Resorts get makeover
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10:00 PM PST on Sunday, November 2, 2008
An economic slump calls for new ideas, better planning and better business practices. Palm Springs is home to more than 130 hotels; for three of them, the slump means it's time to renovate.
The Hyatt Regency Suites, Palm Mountain Resort and the Wyndham Palm Springs all plan to renovate. Meanwhile a Portland-based hotelier plans to open a new hotel in January in Palm Springs, and the Riviera Resort & Spa finished its $70 million renovation and opened its doors Oct. 21.
"Frankly, the best time to do a renovation is when business is softer so we can take out rooms from the hotel's inventory," Hyatt general manager David Hill said. "So when the economy does return, you want to be poised to take advantage of the upswing."
The 194-room Hyatt is set to undergo a $20 million renovation in June that will finish in December 2009. Plans call for additional rooms, pool-side cabanas, fireplaces, and a poolside bar and restaurant. Once renovations are complete, the hotel will have more than 200 rooms.
"The property is more than 20 years old and it's wonderfully situated in the heart of Palm Springs, but it's also old and tired," Hill said. "This hotel is a beautifully attractive hotel, and with updates and redesigns, it will be even better."
After two years, the 24-acre, 406-room Riviera Resort & Spa unveiled its $70 million renovation. That price tag is the biggest ever for a hotel renovation in Palm Springs, according to city officials.
The renovated hotel features the new 11,000-square-foot SpaTerre, a fitness center, and more than 45,000 square feet of meeting and event space. Guest rooms were redesigned with marble bathrooms, flat-screen televisions, wireless Internet access, separate work and contemporary living areas, and private patios or balconies.
Owned by Seattle-based Noble House Hotels & Resorts, the Riviera was once a playground for Hollywood icons such as Frank Sinatra, Dean Martin and Elvis Presley. Today the hotel features five-star restaurant Circa59, the swanky Starlight Lounge and black-and-white portraits of the hotel's classic celebrity clientele.
"In today's market, although challenging, the project is still very viable," said Ted Davis, Noble House Hotels & Resorts' vice president of sales. "The Palm Springs market doesn't have a luxury resort of this caliber, and despite the economic downturn, we believe that there is a pent-up demand for this type of product, especially given the current revitalization of Palm Springs."
Business at the 240-employee hotel is exceeding expectations, Davis said. The hotel hopes to capitalize on feeder markets that include Los Angeles, San Diego, San Francisco and even Arizona.
"In this economy, we are finding that people are continuing to travel, but perhaps not as far as they may have in the past," Davis said. "We have high hopes that we will continue to enjoy brisk business."
Whether the Coachella Valley can sustain brisk business through a recession remains to be seen.
"Palm Springs has too many rooms," said Alan Reay, president of Irvine-based Atlas Hospitality Group. "The hotel market is softening in the Coachella Valley. ... Many hotel owners are bracing themselves for a protracted slowdown and are cutting costs wherever they can."
But Palm Springs is seeing an increase in its domestic and international visitors, according to Mary Jo Ginther, the Palm Springs Bureau of Tourism director.
"Palm Springs is only two hours from all major Southern California cities, which allows a year-round supply of visitors," Ginther said. "In September, we had an increase of visitor traffic, which may be due to people wanting to travel close to home."
While bookings are slower and business has been impacted by the economic slump, it is still trickling in at the Hyatt.
"We've seen our share of cancellations, but there's still business around," Hill said. "Things are changing. People have to be innovative and try different things to stay ahead and keep an edge. There's business around; it's just about finding it and getting it to come to you."
Meanwhile the Palm Mountain Resort in Palm Springs plans to expand its property and renovate in October 2009. The 120-room hotel will add 40 rooms and plans to hire 10 people to accommodate the growth, general manager Tim Ellis said.
A soft economy is a good time to renovate, he added. The 37-employee hotel can concentrate on the renovation with minimal impact on its business and guests.
Plans call for the demolition of an existing restaurant to make way for the new rooms.
"Right now, construction costs are very attractive," Ellis said. "All the materials for labor, with the exception of steel and concrete, are significantly below what they were a year ago."
As travel tightens and the industry slows, Palm Mountain Resort is enjoying business from European travelers who are booking rooms and keeping the hotel busy, Ellis said. European travelers are the silver lining in the economic mess, he added.
"Business is not bad right now. Granted we are not as busy as last year, and we've seen a slight drop-off, but it's not so dramatic," Ellis said. "Tourism is our No. 1 industry here, and we're known to be an affordable tourist destination pretty much year-round now, and we still do very well in the European markets. We just had our best summer from the European market; it's through the roof."
Ellis attributed the increase to the attractive exchange rate between the dollar and other European currencies.
Such interest from European travelers will play a role in helping the U.S. economy, according to the Washington, D.C.-based Travel Industry Association.
"Welcoming more international visitors -- who spend as much as $4,000 per traveler, per visit -- is critical to strengthening the American economy," stated Roger J. Dow, president and CEO of the Travel Industry Association, in a press release. "There is an appetite for visiting the United States."
Normally, the Palm Mountain Resort gets visitors from England and Germany, but this year, the hotel accommodated travelers from Italy, Scandinavia and the Netherlands. The hotel has also seen its business from feeder markets pick up as well.
"I think with this economy, next year people won't be looking for fancy two-week vacations," Ellis said. "They will look for a place they can drive to with good value and where they can take the kids, throw them in a pool and have a good time without breaking the bank; Palm Springs will do well next year because of that."
Also set to undergo a renovation is the Wyndham Palm Springs, which will be re-flagged as the Renaissance Palm Springs Hotel at the Convention Center after the multimillion-dollar project is complete. "With the newly renovated hotel product coming online, the Hyatt, the Riviera Resort & Spa, the (new) Ace Hotel & Swim Club, and the proposed development of the Hard Rock and Mondrian, it is very important for us to maintain our Convention Center headquarter status," said Duane Rohrbaugh, general manager of Wyndham Palm Springs.
The renovation is set to begin in May and finish in December 2009.
While already established hotels plan renovations and gear up for the future, a new hotel plans to open its doors.
The 180-room Ace Hotel & Swim Club will debut in January and feature a spa, two pools, a restaurant and bar, event space, and offbeat details like tamale carts and edible landscaping.
The hotel is being built on the foundation of a 1965 Westward Ho Hotel. The property's original elements, including terrazzo floors and a rare deep saltwater pool, are being preserved and restored, according to hotel officials. The midcentury modern- and bohemian-style hotel will also feature fuel cells and solar power.
"This is an exciting time for Palm Springs," Ginther said. "Multimillion-dollar hotel renovations are completed, and a new hotel property is being built."
