Industry Insiders: Alex Calderwood, Wild Ace

Talking with Alex Calderwood about his career arc, one gets the sense that he's a born entrepreneur. It’s not because the Ace Hotel chain that he and his partners (Wade Weigel, Doug Herrik, and Jack Barron) manage are substantive, interesting, and innovative, and therefore wildly popular right now, but because every venture Calderwood has involved himself in since his early 20s -- from dealing in vintage clothing to opening barbershops and event-promotion companies -- have been a succession of blockbuster success stories. Calderwood’s latest ventures, the Ace Hotel New York and Ace Hotel and Swim Club in Palm Springs, added a burst of creative energy to midtown Manhattan and the gay-friendly sun belt. For now, Calderwood is happy to continue building a hotel empire with soul. But knowing what we do about his inherent instinct for business, don’t be surprised if you see his name attached to more than just fabulous hotels in the future.

I know you recently traveled to Iceland. Do you have plans to expand the chain overseas?
When I travel, it’s sort of all mixed together. You never really turn your brain off. I looked at some buildings but don’t have any plans right now to open an Ace there. I’m always looking for ideas and trying to stay informed. We ended up buying some great wool accessories and found doorknobs that will tie in with our style; things like that. Wherever I go, I try to be an open sponge and soak up all the ideas I can, then loop them back into our projects. Iceland is great. We’d like to open some places in the long term, but right now we have a lot of ground to cover in the States. That said, I think we’d be well received overseas.

Before you opened Rudy’s Barbershops, you were a club promoter. What exactly did you do?
I threw warehouse parties, and that lead to producing live concerts. We made a fast name for ourselves in the music industry. This was the early 90s, and at that time, not a lot of music was coming on tour through Seattle. We focused on electronica. For example we brought Jamiroquai to Seattle during his first tour. The concert promoters weren’t bringing people to town, so we brought in a lot of great names. We ended up selling tickets for our shows at our other business, Rudy’s barbershop and promoted everything through them. There’s always been a really healthy synergy between all our businesses.

What did your parents do?
My father was a contractor and developer in Seattle, so I grew up around a lot of construction. It was great, because now that I’m building hotels, I have a really good grasp of what the building process is like. My mother was a writer for a newspaper in the 70s. She had a newspaper column called Calderwood Calling, about community news bits. I don’t know if those kinds of columns still exist. My family actually has the hotel business in our blood. There is a hotel in Scotland called the Cragley Hotel, a tiny B&B. Someone in the Calderwood family has run it for generations. I’ve never been there. It’s on my list of things to do.

At what age did you start your first business venture?
Probably 23 or 24, when I was promoting clubs. I lived above a vintage clothing store in Seattle and became friendly with the owner. One day, I walked in the store and there were these old used gas station jackets and overalls. When the jackets get worn out, they’d sell them for rags, but this vintage store had the bright idea to save them because they looked cool and were all beat up and washed out. I tracked down the owner of Urban Outfitters and we sold 1,000 of these jackets to them. I was club promoting at night and selling vintage clothes during the day. At the same time, we opened up our first barbershop. I think our investment was $12,000. I would kill to have that small of an investment in a business nowadays. Now, on average, our initial investments are something like $300,000.

What brought you into the hotel business?
It came about for a few different reasons. I was traveling a lot, selling vintage clothes. My business partner, Wade, traveled a lot with his work, so we both had a bug for travel and stayed in a lot of hotels. At that time, hotels were kind of in the air. You had Ian Schrager experimenting with different kinds of hotels, but there was still this opportunity to make them better. We came across one of the last old rooming houses in Seattle that hadn’t been co-opted or turned into low-income housing. We put a deal together, jumped into the project with both feet, had absolutely no idea what we were doing and through instinct, came up with something fresh. That put us in the business, and we started thinking that maybe we have something here. Maybe this is something that would translate to other cities. Maybe we should do this. So we did.

What do you dislike about hotels that you’ve made efforts to avoid in the design and services at your own?
What I like about hotels is getting a sense of the people behind them. I think it’s a big disappointment when you walk into a hotel and it’s soulless. I think there are different hotels for different purposes. I don’t think we do something that’s everything for all people. I don’t think we have a better model. We just do things our way and we’re successful.

