Laguna’s Treasure

After years of anticipation – not to mention controversy – the redevelopment of Laguna’s historic Treasure Island is done.

By Terence Loose

W

hen the Montage Resort and Spa opens in early 2003 on the 30-acre clifftop just south of the residential development of Blue Lagoon and north of Aliso Creek, it will become part of Laguna’s history. The opening will represent a new beginning for one of the most watched-after chunks of the Orange Coast. Though it was a redevelopment project – 268 trailers and mobile homes previously sat on the then mainly asphalt-covered property – this precious acreage, sitting 50 feet above some of Laguna’s most pristine waters, were fought over as passionately as if they held California’s last redwood. As a result, the Montage project, which includes a 262-room world-class hotel with a 20,000-square-foot spa, gourmet restaurant and public park, along with 14 condominiums and 14 custom estate lots, is a long way from what developers envisioned when the last trailer pulled out in 1997. And by most accounts, on either side of the negotiating table, that’s a good thing.

The spot known to locals as Treasure Island has been privately owned since Hubbard Goff first homesteaded the property in the late 1800s. And though legend has it that the French pirate captain Happolyte Bouchard buried chests of gold and jewels on its shore in 1818, the place didn’t get its name until the movie Treasure Island, based on Robert Louis Stevenson’s classic adventure novel, was filmed there in 1934. By then it was already a trailer park.

In 1986, a newly formed group called Treasure Island Associates bought the property for $43 million with hopes to redevelop the parcel into a luxury residential area. However, the city of Laguna Beach, whose citizens are not known for their warmth toward developers, had other ideas. If Treasure Island’s land use was to be changed, they wanted a project that opened up the area. The last thing they wanted was another exclusive guard-gated project that closed out the public (ironically, the existing trailer park did exactly that). City planners also wanted a hotel, badly. They argued for bed tax revenue, for public meeting spaces, for restaurants open to the public, for walkways, maybe even a park.

By 1996, they had it, sort of. Under the leadership of TIA’s majority landowner Richard Hall, a Laguna Beach resident himself, plans were drawn up for a 300-bed, five-star hotel (a concession to the city) and 268 homes and home sites to replace the 268 trailers. The residential portion would include a “millionaire-mile” portion of the blufftop boasting 27 ocean-view lots of 5,000-square-feet each. In back of those would be 72 beach cottages, and 169 condominiums would rest closer to Coast Highway. And though the plan included increased public access and a public walkway to the beach, Lagunans were not impressed. In fact, some were enraged.

Laguna Beach councilmen called the plan “excessive” and “much too aggressive.” Councilman Wayne Baglin was particularly disheartened at the time, saying, “They chose to come in with the maximum they could possibly get and in so doing lost a lot of public opinion. They’re starting like any other developer, and people are just tired of that.” And when Lagunans dig in, they dig deep.

So it’s no wonder nothing happened for years, except a lot of changes, including that of title of the land. But the trend was clear: hotel good, massive residential bad. And in Laguna, if nothing else is true, it’s that you don’t change Laguna, Laguna changes you.

Which is why the hotel that was only a sparkle in a councilman’s eye less than a decade ago is now the main focus of the project. Indeed, the Montage Resort and Spa is being touted as the crown jewel of Southern California’s “Gold Coast.” Strong words spoken in the shadow of the Ritz Carlton and the St. Regis.

But the owners of the Montage, which was begun by Marriott International before being bought in June, 2002 by the newly formed Montage Hotels and Resorts, promise something entirely different. Most dramatically, the Montage’s architecture is far from ostentatious, embracing a Craftsman style that pays homage to turn-of-the-century (1900, that is) simplicity and warmth through extensive use of wood, stone, wainscotting, and crown moldings. “The project is a terrific size. Not too big, not too small,” says Alan Fuerstman, Montage Hotels and Resorts founder, president and CEO. “The property has a tremendous sense of place. It amplifies its surroundings and is indigenous to the area. We want it to evoke images of beach bungalows and have an intimate, private estate feel.”

A large portion of that intimacy derives from the overcoming of some of the property’s natural challenges, as well as from the city’s demands to the hotel’s developer, The Athens Group, and its chosen architectural firm, Hill Glazier Architects. The city didn’t want a high-rise to block ocean views – something taboo in Laguna – but with the relatively small acreage, a sprawling resort was also out of the question. The result was a tiered design, which is very low-pro from the highway but is in fact five stories. An added benefit: Every one of the 262 rooms has an ocean view and private balcony.

The rooms themselves include 51 suites ranging from 800 to 2,800 square feet, and 37 beach bungalow-style rooms. All will have dark wood furnishings, period light fixtures, muted color schemes and authentic artwork by noted California artists.

In the center of all this is a grand mosaic tile pool and patio area, with private cabanas for rent. Further on, resting on a natural point, will be Studio restaurant, which will feature panoramic views and Mediterranean-style dishes by noted award-winning chef James Boyce. Finally, there is the 20,000-square-foot indoor/outdoor oceanfront spa, featuring everything from herbal and hydrotherapy body treatments to aerobics and weight training to beachside yoga and Tai Chi.

