Buckhorn: New Restoration Hardware 'reflects how Tampa has changed'
By Ashley Gurbal Kritzer
Tampa Bay Business Journal
Published: Nov 13, 2015

Restoration Hardware CEO Gary Friedman doesn't want to talk about a Plan B, should his real estate transformation fail.

California-based RH on Friday officially opened its Tampa design gallery at International Plaza, the third new-generation RH store to open this year. RH has been replacing much smaller storefronts with multistory design galleries; the Tampa store is 60,000 square feet, and others are up to 90,000 square feet.

It's a contrarian retail strategy; many in the industry are shrinking their physical storefronts and investing heavily in e-commerce infrastructure. But Friedman said RH data shows sales increase significantly when customers interact with its products versus shopping online or browsing catalogs.

"I wouldn't make these kinds of investments and build these kinds of places unless we had a great deal of data and confidence that these were going to work really well," Friedman said after a Friday ribbon cutting. "And the ones we've done so far are working remarkably well."

RH has found that products displayed in its retail stores sell "50 percent to 150 percent better" than those shown only online or in catalogs, Friedman said. Sales data plays a big role in what's available in each store.

"It's very scientific, what we do," Friedman said. "It's not just, ‘Let's build a big store.' We know how deep the market is for each of those categories, so we know what to expect."

For Mayor Bob Buckhorn, the new store is proof that efforts to transform Tampa from a back-office hub to a knowledge-based economy are paying off. He joined Friedman for the ribbon cutting ceremony at the Tampa store.

"I think it reflects how Tampa has changed," he said. "It's high-end retail, high-end restaurants, high-end craft beer, a high-end food scene - it all fits. This is part of that mosaic that's allowed us to really stand out in this state."

Retailers like RH (NYSE: RH) carefully study a market before they come in, said Paul Rutledge, a first vice president with CBRE Group Inc.

The new Tampa store validates the city as a place where luxury retailers can succeed, and Rutledge said that type of endorsement is something Tampa needs. The city "doesn't have the same sizzle" as Miami and Orlando, Rutledge said - but it's getting there, and RH will help.

"There's a lot of follow the leader in retail," he said. "These big companies have the resources - it's like rocket science."

Ashley Gurbal Kritzer is a reporter for the Tampa Bay Business Journal.