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Welcome to BusinessClass.com

Commentary

The Allure Of Boutique Hotels

3. May 2021

by Varun Sharma

For too long, bigger was better. But in the 1980s hoteliers realised that smaller properties – under 100 rooms – could offer superb and a more intimate service, added privacy for guests, an increased room rate and be quirky, aiming for specific audiences. The boutique hotel boom began and has not abated. Luxury retail brands and upmarket restaurant groups have joined the party and many, but not all the results, are delicious.  

Back in the 1990s I befriended a Japanese advertising executive who was sent to London to head-up the agency’s European head office. We bonded over golf - he was as awful as me - his wish to speak better English  - and mine to learn basic Japanese - and excellent cuisine. 

We would meet every week and take turns to choose which restaurant we would dine in. We toured London over the space of a year eating our way through every type of cuisine - from 3-Michelin starred “events” to midnight bagel bars in the East End. Money was no object and the sole rule was that we were never to revisit an establishment – however perfect it was. 

Nobu on Old Park Lane


One evening I joined Ken-san at Nobu on Old Park Lane. I was tickled pink to garner the in-demand reservation and was sure that Ken would enjoy the modern Japanese-Peruvian fusion that the restaurant offered. At the time, Nobu Matsuhisa was – and arguably still is - the most famous Japanese chef on the planet. 

We chatted about The Open, the Financial Times and politics - but he was unnervingly quiet about the meal. We ate, I paid, we left. The following week, Ken invited me to dine at Miyama. After our Japanese meal the previous week, I was surprised to see that we were revisiting the same cuisine. 

The meal progressed well and at the end Ken turned to me to ask about the delectable dinner. I told him – honestly - that it was one of the most delicious meals I had ever eaten and he looked me in the eye and said: “Sharma-san, last week you took me to a restaurant where the Chef prepared food that he thought I would like. Here the Chef prepared the food the way it should be and then let me decide whether I like it or not.” It was a lesson in branding. 

Nobu Hotel London Portman Square


I note that Nobu has opened another boutique London hotel this year - Nobu London Portman Square - following the success of its first Shoreditch property. The new Nobu Hotel replaces the Radisson Blu Portman Hotel which closed in april 2019. With all the stunning grand dame properties in London including The Lanesborough, The Dorchester and and the Mandarin Oriental, and established intimate boutiques like Covent Garden Hotel, One Aldwych and The Stafford – why on earth would a discerning traveller want to stay at a Nobu?

The company is co-owned by the Hollywood great Robert De Niro – who has serious hotelier pedigree. The Greenwich opened in 2008 in New York and is comfortably one of the finest – boutique - hotels in the world. With just 88 rooms & suites, De Niro found a niche in a city crammed to the rafters with luxury hotels. The hotel offers unfussy service … consistent service … friendly service … thoughtful service … intimate service … 

The Greenwich Hotel


De Niro wanted to open a sister property in London but those plans fell to the wayside, so he teamed up with his Nobu partners and now the Nobu hotel chain boasts a number of international properties including one in Marbella and Warsaw. More are planned. You pay for a Japanese-inspired room and for blackened cod in the restaurant. 

Miso-marinated blackened cod - made famous by the chef Nobu Matsuhisa


Boutique is inherently an independent or small collection of properties with more than ten but usually less than a hundred rooms. It can focus on just one key message – in Nobu’s case, its branded cuisine - and not need to offer grand hotel facilities like swimming pool, gym, or a plush Michelin-starred restaurant. 

During the early 2000s, luxury brands realised that their over-priced goods alone could not sustain their futures and traditional advertising was becoming ineffectual. The likes of Bulgari, Versace, Armani, and Ralph Lauren entered the world of hospitality – with varying success. They relied on their established followers to move from the likes of the Four Seasons and Ritz-Carlton to these new properties which boasted branded soaps, shampoos, and rugs – all available to buy at check-out in the hotel shop! 

The Armani Hotel Dubai is located in the world’s tallest building – the Burj Khalifa


It was not just luxury brands that launched boutique hotels in that decade. In Switzerland, two McDonald’s properties were opened – the Golden Arch Hotels. Yes, the fast-food giant went one step too far – offering – well – fries with everything. The project was a veritable disaster and lasted just three years. A food brand and hotels ….?

The popularity of the boutique hotel has had an amazing effect on the traditional luxury branded hotels & resorts. They realised that for too long, they were the only address to stay in. But business practices changed and travellers started looking for more intimate & private properties. The smaller hotels could offer the latest technology, secluded locations, over the top furnishings and a home from home where to coin that phrase from Cheers, everyone knows your name. 

45 Park Lane offers just 45 rooms and suites … and the penthouse - and sits just a few metres from its much larger sister hotel The Dorchester.


I believe that boutique properties may have an issue going forward. It is still predicted that India and China will be producing the most affluent travellers in the future and these tourists are obsessed with being seen at all the right places. They want that photograph outside the George V in Paris and the Grand Hotel in Stockholm. And these hotels know it. They have been investing in their properties extensively to give their present & future guests everything the boutique hotel can offer with added 30 metre swimming pools and 1 square kilometre spas! The big brands – consolidating all the time – have the cash to splash - and they are. It is of no coincidence that many independent boutique groups are being swallowed up by the hospitality giants. 

BusinessClass.com Editor-in-Chief Varun Sharma at Jumby Bay Island - arguably the best boutique resort in the Caribbean


For me, service is and will always be the foundation of the hospitality industry. I have stayed in no star properties that have out-serviced some of the finest establishments in world. Some staff are born with hospitality in their blood – can make a guest feel like the most important in the property and still treat everyone the same. It is something that cannot be taught.

Price point is another factor. In days of old, boutique hotels offered much lower prices than the traditional luxury properties but now they are in direct competition. It is not that the established brands have lowered their prices, it is that the boutiques now offer so much more - and feel they can justify the higher ask.

The Silo Hotel in Cape Town offers just 28 rooms - and a hotel experience unlike any other


In the next twenty years, you will be looking up to the sky for the ultimate boutique hotel - as space will be the next frontier for the hospitality industry. And it will only be a matter of time before the likes of Peninsula, Four Seasons and Ritz-Carlton follow up with their own 150-bedroom properties … the ultimate stellar address.

By the way, Ken-san has retired to Tokyo and plays golf every week - by all accounts his game is still as dreadful as mine!

Varun Sharma
Editor-In-Chief
BusinessClass.com