RH: A real estate of affairs

Amid a turbulent economic climate, COVER Editor Lucy Upward takes a look at how RH is continuing to forge ahead with its capital-intensive business plan

RH’s post-pandemic financial story has been something of a rollercoaster. The company’s revenue climbed to $3.43 billion in 2025, up from $3.18 billion the year before, but that recovery came only after years of retreat from pandemic-era highs.

Thanks to tariff pressure and a stalled housing market, stock fell nearly 60% in 2025, despite RH delivering 8.4% revenue growth in the second quarter.

Against this unpredictable backdrop, CEO Gary Friedman has continued to push his flagship ‘galleries’ rather than pulling back. For years he has stated that RH is moving from curating and selling product to conceptualising and selling entire spaces, building what he calls an ecosystem of ‘Products, Places, Services and Spaces’.

For Friedman, great architecture makes the product and brand more valuable, so RH either restores historic buildings or builds new ones from scratch. With this capital-intensive approach, Friedman is betting that immersive, unrepeatable spaces do something a website never could achieve.

In COVER 81 (Winter 2025), I reported on how Friedman was dealing with tariffs and about two new RH ‘galleries’: RH Paris and RH England. Once again Friedman’s philosophy is on full display at RH’s newest and most ambitious European project:

RH London, The Gallery in Mayfair. Designed with architecture firm Foster + Partners, the five-storey space occupies an 18th- century Palladian mansion once known as Queensberry House, then Uxbridge House, and later a Bank of England building. It is RH’s first standalone London space, following its 2023 UK debut at Aynho Park and subsequent openings in Paris, Milan, Brussels, Madrid, Munich and Düsseldorf.

The RH London opening party at the end of June matched the scale of the investment, with numerous celebrity guests who were able to munch on Petrossian caviar. The timing lines up with RH’s biggest product launch in years: RH Estates. Unveiled with 165 collections, RH Estates draws on the archives of four well-known brands that RH has recently acquired: California design legend Michael Taylor, LA-based studio Formations, classical furniture atelier Dennis & Leen, and the couture upholstery house Dmitriy & Co, who will be leading RH Couture Upholstery.

Friedman has called it his most significant bet yet, saying the launch represents an answer to an opportunity and could be the biggest thing RH has ever done.

‘With the launch of RH Estates, we are removing the barriers that have segregated taste from scale, eliminating the creative limitations that have historically forced designers to choose between our scale and the uncompromising specificity of trade-only showrooms,’ he comments.

Rugs are a meaningful part of this development. RH Estates launched with twenty-three distinct rug collections, spanning hand-knotted wool and silk pieces produced in traditional weaving centres.

One standout example is the Mia rug, hand knotted from wool and silk in India, which retails for $11,425-a price point signalling RH’s push towards premium craftsmanship rather than mass-market reproduction. Alongside furniture and lighting, the rug offering is central to positioning Estates as heirloom-quality design made newly accessible.

Looking ahead, RH shows no sign of slowing its gallery expansion. The company has confirmed forthcoming standalone Estates galleries in Greenwich, Connecticut and West Hollywood, California, extending the concept beyond its integrated US and European flagships. Internationally, RH is ready for its first Australian location, planned for Sydney.

Whether or not the broader retail environment cooperates, Friedman’s motivation is clear: ‘We believe the ability to scale taste creates higher quality and greater value for both customer and the designer. RH Estates is proof that extraordinary design, craftsmanship and scale can exist harmoniously together.’

Words by Lucy Upward