When you’re opening a new hotel, do you seek out locations in areas that need revitalizing?
The way we look at it is that we’re drawn to that sort of challenge. There’s a certain permission with our brand to try something off the beaten path and work with properties organically. We never say, “Okay, what’s the next area where things are going to be happening?” For example, in Portland, the building is in an incredible location downtown, but it was on a street that was still pretty rough. We saw that the spruced-up area of downtown would eventually merge with the street where we decided to open. There were these incredible turn-of-the-century buildings there, and we knew that over time this area would attract creative people and business. And in New York, the reaction has been similar. We’re built in positive energy in that area of town and people are really attracting to that.

Apart from you, who are the main players behind the success of the chain?
We’ve been working with a wonderful developer, Andrew Zobler. His team has been a pleasure to work with, and we have a great relationship. We’re very collaborative in what we do. We keep adding people into our family and it dovetails into new, exciting projects. This adds so much to our business and services. We’re constantly adding rich layers to our brand, whether it’s collaborations with restaurants or bars. We’re creating a platform that a lot of people can plug into.

What kind of feedback have you received about the Ace Hotel in New York?
In general, the feedback is almost unsettling because we’ve been getting tremendous, tremendous positive feedback from our guests. I expected more glitches. There was a particular day when we first opened when a few things went wrong. We were having trouble with the elevators, problems with the showers, and one of our guests seemed to have a streak of bad luck and experience all of them. He got trapped in the elevator, his shower was broken, and about three other issues. He filled out a comment card and told us about the problems and then, at the bottom of the card he wrote, “I love this hotel and I will be back.”

I read that you’d like to open up a new hotel every one or two years. In light of what’s happening in the global economy, do you still feel that way?
That’s pretty accurate. I’m actually really impressed with our staff and our developer, in that we pulled off opening two hotels this year. They were both complicated and equally dynamic projects. Maybe we’ll build up the infrastructure to do more. Honestly, who knows what’s going to happen, or if the new hotels will be successful in light of this economy. I’d be more concerned if we were opening up a generic hotel. People crave substance and don’t want to be fooled by a bunch of bullshit. I think we speak to that and we’re in a unique position to do so. We’re not the cheapest, and we’re not he least expensive, but the value is there.

How do the room prices work?
The name “Ace Hotel” is taken from the ace in a deck of cards. The ace card is the high and the low card in the deck. We employ that high and low principal in our hotel models, so we have big, high-end rooms and affordable, smaller rooms for a younger crowd on a tighter budget. For us it works out great, and I am pretty confident about the pace of our development.

Can you give us details about plans for 2010, hotel-related and otherwise?
L.A. and Vancouver would be great places to build, but there’s nothing specific on the board that we’re aggressively looking to move forward with. There are definitely some ideas percolating in my head, but hotels are the main focus right now. We are bringing a lot of new and interesting features to our hotels. Custom-designed interfaces on our TVs, movies on demand—the system that we’re designing allows us to program and bring movies to our hotels, like quintessential New York movies in our New York hotel, and so on. We also want to offer a lot of independent films, more choices than you might see on a typical setup.

To what extent do you source products, furnishings, and foods locally?
It’s more of an ethos, a spirit or instinct really that we source things locally, and our customers respond to that. When you involve the community, it creates a lot of good will. People have an emotional investment in the business. The hotel becomes a catalyst for people to plug into the local community. Creating that local experience is critical. Creating something that’s very inclusive rather than exclusive has always been a successful way for us to do business.

What’s your idea of a “green” hotel?
We often get lumped into this group of green hotels, but we’re not. We want to get there, but we do have an ethos of sustainability. We use existing buildings. We don’t do gut renovations. We salvage materials. We very much like the idea of decorating with used furniture. It’s like recycling when you employ used items. Not having to make, order, and install new everything is a great way to be green. We try to build things on-site and reduce the amount of trucking and travel and gasoline. We use sustainable, organic mattresses. You can throw them away in a landfill and they will completely break down. In Palm Springs, we put the infrastructure in to cover every single building on the property with solar panels. So, eventually, we’ll get to a point we’re we’ll be greener.

What’s the strongest selling point of the Ace Hotel chain?
I love all the people that work at the hotels. I think at the end of the day, our staff is critical. You could have the most wonderfully made hotel, but if you don’t have the culture and energy of a good staff, it just falls flat.