Before it shuttered in 2022, the low-slung, midcentury Bearfoot Inn was an affordable and clothing-optional outpost for gay travelers to Palm Springs, California. Plasticky red loungers on the concrete pool deck faced a slab wall and then the San Jacinto mountains. According to a one-star online review, the proprietors argued with guests over the hot tub.
The new hotel on the site, Terra Palm Springs, opened last month. It’s very different. There are earth-toned rooms, wellness tonics, a Himalayan salt room and a “desert wellness” spa circuit. Nightly rates start at about $400 and could go up to $1,000, according to co-founder Soli Cayetano — making it one of the pricier stays in the desert tourism hotspot.
The extra value comes from the wellness spin, Cayetano said. “I think that social media has really popularized health and wellness,” she said. “And we are really the first movers in the Palm Springs market to prioritize it.”
Cayetano bought the property for just $2.75 million with her partners a year ago, took it down to the studs, built a lobby and treatment spaces and refreshed the rooms. She curated a massage program that includes lymphatic drainage, cupping and Ayurvedic treatments that help balance a guest’s “internal elements.” There’s also sleep optimization, red light therapy and PEMF mats with little electromagnetic shocks that stimulate the cells.
But the cupping and the electromagnetic shocks aren’t just good for guests’ health. Having a health bent can make a hotel a better real estate investment.
WTF is wellness?
For the Romans, wellness meant bathhouses, and they built opulent resorts around them, including the city of Bath. Wealthy Europeans of the 18th and 19th centuries would convalesce at ritzy hotels in the countryside. In the U.S., luxury travelers have been willing and able to shell out for stays that make them feel healthier for decades.
“Wellness is now the most overused term since farm-to-table dining,” Canyon Ranch CEO Mark Rivers said.
There’s no set definition, either. “[Wellness] can be hawking supplements online, or it can be operating resorts that have board-certified doctors and clinicians and specialized programs to help people live younger longer,” he said.
His resort falls into the latter category. Canyon Ranch is an “OG” in the space; the retreat was founded by homebuilder Mel Zuckerman in 1979 and hit on a winning hospitality strategy at a repurposed dude ranch in Tucson, Arizona. “I think he called it a fitness resort,” Rivers said. “Over time it morphed and became more sophisticated and elaborate.”
Today, there are several locations: a resort in Lenox, Massachusetts, a small retreat near Silicon Valley, a 134,000-square-foot day spa at the Venetian in Vegas, a wellness club in Fort Worth and a planned resort and residential development in Austin, each with full-time medical staff, in addition to the typical menu of nutritious food, hikes and classes. This is a winning strategy, if an expensive one for guests: The entry-level stay at the Tucson resort starts at $1,300 per person. A four-day customized health retreat called Longevity8 will run you over $20,000, though it promises to transform your life with an enormous slate of diagnostic tests and expert consultations.
“A lot of folks will say, come visit us and experience wellness. Well, that might mean a couple Pelotons and filtered water,” Rivers said. “Everybody’s chasing the word ‘wellness.’”
WELL-HEELED
For investors, the broad wellness lane could look pretty good.
The Global Wellness Institute pegged the worth of the wellness industry broadly at a whopping $6.3 trillion — that’s trillion with a T — in 2023, naming the period between 2013 and 2023 “the wellness decade.” This was “the time in which consumer interest and need for wellness became an explosive and permanent shift,” an Institute report reads, adding that the market is expected to boom to $9 trillion by 2028.
“Wellness” means lots of things by the Institute’s own definition. Beauty, nutrition, traditional and holistic medicine, tourism and real estate each have a place in the chart on the Institute’s web page. Real estate is one of the smaller bubbles, just $438 billion, while the personal care and beauty category is over the trillion-dollar mark.
The definition may be easy to fudge, but holistic ideals are in the air. Take a look through the Instagram pages of top real estate figures and you’ll notice the cold plunges, the documented daily workouts and the subtly downplayed cosmetic procedures, even the trips to cellphone-free Greek island cleanses. There are health food restaurants, organic couches and mocktails. There’s that venture capitalist who seems to genuinely think he won’t die.
With wellness already a well-loved way for the well-heeled to spend money, real estate isn’t going to miss out on a personal level or a professional one. There are business success stories already, like Canyon Ranch’s, or the Six Senses resorts, with health-conscious branding.
LOCATION, LOCATION
In 2013, wellness developer Delos Living planned a wellness condo at 66 East 11th Street in New York, supported by celeb names like Deepak Chopra and Leonardo DiCaprio. The vitamin C showers made a splash in the media, although the penthouse there hit the market for $50 million in 2013 and last sold for a fraction of that, $14 million, in 2021.
It hadn’t quite caught on. But here’s a sign of more recent times: hospitality guru Sam Nazarian announced a partnership with singer Marc Antony, investor Richard Attias and motivational speaker Tony Robbins called the Estate, which is planning 15 hotels and residences and 10 “longevity centers” by 2030. That’s an ambitious plan that bets on the notion that the wealthy are asking for more from their luxury. It shouldn’t just look good and feel good; it should actually make them better. Cleaner, healthier, more beautiful, whatever.
It’ll come at a price. Remember the $20,000 Longevity8 at Canyon Ranch? A yearly membership to the Estate’s first longevity center, at Century City in Los Angeles runs $35,000.
Compared to all that, $1,000 a night for a relaxing and hopefully holistic stay in Palm Springs doesn’t sound too bad. Cayetano, Terra’s founder, is confident. And there’s nowhere to go but up: even if Zoomers don’t have Boomer cash to spend on DEXA body scans, “the new generation prioritizes their health and wellness more than older generation,” Cayetano said. She’s looking towards a membership program, too, as a next step, where members could come and enjoy guided journeys she’s crafted as part of the spa program: “I think that’s where you can actually charge a premium.”