RH Provides an Update Regarding the Proposal to Reimagine and Restore One Ocean Drive Miami Beach

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.