The bottom of the luscious swimming pool at the much-anticipated Gansevoort Park hotel has an enthusiastic gal painted on its bottom accompanied by the words “I’m Waiting.” Everyone is waiting and expecting this wondrous addition to 29th Street. It will soon join The Ace and Mario Batali and so many others in an East/West corridor of luxury. The Gansevoort Hotel in the Meatpacking is a success that keeps getting better. The renovation of many of the hotel’s public spaces and the additions of Provocateur, Tanuki Tavern and now Carte Blanche, has taken the property to a new level. Owner Michael Achenbaum, like all luxury hotel operators, is a perfectionist. As my assistant Alice Urmey and I were toured the Ganesvoort Park yesterday afternoon he was constantly, and always in a very gentlemanly manner, instructing workers to do this or that and paying attention to the smallest details. He even stopped to remove some fool’s chewing gum from a flawless glass tiled column. He is as excited as any new father about his new gem. The ICrave-designed restaurants and bars are simply stunning. There are balconies everywhere, outdoor decks and color and light. It’s a forward design that is both chic and accessible. It’s for a smart set that demands smarter service and amenities as the boutique hotel industry learns form itself how to thrill it’s guests.
We retreated from the saws and hammers of the frenetic crews to a sprawling, luxury suite to do this interview. The property’s sound is by the world famous Lord Toussant, who did Pacha’s legendary system. He is an artist, and worker bees were scrambling to prepare for his arrival. He is one perfect piece for the perfect puzzle that Michael and his team are creating. We talked for hours and I’m sure we could have gone on for days. Greatness comes from enthusiasm, talent, experience and smarts. Michael Achenbaum is all that.
You renovated the lobby of the Meatpacking. Everyone makes mistakes or underestimates or overestimates real conditions. You are not daunted by these errors. You recognize them, and you adjust, you change, you perfect, and invariably the end result is ten times better than it was before. You recognized the way you built the space wasn’t the way it worked or should’ve worked, and you made an adjustment. Let’s talk about this adjustment. We realized that when we had done that hotel, our experience previously had been more of Holiday Inns and Hiltons as far as hotels. When we did that front lobby originally, we didn’t have a true understanding of the idea of the social environment for your front lobby. Especially with the interaction with what we have with our rooftop, it became a very difficult space and it never really fulfilled its potential to become a separate social entity. By doing the renovation, we felt that by using ICrave, who do lounge and restaurant spaces, we would create a space that was incredibly guest-friendly. That particular renovation wasn’t done on its own, it was combined with eight million dollars worth of renovations that we’ve done to our food and beverage in the past year: Bringing in Michael Satsky and Brian Gefter to do Provocateur; Jeffrey Chodorow doing the Tanuki space; Renovating the rooftop where we put a lot of time and effort into tearing out Plunge and creating a new feel and sensation with Deborah Anderson’s art and the light boxes on the wall. We really tried to reinvigorate that space even though our numbers were up last year.
It’s arguable that in the last ten years the major trend in hotels has been the importance of food and beverage. You have taken this to a different level . Not only do you have lounges, clubs and restaurants driving your hotels, you also have pools. This is unique to your group. We look at a lot of our competitors, and there’s a reason why clients go to the various hotels. I don’t always agree with everything they do and they don’t always agree with everything I do. Not on a personal level, but just on a business level. We try to balance the fact that we have a huge food and beverage component, as far as our revenue sources, with providing a higher level of service in our opinion, than most of our competitors. When you look at our numbers, over 75% of our profits come from the rooms business. It is actually quite different than a lot of our competitors, where I think their profits really come out of their food and beverage. One thing we do gain from having a Provocateur, a Tanuki, Carte Blanche, the new lobby bar, the renovated Plunge, is that it brings renown to the product and helps push your occupancy. And when you push your occupancy you can push your rate. And that’s what we’re really trying to do—get that undercurrent of velocity on sales of your rooms so that way you can achieve a higher room rate earlier. If you don’t sell your room until very late in the game and you’re only selling them three days ahead of time, you end up having a very difficult time raising your rates and you end up selling them below what you could have otherwise achieved. For example, going into August we were already 63% sold for the entire month of August. We now have the ability to push our rates on those last 37% of our rooms. It sounds crazy, but I’ve run 96% occupied for almost the last four months.
