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West Elm Will Open Hotels as the Mall Loses Allure for Retailers

West Elm Will Open Hotels as the Mall Loses Allure for Retailers

(Bloomberg)—West Elm, the housewares brand owned by Williams-Sonoma Inc., is the latest retailer to look outside the mall for growth.

The retail chain plans to open a line of West Elm hotels, with five locations beginning to open in late 2018. The company is working with hospitality-management firm DDK on the project, according to a statement Monday.

West Elm joins a growing faction of retailers seeking to hedge their bets. Though West Elm has been the best-performing division of Williams-Sonoma, the expansion into hotels would make the company less reliant on an often-shaky retail industry. Others are making their own efforts to diversify: Urban Outfitters Inc. agreed to buy a pizza chain last year, and Barnes & Noble Inc. is opening new concept stores with restaurants attached.

For West Elm, the idea is to build a lifestyle brand. The new hotels will be furnished with pieces that reflect the chain’s modern aesthetic, as well as local decor from the region. The first locations are slated for Charlotte, North Carolina; Detroit; Indianapolis; Minneapolis; and Savannah, Georgia.

“We’ve created an active bond with our customers that can extend beyond home and work,” Jim Brett, West Elm’s president, said in the statement.

West Elm, which has almost 100 locations in the U.S., Canada, the U.K. and Australia, includes local designers in its store assortments and has pledged to make 40 percent of its assortment Fair Trade Certified by 2019. The retailer also has teamed up with upstart companies like Casper, which sells mattresses online.

The approach has helped West Elm outshine the other divisions of San Francisco-based Williams-Sonoma. Its same-store sales jumped 16 percent last quarter, compared with a 4.8 percent decline for Pottery Barn and a flat performance for the Williams-Sonoma brand.

To contact the reporters on this story: Nick Turner in New York at [email protected] ;Lindsey Rupp in New York at [email protected] To contact the editors responsible for this story: Nick Turner at [email protected] Kevin Orland

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