The Ned raises the bar on City club offerings
Bet on nightlife venue pays off as Soho House entrepreneur pushes ‘accessible glamour’
It took several months for The Ned, London’s swish new members club, to work out how best to lure in the City’s bankers and lawyers: less spa, more bar.
The Ned opened its doors next to the Bank of England in April 2017 after a lavish £200m refurbishment of the Grade I listed building that was once home to Midland Bank.
By the winter, Nick Jones, the Ned founder and entrepreneur who is also behind the Soho House club network, made the decision to spend an extra £2m converting part of the beauty parlour into another bar, in a venue that already had 15 of them.
“Everyone in the world likes a good time,” Mr Jones said. “We brought something to the City that everyone appreciates . . . accessible glamour.”
Swiftly adapting to demand for more drinking space is just one part of a bet that Mr Jones — a club tycoon more familiar with catering to “creatives” and known for his dislike of “packs of people in suits” — has made on the City.
So far, that bet seems to be paying off — despite more general signs of a downturn in the hospitality sector and financial strains at Mr Jones’ Soho House brand.
In one year, the Ned has built up a 3,000-strong membership that brought in revenues of between £7m and £10m. On top of that, its 10 restaurants — most of which are also open to the public — often bring in weekly revenues of more than £1m.
While he would not reveal overall performance figures, which would also include takings from its 250 hotel rooms, Mr Jones said it took three months for the privately held venture to move into profitability.
The Ned is part of Mr Jones’ ambition to put the City on the map as a nightlife hotspot. “I know we’ve helped change perceptions of the City as far as our business — hospitality and retail — is concerned,” he said. “We’ve got lots of other business to come in, lots are looking at [the] City as a seven-day, 24-hour operation.”
The building the Ned occupies was designed by British architect Edwin “Ned” Lutyens, and the club is a joint venture between Mr Jones’ Soho House — which agreed a lease on the building in December 2012 — and New York hotel group Sydell Group.
Its encouraging first year will give a welcome boost to Soho House, whose finances have come under strain from the expense involved in a rapid global expansion. The company, which has 19 clubs around the world, was unprofitable in 2016 and in 2017 signed a £275m refinancing agreement with Permira Debt Managers.
Some fear that the Ned’s success bears the hallmarks of excess typically seen during a peak market cycle. Membership — which includes access to a bar based in the former bank’s velvet-clad vaults as well as the rooftop bar — is not cheap. A regular package costs £3,150 a year with a joining fee of £1,000. For the under-30s — about a third of the members — the annual fee is £2,000 with a joining fee of £250. It employs 850 staff.
To celebrate its first anniversary, the Ned held a pool party for about 400 members, with DJs Groove Armada providing entertainment.
Meanwhile, the wider UK restaurant sector is grappling with market saturation, rising costs and falling consumer confidence. Recent research shows profits at the UK’s top 100 restaurant groups have fallen 64 per cent over the past year, forcing numerous high-profile brands, including Gaucho and Jamie’s Italian, to restructure and look at closing branches.
Mr Jones is steadfastly optimistic, however. “We’ve been through downturns through Soho House — people still eat and drink,” he said. “I’m not saying we are above a big economic slowdown. [But] we’re very quick to react as a company, very responsive.”
The Ned has been “very careful in our pricing”, he added, particularly for the sections open to the public. “We don’t want people to come only for birthdays and anniversaries . . . but several times a week.”
The club launched at a time when corporate hospitality has come under increased scrutiny over the treatment of women, following revelations by the Financial Times of hostesses being subject to harassment at a men-only Presidents Club charity dinner at the Dorchester.
Richard Caring, the entrepreneur behind The Ivy who is one of the largest shareholders in Soho House as well as a director, attended the event and bid on several of the prizes at its auction, including a course of plastic surgery billed as “a boob job for the missus”.
Mr Jones said he was unaware of Mr Caring’s links to the Presidents Club and would not comment on the matter. But he added that the Ned had a “strong door policy” which included turning away “large groups of hyperactive blokes”.
“We couldn’t be a less men-only company. I can’t think of anything worse, none of that is good for business,” he said.
In future, he plans to expand the Ned’s capacity, to accommodate 5,000 members. And, as with Soho House, he has global ambitions.
Profits will go towards “keeping on investing and expanding”, he said, adding that he wanted to open Ned clubs in cities around the world and had already been looking at sites in New York. “Ned has a good pair of legs. We’re looking for Ned two, Ned three.”