The word Gansevoort is a very strange word. Before, when people would go to Florent, which was the mainstay on Gansevoort Street back in the day, no one could ever pronounce it right. When you were calling it the Gansevoort hotel, was the difficulty of the name a consideration? It wasn’t actually my first choice to be honest. It was my architect’s choice, and I will give him credit, Stephen Jacobs. He suggested it because when we bought into the project, and we ended up buying out our partners, we started to attend meetings about land-marking the district. The area is actually a landmark district called the Gansevoort Market. It’s not actually called the Meatpacking District, even though it’s always been referred to that way historically. It’s almost like calling your hotel The Soho if you were in Soho. At the same time, we were very concerned that people would be unable to pronounce it properly, but I believe that one of our greatest achievements was something written about in the Post. The New York Post ran a brief story about the top places in New York City as far as drop off and pick up points for cabs, and the number one besides the airports in all of New York City was 18 Ninth Avenue, which is our address. It’s not only people coming to us, though a lot of them were, it’s also a lot of people who just say take me to the Gansevoort Hotel in the Meatpacking District as a launching point for wherever their evenings will take them.
I absolutely do that. I know my cab driver knows where it is, and no matter where I’m going over there, whether I’m going to Spice or getting my hair cut at Bumble and Bumble, I say take me to the Gansevoort Hotel. What’s great about that for us is one, it’s in the back of your mind, and two, that people know how to pronounce it now. That was one of the things I loved about it, because I thought people must know how to pronounce it if everyone knows how to get there now. It was a scary thing at first, but we also felt that it was the intent of the hotel, the intention of our design and everything was to create an experience that would attract a lot of people from Europe, from the West Coast—that kind of clientele. We felt that was an appropriate use of that name. Stylistically, we did a lot of things that tied back to it being Dutch. The actual font of our logo is a Dutch font. There are a lot of details that most people aren’t even aware of. Gansevoort actually means forward goose, the lead goose. So we have a little goose that comes on the bed and quacks.
You just discussed the clientele that comes to the downtown Gansevoort. Now you’re opening this one on 29th and Park, which is an area that I’ve been visiting for years. Is there going to be a difference in clientele at the two hotels? The perception of the downtown hotel is that we’re almost all transient and media, but at the same time we are 35-45% corporate under normal circumstances when the market is stabilized. Group business has historically been about 5% of our business. We expect that to continue. We do expect there will be some cross pattern because people are going to want to experience the new hotel, but there’s a clientele that always wants to be in the Meatpacking District and there’s a clientele that always wants to be in Soho. There’s going to be a clientele that wants to be there no matter what, because socially that area is very specific and very special. As the Whitney and all of these other places come down there, it’s just going to get better. But at the same time up here, we think that this hotel, with the design we’ve done, with room sizes, the finishes, and the overall product that we’re building here, we feel that this hotel is truly designed to compete with the Peninsulas, Four Seasons, and Palaces of New York City, rather than being considered a downtown hotel stylistically. What we’re trying to do here is provide, from lobby to guestroom, a Four Seasons experience. Service-wise, room appearances, and amenity-wise. At the same time you have the social options of a downtown hotel. We don’t think anyone has ever done that in New York City.
There’s a bunch of hotels being put up along this 29th Street corridor. 29th Street was historically one of the worst whore-ridden blocks in the city. This was a very bad block. It can’t be worse than what the Meatpacking was (laughs).
But the neighborhood has completely changed and continues to grow. When you look at Soho and Tribeca, these areas excel because of the physical layouts of the buildings. It’s lofts and townhouses, whereas the East Village is tenements. It’s now a growth neighborhood. Is that why you’re here? Do you see 29th and Park as the next neighborhood? As far as location-wise for our clients, it’s a great fit right between the downtown market and the uptown market. Being able to have somebody who is able to go to meetings fifteen blocks away, right in Midtown, is a great bonus to our clientele. At the same time, we definitely saw it as a growth market, just as when we went into the Meatpacking District we felt there would be a lot of growth around us. A perfect example of that was one time I met a real estate broker, and he didn’t know what I did, and I asked him what he was working on. He said he’s moving a client that is similar to a Paragon from another city to New York, and he said he’s moving them to Park Avenue South. I asked him where on Park Avenue South, and he said he wants to be near the new Gansevoort, but not so close that he pays the premium. We really believe that with us, the Ace, the new Batali coming in, and some other major players coming into this market, you’re going to see a huge pop in this area. We had faith that if we came, others would follow.
In Las Vegas, retail definitely drives hotels and in turn the casinos. It’s less so with the properties in New York. If you look at the Meatpacking District as one giant mall with the clubs and everything like that, you have these great stores around it. But over here on Park Ave it hasn’t been the case. Lacoste is committed to having a store in the hotel. How much will retail drive hotels? I’m very interested in doing this store because it’s a very unique concept and I really believe in Steve Birkhold’s vision of where he’s taking his brand. For me, it’s a great brand association because he’s going to be doing not only his classic look and yearly changes in that look, he’s also going to be doing partnerships with major designers to do special edition products with us as well. He’s also going to be doing special edition shoes designed by well-known Japanese designers.
