The big interview: Larry Korman, president and CEO, AKA
How did one luxury extended stay brand come out of the pandemic stronger than it went in? TOPHOTELNEWS takes an exclusive look at the AKA vision.
Larry Korman, president and CEO of AKA, is part of the fourth generation of the entrepreneurial Korman family, with roots tracing back over 100 years to Eastern Europe. Embodying the American dream, his great-grandfather Hyman created the family business, now known as Korman Communities, in Philadelphia in 1919.
It is this bold approach that Korman and his brother Brad took through the foundation of a serviced residences offering in 1997, with the AKA brand appearing in 2004, followed by luxury apartment brand AVE and garden-style apartment communities strand, ARK.
He is passionate about what the brand stands for, enthusing: “AKA is a way you feel. It’s about escaping chaos and creating a sense of calm, whether our guests are there for a day, a week, a month or a year. The offering stands for something special and specific.
“It’s a historic exterior with a minimal contemporary interior – this idea is a sense of home, a residence, whether it’s in a horizontal condominium or a vertical hotel. Brad and I really wanted to take this idea of a furnished apartment to its highest iteration, working with top designers and providing hotel services and resort amenities.”
Recent rapid progress
AKA’s first properties were in New York City, Washington DC and Philadelphia, with the brand going across the States to Beverly Hills and internationally to Marylebone, London in the UK in 2012. But it’s 2022 which has really been the stand out year for the luxury hospitality brand, opening in Miami with Hotel AKA Brickell, acquiring Loews Boston Hotel to transform it into Hotel AKA Back Bay, as well as the imminent launches of Hotel AKA NoMad in New York City, Hotel AKA Alexandria in Virginia and AKA West Palm in Palm Beach, Florida.
These take the portfolio to 14 properties, with a further one to follow mid-2023: AKA Foggy Bottom, repositioning the former One Washington Circle Hotel with an extensive refurbishment. Korman teased that there could also be upcoming projects in Nashville, Austin, Los Angeles, Florida, Toronto, London and even Paris. “Global cities resonate with us – they have global communities who are compassionate and appreciate design. We really want our properties to be global ambassadors, not just for AKA but for the human spirit of love, respect, understanding and peace,” he underlined.
As for how the company decides on where to expand to next, Korman outlined: “The idea is to buy distressed properties that were once iconic. You still have to have a good cost basis in order to have full fruition for the investment though, so if the price didn’t make sense, we’ve passed on properties.
“We go three-dimensionally through a property to make sure we buy right, because we want to have a full arsenal to renovate it and transform it properly. Everything is taking longer and costs more because of supply chain issues and inflation, so we need to ensure we can operate a site at the levels we want. So buying it right first matters, especially to our partners, and that’s where Brad’s side of the business, Electra America Hospitality Group (EAHG), keeps us honest.” EAHG is a joint venture between AKA and real estate operator and capital provider, Electra America.
The chain’s historic property conversion strategy was epitomised at Hotel AKA Back Bay in Boston, with Korman detailing: “We identify iconic properties that have the breadth and depth of experience, and a story. I love the idea of an older building being reimagined and repurposed to breathe new life into a city. Boston was a natural city for us and when I heard about the Loews Boston Hotel, that it was the headquarters of the Boston Police Department from 1926 to 1990, I went there and saw its potential.
“In the subterranean restaurant there was potential to add a whiskey cellar in what was the old evidence room, as well as a wine tasting room. I love the team there, they have their eye on attention to detail, which is very much within the spirit of AKA.”
The chain has built new for AKA West Palm however, as Korman could not find a historic location but wanted to be in the town. He acknowledged: “We could morph the building exactly the way we envision it, which you can’t always do when you morph old. It meant that every room and residence had a micro kitchen or full kitchen.”
So how has AKA been able to achieve this swift expansion, considering the massive upheaval the pandemic wrought on the hospitality industry? Korman recalled: “In the middle of the pandemic we thought everybody was going to get hit hard. But we never closed our doors. We went through a short-term hit where people were frightened and not travelling, but rather than doing what everybody else was, we stayed open and said we’re going to embrace the ‘sexiness’ of travel, as some people may still have to travel for whatever reason.
“We operated frugally but we recognised that we were selling the romance. Some people want the sense of home for a week, some for a year. We provide housekeeping one day a week because our properties are residences not rooms, so for longer stays it was more economical but still in contemporary luxury. This also resonated anew with people in the pandemic who needed to work in a city for a week per month, so we made a weekly offering available. We create a great work environment and we are always adapting to how people want to live – we have embraced ‘bleisure’ for years.” Korman cited the latest pioneering options as Zoom rooms, podcast recording booths, technology concierges, as well as pet spas and services.
Collaboration with other chains which some could see as rivals has also proved a boon for AKA. A decade ago, Korman worked with RXR Realty’s CEO Scott Rechler, who wanted to transform 10 floors of the 75 Rockefeller Plaza skyscraper in New York City into a hotel and serviced residences. Also involved in the project were Airbnb founders Brian Chesky and Chip Conley.
While many hotels have viewed the home rental brand with suspicion, Korman took the opposite stance: “I became really good friends with Brian and Chip. I didn’t view them as competition, I viewed them as adding something new to the marketplace, and rather than shun them I wanted to embrace them.” This approach paid dividends, with Korman recalling: “Airbnb Luxe was something we all did together. So AKA went from maybe 1% of our referrals coming from Airbnb to now getting 11% because of this relationship we put together. Airbnb taught younger Americans the benefits of a residence versus a room versus staying in a neighbourhood. That brand is at one level and AKA is at another, so once those young kids grow older we can pick up those longer stays.”
The Edition brand founder and boutique hotel segment creator Ian Schrager is another major industry face which Korman admires, describing him as his “hero”. Therefore when Schrager reached out to him during the pandemic, he was more than happy to help develop ideas for a dual branded concept incorporating AKA serviced residences and suites, catering to ‘digital nomads’ – remote workers frequently moving onto different locations to work and experience the locale.
High end supply
As AKA is a design-driven brand, it’s been especially important to the chain to work with high quality suppliers, especially as Korman noted that ordering and dispatch delays are increasing. The hotel company reached out to major names including Bulgari to provide toiletries, Sony for technology, Living Divani for upholstery, and Lema Mobili for furniture, frequently working alongside renowned designer Piero Lissoni.
AKA even sells the line of custom mattresses featured in its hotels, commissioned from Sealy Posturepedic, called a.sleep. “It’s durable and we can customise the bedding to our customers’ style,” said Korman. This curated high end approach also applies to the drinks AKA sells at its sites, partnering with Philadelphia Distilling to create a.vod Vodka and Karamoor Estate Wines in Pennsylvania for a.vin wine.
He commented: “Early on, people didn’t know what AKA was, so they judged us on certain things. So we had a well refined curated offering for the materials we use in our hotels and we quickly got identified as tasteful – it really helped our brand.”
With the attention to detail on the supply chain, property choice and investments, along with the collegiate atmosphere the company fosters amongst its team, don’t be surprised if you hear more and more about AKA expanding in the coming years.
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