the largest growing
demographic in North America is millionaires. “You could debate if that’s right
or not, but that’s the fact. People want these experiences, but they consume
them in a way that’s more sophisticated and more educated.”
Norton noted that today’s
traveler is smarter than ever.
“But they also want to be more
relaxed about traveling and the way they dress, what they wear and how they
travel,” he said, noting this can present itself a lot differently than what he
calls “traditional luxury” (white gloves, brass buttons, butler service,
chandeliers and sprawling lobbies with huge flowers). “That’s a traditional luxury
approach, versus discretion, speed and comfort.
The Related Companies and Oxford Properties Group recently sold the Equinox Hotel in New York City. (Credit: Equinox)
“If you want to arrive in
sneakers, in a hoodie, you shouldn’t hesitate to dress this way,” he said. “We
give people permission to do that. It’s been very well received.”
Norton knows luxury. He spent 28
years with Toronto-based Four Seasons Hotels and Resorts, ending as
president and COO. In 2016, he was named CEO of the new hospitality venture,
Equinox Hotels, which is primarily owned by The Related Companies, which is
also the majority owner of the broader Equinox Group, which runs a fitness
empire including Equinox, SoulCycle and Blink Fitness.
Norton said it has been a great
opportunity but also a daunting challenge to go from 118 hotels to zero, and
from 50,000 employees to two. Equinox opened its first hotel in New York City
in June 2019.
Equinox’s pipeline
While Equinox’s ramp-up has been
at a deliberate pace, the company has made several announcements of late,
most recently with its expansion into the Caribbean with the 62-key Equinox
Resort Anguilla Port Nimara (the property includes 35 branded
residences, which Norton said is pretty essential to making most North America
development pencil these days). Equinox is also developing a new property in
Nashville with a pair of Boston-based companies, The Congress Group and Taurus
Investment Holdings. In 2023, Equinox established a foothold in the Middle East
with the 128-key Equinox Resort Amaala along the Red Sea coast in Saudi Arabia.
The second strategy was that we would equally pursue resorts as we would pursue urban models, because we didn’t want to get stuck 10 years down the road and be perceived as an urban brand or as a resort brand.
Christopher Norton
Norton said this development
plan has been in the works for some time.
“The strategy, very early on,
was that we would be a global brand, and we would try to be a global brand very
quickly, versus waiting and developing in one part of the world and then moving
on,” he said. “The second strategy was that we would equally pursue resorts as
we would pursue urban models because we didn’t want to get stuck 10 years down
the road and be perceived as an urban brand or as a resort brand.
“We wanted to be both, because
we also thought that we could program and activate the resort experiences very
differently.”
Norton said the plan has always
been to pursue key North American markets and said the entry into the Middle
East should also allow Equinox to expand there, with a focus on Saudi Arabia,
Abu Dhabi, and Dubai first, then moving to places like Qatar and Kuwait next.
So where else would Equinox like
to expand? London is a location the company has always looked at, Norton said.
“It’d be such a perfect addition
to us and then Europe is the next step. We have had conversations in Europe,
but it’s a bit more difficult to penetrate because of the space requirements we
have.”
Using the New York City location
as a guide, the space requirements include a full Equinox health club on-site.
Related and Oxford Properties
Group recently sold the lower half of the Hudson Yard Tower, which includes the
Equinox hotel as well as office and retail space, to Japan’s privately held
Mori Trust for a reported $541 million.
Equinox Hotels recently announced its expansion into the Caribbean with the Equinox Resort Anguilla Port Nimara. (Credit: Equinox)
Norton said Related still has an
ongoing interest in developing future properties together, but Equinox Hotels
also has the flexibility to work with other investors in different locations.
“[Related] was always open
enough, and for us, it was very helpful that if, for some reason, they didn’t
want to, or couldn’t do a deal in a certain spot with us, that we were free to
deal with other investors,” he said, noting the Middle East and Nashville deals
as examples. “We’re not confined by the relationship.”
Norton likes the company’s
deliberate expansion pace, noting the news of the Nashville development
“slipped out” before he would have wanted it to.
“We’re very careful to announce deals. I’d rather go slower. We have a few that we’re waiting on. So, I think
you’ll get a few more announcements in December and January,” he added.
“We have been quite deliberate
with looking at some of these markets, and we’re very picky with the location
and we want to keep the brand promise when we open,” he said. “I want people to
walk in these hotels and think, ‘It’s amazing. I had a great stay.’ Maybe it’s
not for everyone, but for those who would want to come and experience this type
of luxury, I think they should come.”
When asked where else Equinox
would like to expand in North America, Norton mentioned markets such as San
Francisco, Austin, Miami, Atlanta, and Los Angeles, without getting into
specifics. “We’ve pursued in all these places.”
We’re very careful to announce deals. I’d rather go slower. We have a few that we’re waiting on, so I think you’ll get a few more announcements in December and January.
Christopher Norton
Performance in NYC
Norton said others questioned
the location of the New York City hotel at first because it was in Manhattan.
“People were laughing at me and
said, ‘You’ll never get a rate above $455… $600 if you’re lucky,’” he said,
noting that the hotel will average an ADR of $1,000 for the year and is running
an average of $1,300-$1,400 per night right now. The hotel’s performance has
been exemplary, Norton said, noting it is budgeting 80% occupancy for next year
and the GOP is above 40% for 2025.
While Norton admits that ADR in
New York City, especially in luxury, is sky high with no ceiling in sight, that
doesn’t mean you can just go higher and higher when the rate isn’t based on
demand.
“We have to be careful that we
don’t get overly greedy and just make sure that the price is purely based on
demand,” he said. “If we want to play a long game, we have to make sure that
the guest leaves and feels that it was worth it, even if it was expensive.”