Perhaps this is why Fuerstman and his new company felt confident enough to pay a whopping $190 million for the project (the price includes the residential component as well), even in a post-9/11 hotel slowdown that saw occupancy rates decline by 25 percent.

In fact, the 46-year-old Fuerstman is looking downright bullish. It’s of course no secret that Orange County has traditionally been more insulated than most areas of the country when it came to recessions, business and housing slowdowns. And when it comes to hotels, Orange County seems to also hold an advantage: one study shows 60% of Southern California’s hotel guests coming from Southern California itself, for relaxing weekend getaways, weddings, spa facilities, and other pampering. “We expect the Southern Californian market to be very strong,” says Fuerstman. “That’s one of the great advantages of this destination. It’s a place where people can easily drive to as well as fly to [unlike, say, Hawaii]. So even in difficult times when air travel is down [like now] the drive-to destinations tend to hold up.”

When the public does find their way to Montage, Fuerstman, who has over 20 years experience in the hotel business, will be ready. He knows a little something about making guests feel pampered. He started his career in high school, working as a doorman for a Marriott in his hometown of Saddlebrook, New Jersey, continued working summers all through college and finally went to Marriott’s management training program. He worked his way up quickly, culminating in his opening Marriott’s flagship property, Marriott Desert Springs Resort and Spa. Other highlights included his overseeing the Mobil Five-Star Phoenician in Scottsdale, Arizona and, most recently, serving as opening vice president of hotel operations at the Bellagio Las Vegas.

But, as Fuerstman puts it, he had “an entrepreneurial urge,” which is where the Montage comes in. Fuerstman founded Montage Hotels and Resorts in January of 2002 and within months had sealed the deal to make the former Treasure Island property its flagship offering. Fuerstman says he wasn’t planning to purchase a project so far along, but when he and his team visited the then-Laguna Beach Colony Hotel, they were hooked.

His focus became how to make a great design even better. One theme his group embraced was to bring the outside in, replacing large glass windows in the lobby lounge and casual restaurant, named The Loft, with glass doors, so the breezes, sounds and scents of the Pacific could be felt by guests. Also, a concerted effort – and investment – has been put forth to fill the hotel with “a museum-quality collection of fine art, sculpture and ceramics inspired by the turn-of-the-century arts and crafts movement.” According to Montage representatives, these will include rare paintings by such plein-air notables as William Wendt, Edgar Payne and Jean Mannheim, as well as new works commissioned by local artists. “It’s very important for our company that we stay true to the artistic heritage of the community and its artistic roots. We want this to be a place where art is recognized and appreciated,” says Fuerstman.

While most will only have the chance to visit the grounds of the Montage, a lucky – and monied – few will enjoy it full time. No more than 28 to be exact, for this is the number of residential units that will be offered – a far cry from the originally slated 268.

Called the Laguna Beach Colony, the residential enclave will consist of 14 3,000-square-foot craftsman-style condominiums, or villas, all with ocean views, and 14 custom home sites from 12,000 to 15,000 square feet. Seven will be oceanfront; all will have ocean views. The architectural guidelines for the future estates specify craftsman-style design and single story construction – Laguna view issues are alive and well, even in new developments.

While the setting is certainly enough to sell the project, it’s the lifestyle that is being promoted. Residents of the Colony will enjoy full use of the Montage, from the luxurious pool, children’s pool, spa, workout facility, hotel signing privileges, dry cleaning, and more. Also, there will be a special residential concierge. “That’s where the thrust is different,” says Strada Properties President Steve High, who is representing Laguna Colony. “Monied people want to have the resort lifestyle.” Himself a Laguna resident, High feels that the Laguna Colony project is one of the most exciting pieces of real estate to come to market in the last 20 years. “You have a big sandy beach, three intimate coves, perfect scenery, a full service resort with beach services…what more could you want?” he asks. Perhaps this is why his interest list is now almost 600 names long – some of them known the world over. Soon, they’ll vie for the right to pay an expected $4.5 million to $7 million for a custom lot and $2.5 million to $3.5 million for a villa (prices were not set at press time). Both the villas, which will be finished by late March, and the custom lots will go on the market in mid-January.

This residential element, says Fuerstman, is one way his group is able to build a first-class hotel. “The residential element makes it possible to purchase the property. We get money coming back in right away,” he says. In fact, in the luxury market, mixed-use projects are routine now. For instance, says Fuerstman, in one of their Beverly Hills high-rise hotels, the top few floors are penthouse condominiums. And it’s that part that makes the project fiscally sound. “The cost of luxury has risen and making the deals make sense often requires a residential component,” he says.

The key, of course, is how well that residential part, or more to the point, how well the resort component, is integrated. And, by extension, how well it is integrated with the community. “A great hotel invariably becomes an integral part of the community, and we have a responsibility to do that here,” says Fuerstman. “We have to stay focused on our own backyard as much as the national and international markets. It’s an important aspect of the business.” And lest he forget, Laguna is always there to remind him. þ

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