In September 2010 Virgin Group announced the launch of a four-star, lifestyle hotel company—Virgin Hotels. Its first planned property, the Virgin Hotel Chicago, opens three years later in fall of 2013.

The long build-up to a hotel isn’t for lack of funds. Virgin Hotels bought the vintage-1928 Dearborn Bank Building, an office building in Chicago’s Loop area, in an all-cash transaction and has an additional $500 million committed to growing the hotel company.

“The building, long neglected and registered as a historic landmark in 2003, deserves the proper time, care and renovation we’re giving it now with the landmarks office of the city of Chicago and our developer partner, John Buck Company,” says Anthony Marino, managing partner, Leisure and Hospitality, Virgin Group and head of Virgin Hotels. “It would be quick and easy to paint it red and call it a day—but that’s not Virgin. 203 North Wabash is a substantial building with beautiful historic features—and secrets—that we’re renovating and, equally important, updating with essential modern amenities. Virgin fans won’t be disappointed.”

Converting the art deco Chicago office building may have been first on the agenda, but another property may come online first.

“I wouldn’t be surprised if we announce something that will be sooner than that,” says Marino, though he can’t say where. “We’re focused on all the major markets, New York, Miami, Los Angeles, San Francisco, the major urban centers in the U.S. We are looking at everything from renovation of existing hotels to [adaptive reuse of] office buildings. We’re looking at some ground-up development. It depends. It just so happens Chicago is an old office building. In some markets that’s the right type of product for us to pursue.

“The Virgin game plan is: We’re going to be in every major city, domestically and some international cities as well,” he says. While Virgin owns the Chicago project and plan to use its own capital for additional properties, Marino said the company is open to joint-venture deals and to management projects.

The company has no room prototypes and no plans for them. “The design of each hotel will be highly localized,” says Marino. “There will be signature, core elements from the brand that every hotel will have.”
Raul Leal, president and chief operating officer of Virgin Hotels, notes the Chicago property will fit the city, but he won’t yet reveal details because the company is still in the middle of the design process. He says it will have multiple food and beverage venues, a spa and meeting space. “That’s pretty much the formula for most of the markets,” he says.
Like all hotel flags, leaders plan to differentiate the brand. “We think that, generally, most hotels in today’s market have a kind of inside-the-box experience. That means the experience is linked to the physical property and they don’t always take a holistic approach to the total travel experience, which begins and extends beyond the hotel stay,” says Leal.

“We think lifestyle hotels, in particular, tend to take themselves too seriously,” he says. “Virgin believes all travel, even business travel, should be an uplifting experience. After all, consumers are going to some of the most interesting and dynamic places in the world. Often they return feeling drained from the experience.

“So our hotel will offer both style and substance. The objective should be when you leave our hotels you leave feeling better than when you arrive,” says Leal.

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