Scottsdale first to host new type of inn - East Valley Tribune: Business

Scottsdale first to host new type of inn

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Posted: Thursday, October 9, 2003 10:17 am | Updated: 1:57 pm, Thu Oct 6, 2011.

The new, moderately priced James Hotels will have a lot of the same features as the hip but pricey W boutique hotels — and that’s no accident.

The first James is set to open in December in Scottsdale, and the plan is to follow with locations in such cities as Miami, Chicago and Beverly Hills, Calif., next year.

When Starwood Hotels & Resorts Worldwide was preparing to open W Times Square in New York, chief executive Barry Sternlicht approached restaurateur Stephen Hanson about opening a restaurant there. Hanson agreed to put his Blue Fin fish restaurant in the hotel but also asked to take over room service, often an unprofitable and troublesome task. "I gave the advantage to Barry," Hanson said. ‘‘I wanted to learn the hotel business.’’

Room service gave Hanson entree to the hotel’s daily operations meetings, where he listened in on discussions of the day’s issues and snafus. For nearly two months after the hotel opened in December 2001, he scribbled notes on topics like the need for a flexible check-in setup that could accommodate huge groups and the problem of having too few elevators to deliver breakfasts to rooms. ‘‘I just sat there like a dummy — phones, elevators going down, luggage getting lost,’’ he said.

The result is a 140-page hotel operations ‘‘bible’’ that will be the backbone of James Hotels, a chain of hip-butaffordable hostelries Hanson is launching with Danny Errico, the founder of the upscale Equinox Fitness Clubs.

The hotels’ launch is a head-first leap for Hanson and Errico, neither of whom has ever owned or operated a hotel. Hanson, 54, is a frenetic food guy and scion of Sally Hanson sportswear. He also is president of the B.R. Guest restaurant group in New York and Las Vegas, which owns such eateries as Fiamma Osteria, Blue Water Grill and Ruby Foo’s. Errico, a 42-year-old fitness aficionado with a scraggly ponytail, made his fortune when he and his family sold Equinox several years ago.

Hanson’s hotel idea dawned five years ago when modish boutique hotels like those of Ian Schrager Hotels and Kimpton Hotel & Restaurant Group LLC were getting premium prices of $300 to $400 a night, and Starwood was launching its own chain, W Hotels. Hanson says he saw a hole in the market for hip hotels aimed at folks with thinner wallets.

‘‘I just think that people are so over being ripped off for staying in a cool place,’’ he said. (Since then, some hip hotels have come on hard times because of the soft economy. Schrager Hotels’ Clift in hard-hit San Francisco recently sought protection from creditors while it reorganizes, and San Francisco-based Kimpton has put a number of its properties up for sale.)

The James Scottsdale has adopted many of the hip chains’ gimmicks: The word ‘‘play’’ will be spelled out on the swimming-pool bottom in capital letters, and there will be a yoga sanctuary. In-room martini shakers will sport recipes, and the ingredients will be sold in minibars alongside risque T-shirts and condoms.

But the James Scottsdale is shooting for an annual average daily rate of about $140, which will put it in the same league as nearby Marriotts and other mid-priced hotels. The hope is that cheaper prices will boost occupancy rates as much as 10 points above those of rivals.

Hanson has hired some W managers, including the W’s director of sales and Todd Iacono, the Times Square hotel’s former operations manager who is now the James Scottsdale general manager. Borrowing another page from W, James will sell linens, robes, candles and other novelties in a James Hotels catalog.

Sternlicht, who himself learned hip-hotel secrets before launching W by exploring possible deals with boutique-hotel godfather Ian Schrager, declined to comment for this article.

These days, Hanson says, he and Errico aim to ‘‘reinvent the wheel’’ with their hotels. Their pitch is high-end technology and relatively deluxe amenities for less. So the rooms will sport 42-inch plasma screen televisions, and wireless DSL will be free. James’ software systems will track what guests order for breakfast, their favorite wines, and other information useful for marketing.

But the stripped-down 325-square-foot rooms will have platform beds and there will be no chests of drawers. Instead, guests will get wire storage racks in the closet — and a few chests in storage that can be rolled in if anyone insists. The minimalist rooms will have attention-getting orange lounge chairs and a long narrow work counter along one wall.

Errico and Hanson considered naming the hotels ‘‘Blue’’ or ‘‘Rest’’ before settling on ‘‘James,’’ which evokes James Dean, James the butler and James Brown, according to Errico. The hotel in Scottsdale is a rehab of a circa-1975 hotel that has at one time or another served as a Doubletree, a Clarion and a Holiday Inn. Purchased out of bankruptcy, its $25 million renovation is a surface-only job that will create 196 rooms and 17 suites.

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