RH Provides an Update Regarding the Proposal to Reimagine and Restore One Ocean Drive Miami Beach
26 September 2023 - 9:07PM
Business Wire
RH (NYSE: RH), the leading global design and hospitality brand,
provided an update regarding its intention to reimagine and restore
One Ocean Drive, Miami Beach and the ongoing RFP process for this
iconic public property.
RH Chairman & CEO Gary Friedman has provided the update
regarding the Company’s vision for this historic property in a
letter to the City of Miami Beach:
To The Honorable Mayor and Commission of the City of Miami
Beach,
While disappointed that our proposal was not recommended for
selection, we continue to believe One Ocean Drive is one of the
most important addresses in the world. Our goal from the beginning
of this process was to deliver something that the City and its
residents could be proud of, and that would cement Miami Beach’s
place as one of the most important global cities for architecture,
design, creativity, culture, health, wellness, food and wine.
RH’s proposal included an investment of $150 - $170 million of
site improvements, over $50 million of public benefits, a minimum
guaranteed rent of $333 million to the City (which was 1.75 times
to 2.8 times greater than the other proposals), a $6 million
upfront payment (the only true upfront payment not being credited
to future rent), annual tax revenues of approximately $1.65 million
in year one, and a net positive economic impact of nearly $500
million, offering a truly transformative opportunity for the City
of Miami Beach to “do well and do good” for its residents.
We thoroughly enjoyed meeting with many residents of Miami Beach
and the South of Fifth neighborhood and appreciate the community’s
universal desire for complete transparency in the determination of
the destiny of One Ocean Drive.
We continue to believe in our vision for One Ocean Drive, and we
hope that the people of Miami Beach will be given a meaningful
opportunity to have a voice in defining the future of this
irreplaceable public property.
Miami Beach is a world class city, One Ocean Drive is arguably
one of the best addresses in the world, and this RFP gives the City
of Miami Beach the opportunity to make certain it becomes so.
While this process has certainly seemed rushed, our sense is
that due to the ongoing litigation, upcoming elections and the fact
that the current operator has 2.5 years left on their lease, the
final outcome will remain uncertain for some time.
RH remains willing and ready, if invited, to engage with the
residents and City of Miami Beach to refine and improve our
proposal, resulting in a reimagination of One Ocean Drive, not only
as a “High End Beach Establishment” as the RFP requested, but as a
one-of-a-kind iconic beach destination that inspires the local
community and enlightens a global audience.
Carpe Diem,
Gary Friedman Chairman & CEO RH
CC: City Manager City Attorney City Clerk
ABOUT RH
RH (NYSE: RH) is a curator of design, taste and style in the
luxury lifestyle market. The company offers collections through its
retail galleries, source books and online at RH.com,
RHContemporary.com, RHModern.com, RHBabyandChild.com, RHTEEN.com,
and Waterworks.com.
FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements within the
meaning of the federal securities laws, including without
limitation, statements regarding the opportunity to make One Ocean
Drive, Miami Beach one of the best addresses in the world; our
intention to reimagine and restore One Ocean Drive; expectations
regarding our vision with respect this historic property; our
expectations regarding capital investments, lease terms, payments
and contributions with respect to One Ocean Drive; our expectations
regarding incremental ad valorem, hotel occupancy, plus food &
beverage taxes to the City of Miami Beach over the term of the
lease; our estimate of total public benefits from lease payments
and taxes; and any statements or assumptions underlying any of the
foregoing.
You can identify forward-looking statements by the fact that
they do not relate strictly to historical or current facts. These
statements may include words such as “anticipate,” “estimate,”
“expect,” “project,” “plan,” “intend,” “believe,” “may,” “will,”
“should,” “likely” and other words and terms of similar meaning in
connection with any discussion of the timing or nature of future
events. We cannot assure you that future developments affecting us
will be those that we have anticipated. All discussions of new
developments are subject to inherent uncertainty as to timing and
the manner in which a new development may ultimately be launched
including that certain new concepts may be canceled prior to
introduction. Important risks and uncertainties that could cause
actual results to differ materially from our expectations include,
among others, risks related to our dependence on key personnel and
any changes in key personnel; successful implementation of our
growth strategy; uncertainties in the current and long-term
performance of our business including a range of risks related to
our operations as well as external economic factors; general
economic conditions and the impact on consumer confidence and
spending; changes in customer demand for our products; decisions
concerning the allocation of capital including the extent to which
we repurchase additional shares of our common stock which will
affect shares outstanding and EPS; factors affecting our
outstanding indebtedness; our ability to anticipate consumer
preferences and buying trends, and maintain our brand promise to
customers; changes in consumer spending based on weather and other
conditions beyond our control; risks related to the number of new
business initiatives we are undertaking including international
expansion, our real estate and Gallery development strategy and our
expansion into new business areas such as hospitality; strikes and
work stoppages affecting port workers and other industries involved
in the transportation of our products; our ability to obtain our
products in a timely fashion or in the quantities required; risks
related to our sourcing and supply chain including our dependence
on imported products produced by foreign manufacturers and risks
related to importation of such products, risks related to the
operations of our vendors, risks related to tariffs and risks
related to the impact of COVID on our business; and those other
risks and uncertainties disclosed under the sections entitled “Risk
Factors” and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” in RH’s Annual Report on Form
10-K most recently filed with the Securities and Exchange
Commission, and similar disclosures in subsequent reports filed
with the SEC, which are available on our investor relations website
at ir.rh.com and on the SEC website at www.sec.gov. You should not
place undue reliance on these forward-looking statements. Any
forward-looking statement made by us in this release speaks only as
of the date on which we make it. RH expressly disclaims any
obligation or undertaking to release publicly any updates or
revisions to such statements to reflect any change in its
expectations with regard thereto or any changes in the events,
conditions or circumstances on which any such statement is
based.
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PRESS TruthGroup@RH.com
INVESTOR RELATIONS InvestorRelations@RH.com
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