Hotel visionary Barry Sternlicht is planning to open his luxury 1 Hotel brand for eco-travelers in Toronto.
The first 1 Hotel opened in 2015 in South Beach, Fla., with a living wall, access to a Tesla electric car and filtered water in taps and showers.
Now Mr. Sternlicht and his US$60-billion Starwood Capital Group investment firm have their sights set on Toronto.
“We are coming,” Mr. Sternlicht said in an interview. He is known for making boutique hotels trendy with his W Hotel chain, building Starwood Hotels and Resorts Worldwide into one of the world’s biggest hotel companies and popularizing hotel loyalty points.
Mr. Sternlicht has since discarded loyalty points and chain hotels for high-end luxury lodging for the environmentally conscious. He now has three 1 Hotels: in Brooklyn, Manhattan and South Beach.
Rates are running close to $1,300 a night at his Brooklyn 1 Hotel this weekend, around $800 in Manhattan and $500 in South Beach, according to Expedia.
The hotel veteran would not provide the exact location in Toronto except to say it will be downtown. Starwood Capital has signed a deal to buy an existing hotel, which the investment firm will convert into 1 Hotel, he said. The overhaul is expected to take about 1.5 years.
It will be a return to Canada for Mr. Sternlicht. Over the past few years, his investment firm sold its stakes in two top Canadian hotels, Westin Bayshore in Vancouver and Westin Harbour Castle in Toronto. Starwood is in the midst of divesting Westin properties in Calgary, Edmonton and Ottawa.
Mr. Sternlicht said he did not want to sell the Toronto and Vancouver Westin properties but had to because some of the other hotel owners wanted out.
Mr. Sternlicht said Starwood Capital was now looking at Vancouver and called the western city a dream for his eco-hotel. “We would love to be in both cities,” he said.
Vancouver and Toronto are two of the most attractive markets for hotels in Canada. In Toronto, the occupancy rate for high-end hotels is above 70 per cent and the average daily rate has climbed 10 per cent to about $330 a night, according to hotel data firm STR.
Mr. Sternlicht’s company will be entering Toronto as the luxury hotel market becomes more crowded. Bisha Toronto Hotel & Residences and Hotel X Toronto are the latest to open. Of the 81 hotel properties in downtown Toronto, 18 are considered luxury, according to STR.
As the market becomes more competitive, Mr. Sternlicht said it was critical to give guests an experience they would not forget. And much like the W Hotel developed its own following and cache, Mr. Sternlicht said 1 Hotel is doing the same.
His three 1 Hotels incorporate the surrounding elements. The Brooklyn hotel has sweeping views of the Brooklyn Bridge, original pine beams from a former sugar factory, locally sourced glass, and reclaimed bricks, marble and stone. The Florida hotel is beachfront property that also uses reclaimed materials such as driftwood, and has four outdoor pools, including one on the roof.
Mr. Sternlicht said they are beating more established brands and their occupancy rates are “running at 90 per cent or better.”
“You try to find a niche and own it. We speak to a group of travellers that care about the environment,” he said. “It defines them and it is exactly what we did with W. It said something about you.”
Even though Mr. Sternlicht once championed loyalty points, he said they are no longer a big selling feature.
“Some use the frequent flyer programs and stay within the brand that they want to collect points in, but I would say that is a vast minority of people given the performance of our hotel,” he said. “If you are just getting your points, I don’t think that is enough today because you can get points on your credit card and you can buy any hotel with them.”