You told me that you and Andre Balazs are different players, and sometimes disagree. What are the differences between Andre Balazs’ approach and your approach? As far as the food and beverage, we have different perspectives on it. Andre does most of the food and beverage in house, while we’re partners in our food and beverage operations. But I really respect the knowledge that others who have been very successful in their industry bring to the table. Their branding adds value to my property. I think it’s worth having a better pie and maybe having a little bit smaller piece of that pie, than having a pie of crap. Maybe that’s not the nicest way of saying that (laughs). From my point of view, I want to ensure—because you have to remember it’s not just your restaurant and it’s not just your bar. It’s your room service, your catering, and all those things. As much as people think you can put something together and just do it yourself, a lot of times you just don’t do a great job. The first person to ever do it successfully was Ian in partnership with Jeffrey Chodorow doing Asia de Cuba and all of these different concepts together. Ian clearly saw the value in bringing in great operators to do work with him. He changed the whole business model to food and beverage being a driving factor in your hotel product. I think a large part of that was Ian’s background of having been at Studio 54 and understanding that being the social center of something was so relevant. Up until that time food and beverage was a losing department for almost all hotels in the world. Almost no hotels made money on it, and they certainly didn’t make money on it if they took into consideration capital cost. Usually when people would see the value in a hotel’s food and beverage, they would ignore the fact that there was a huge capital influx that had to go in initially, and they wouldn’t take that into consideration by giving no return to the owner.
Most hotels just put in food and beverage because they need to service the clients. They have to have room service, so you might as well have a restaurant and hope for the best. Ian changed the whole game by creating a place where the food and beverage was a social center. I think there was a lull in this for a few years after, and it’s coming back really strong right now with the Bowery, with us, with Ace. Hotels and the different environments set at the hotels are becoming the social centers of the city.
You’ve built the downtown Gansevoort and the Park Avenue Gansevoort from the ground up. Being a perfectionist, you’ve learned a lot of lessons from the Meatpacking Gansevoort, such as sound proofing, locations of elevators, and bathrooms. There were a lot of problems downtown, which you adjusted. I’d like to point out that most of these problems were due to success beyond reasonable expectations. The property is so popular that elevators and hospitality were originally unable to handle the needs. What accommodations or adjustments were made in design at the Park Avenue location for food and beverage? We have a three-level rooftop with two interior levels and one exterior. We over-elevated the hotel. We have two express elevators to the rooftop that have seven thousand pounds of lift and they run high speed. Our elevators are going to run express from the ground to the rooftop. We no longer have those elevators stopping and also they don’t interfere with my guests’ hotel experiences because they’ll have their own separate elevator from the lobby. These elevators come off of a separate entrance, which is another factor. We’re not having a line outside of the hotel entrance. We’ll have the line on the Park Avenue side with a separate entrance and a long corridor where we can have guests wait as well. And then you release them from that corridor to the elevators, both of those elevators running express. The express elevators literally take twenty or thirty seconds to get up there. We created back corridors from one side of the hotel to the other, so that both staff and patrons always have access, and are never caught on one side without bathrooms. We did far more bathrooms per guest than we had originally done with much higher-end finishes. We built an indoor/outdoor pool. That way it’s truly usable all year round. I’m not a huge fan of indoor pools, so by having it the way we set it up, the indoor pool opens to the outside pool. During the summer it’s completely open air, and if you’re using the interior portion of the pool during the winter you can actually dive through the door and come out on the outside. You don’t have to have that chlorinated sensation when you’re in the pool. We built a full kitchen on the roof so the service and the speed at which patrons get their food is far greater. We built many more bars, and each space has an outdoor area right off it, so if people want to smoke they do have that option rather than us telling them they have to go downstairs or find one spot on the roof where they can smoke. The fact that we built five interior spaces on that roof plus the indoor venues gives us the option to hold several events at the same time. I can now run an event on the entire penthouse one, and still have penthouse two and the roof deck available for something else. I can take the Red Room, which is one of our event spaces on that rooftop, and sever it from all of the other spaces. That way I can still have a private event there for 100 or 200 people, but the rest of the rooftop is available for other events or standard bar service. It gives me much more flexibility by being able to divide up the space.
