Corinne Verdery on ‘shining the apple’ at Rick Caruso’s property empire

When wildfires swept through Los Angeles this January, some of the city’s news crews turned their camera lenses on an outdoor shopping center in the Pacific Palisades. Private firefighters hired by Rick Caruso, the real estate developer who ran unsuccessfully in 2022 to be the city’s mayor, kept his Palisades Village estate almost unscathed.

The privatized response proved contentious, but reflected a no-expenses-spared attention to detail that has made Caruso’s properties among the industry’s most successful. Since turning to politics, he has handed day-to-day leadership of his eponymous company to Corinne Verdery, a trained architect and former NBCUniversal real estate executive who used to oversee theme parks such as The Wizarding World of Harry Potter.

Caruso, as a private company, discloses few details of its finances, but claims a record of 17% compound annual growth in net operating income over 38 years and says last year’s results were the best in its history. Occupancy at its properties exceeds 99.5%, while revenues from partnerships with the likes of Apple and Disney jumped 26% last year. Taylor Swift premiered her Eras Tour movie at The Grove, where events including an annual Christmas tree lighting draw enthusiastic crowds.

As Verdery works to reopen the smoke-damaged Palisades Village by next summer after a reported $50 million investment, she is also planning to add more than 40,000 square feet of retail and restaurant space to other properties by 2027.

At Caruso’s Rosewood Miramar Beach resort, where the average daily room rate is $2,500, the plan also includes providing 26 apartments for employees, priced in line with state and county guidelines. It is a novel corporate response to the intensifying affordability crisis fueling anxieties about California’s $4.1 trillion economy, prompting Gov. Gavin Newsom to overhaul environmental laws to encourage more development.

Caruso’s political campaign put his company “under the microscope,” Verdery says, but “I think it has helped us, put us on the map nationally.”

This interview has been condensed and edited for clarity.

Andrew Edgecliffe-Johnson: How has Caruso managed to create retail experiences that others have not been able to copy?

Corinne Verdery: At the core of it, we create these unforgettable places that people really want to spend time at. We also never sell our real estate. So, because we have a very long-term view, we reach out into the communities that we serve, and we build lasting relationships with them. We’re looking at long-term, legacy development — that, over time, they become places that the community adopts as their own.

With that long-term view, you’re looking first at developing a property that’s going to last a lifetime. So you’re looking at design, materials, and construction; you’re looking at how to build this property that will span generations; you are looking at the investment and development in a very different way.

We also are listening more to communities and what they need, not just at the first generation of a development. You’re evolving it over time as the community around you develops, so you’re constantly refreshing your property. I call it shining the apple. You’re constantly making investments and pivoting and moving with market demand. And since you have such strong relationships with your guests, you really have your ear to the ground on when there are different trends or different needs and a different demand in the market.

Property in cities like LA is expensive, and many employers recognize that their employees have to travel a long way for work. But how do you calculate the cost-benefit analysis of providing employee accommodation at Rosewood Miramar Beach?

We have hotel employees there that are driving significant distances to get to work, and we want to make sure that we’re part of the solution. The retail there, as well as the market rate residential [accommodation], will help us pay for some of the employee housing. It’s the right thing to do. It’s also good business. It’ll help us remain very competitive in the market in terms of attracting the best and the brightest to our hotel employee base. It’s something that we think everybody should do. Housing is so expensive in California, especially in places like Montecito and Santa Barbara.

Retail has been affected by tariffs, and there are concerns that further inflation might hit consumers. Are you seeing any impact?

We’ve been monitoring it closely, but so far this year, we have not. We stay close with our tenants. Obviously, everybody is concerned and monitoring it, but we haven’t seen the impact on our properties. Our foot traffic is up this year, and summer has just been tremendously successful for us. The hotel is up. The retail properties are up. Business is strong right now, and we’re expected to exceed our attendance and [profit] projections for this year over last year.

How does your experience at Universal inform the work you do at Caruso?

I’ve always worked at that intersection of real estate and consumer experience. Rick was the first commercial developer that I had met that led with the customer experience and created these legacy developments that become part of the community. I thought you could only do that in the entertainment industry. In the theme park business, as well as Caruso, we ensure that there’s something for everyone to enjoy, and we work very hard on enhancing the guest experience at every single touch point.