Does the term “boutique hotel” have any meaning anymore? Not really, in my opinion. I think the world has bastardized that term to the point where it really just means a stylish hotel, or a hotel that is in large part food and beverage driven. I’m 249 keys—how boutique can I truly be? We feel that we offer a high level of service and style, and a lot of social options, but I feel that to be a true boutique hotel, you have to look at hotels like those in England. Tim and Kit from the Crosby. Their hotel is in London, with that bed and breakfast kind of service, though a higher level of service. They were really elegant, smaller, and had 75 keys. When you start getting into hotels that are 150 to 300 keys, it’s very hard. When Ian did the Hudson while he was working at the Morgan Group, he totally flipped this concept on its head. He took a concept of what was boutique, and truly made it fun and stylish. That’s fine, because it doesn’t matter what you call something, it’s the experience the guest has that’s far more relevant. As long as you’re providing a certain level of service and that experience you come to expect, I don’t care what you define me as. I’d prefer to be called luxury.
Luxury is a good word. I’ve been to the Hudson recently, and it’s amazing. It’s better than it ever was. Where are you going in the next five to ten years? Where is this brand going? We’re going to try two things. We want to grow through third party management deals and development. The problem is the product always has to exceed what I’ve done originally. I look at the original Gansevoort and I think it’s a great product and I think it more than suits its market, but I always want to do better. As you said, people in my industry are perfectionists. I look at it and I say, we’ve built a great product, but we can always do better. There are other projects that we are in discussions with about building Gansevoort quality products, but at the same time we are looking at creating a sub- brand. This will give us a little bit more flexibility, because I don’t necessarily have to have a full rooftop pool, or I don’t have to have a full service spa. I could have just the gym. I need that flexibility because I won’t do a Gansevoort without certain amenities. I will never build a product that will disappoint my clients if they come to a Gansevoort property. Some of my competitors have been much more willing to take on many different products, and that’s a different business model and I understand it, but I want people to know what they’re getting when they book my rooms. That’s why I’m very adamant that Gansevoort maintain a different level, and then I’m willing to look at alternative products that will still be vibrant and fun and offer the same level of service, but maybe don’t offer the full array of amenities that a Gansevoort would. That’s another direction we’re thinking of taking, not only our own management development, but also third party deals.
Another thing Ian has done, and we talk about Ian because we both love him and he’s such a genius and innovator, Ian has attached residential to his hotel. Is there a possibility you might do this with future developments? We had done that in Miami, and that was the problem with the project. As a hotel, it was perceived as very successful, but it was cross-collateralized with 255 condominiums that I couldn’t sell. Of those 255, I sold half of those and people walked on their contracts. It’s not that I wouldn’t do residential along with it, but my preference because I am a long-term holder, would be to do a beautiful rental job.
Tell me about Carte Blanche—the ups, the downs, your aspirations. The name is an apropos name for what we’ve created, because we feel that it’s a little bit of something for everyone. You have the opportunity to go in there and there’s so many different things you can enjoy there. You have an outdoor deck, you have a pool table, you have a seating area with a lounge feel to it and DJs in the front lobby. You have a deli counter where you can take out, a seating area, where you have tables and that area. We feel that it hits a number of different constituencies that would enjoy that space, and really revitalizes and invigorates that corner.
It makes you more accessible to the public. Many times you have to go into a hotel lobby to experience it. This being on the corner, the brand isn’t so intimidating. I eat at the Peacock Alley at the Waldorf constantly because it’s a great little place to have a meeting or rendezvous. But no one would ever think of going to the Waldorf to have a meal. The brand is intimidating. A trendy hotel can be intimidating but with the High Line and the shopping bringing a diverse clientele you’ve made the Gansevoort more accessible. The fact you had people walking in, whether it be guests, children with their parents, beautiful models, and they see a pool table, it’s something that draws you to it. It’s an opportunity for people to meet and socialize around this environment. That’s what we really wanted to create, because as I said earlier in our discussion, I felt our original design was proper. It shouldn’t be proper; it should be comfortable and entice you in. That’s what I want for my lobbies. While the new one here, Gansevoort Park, is very beautiful—the furniture is far more comfortable than the furniture in the first hotel. There’s a fireplace—it has certain elements that are going to draw you in either way. That lobby, I felt I couldn’t find a seat that I felt comfortable in. I always felt disappointed that we had not done a more appropriate job of catering to our client. I feel that this new product really does. Jeffrey Chodorow has done a spectacular job with the food—a really unique menu with crepes, carafes of mixed drinks, a great bar menu—and there are all of these different ways to experience it. The food is tremendous and we feel that the price point of what we’ve given is something that is appealing to the neighbors in the area, the businesses in the area, and also to our clients. When you go out to most of the places in the Meatpacking District it’s quite expensive, and this is an alternative that’s a little more relaxed and price sensitive.