Jul. 6, 2007 - HAVANA When university professor Santiago Gonzalez travels the world, the native Spaniard prefers to stay at small hotels, the kind that reflect the local character of the place he's visiting.

In Cuba, he recently checked into the 27-room Hotel Santa Isabel, a former colonial mansion in the heart of Old Havana, complete with an inner courtyard garden and high-ceiling rooms with colonial-style furniture. The deluxe hotel blends in well with the cobblestone streets and leafy plaza out front.

"In big chain hotels, I feel like I'm part of a machine, like a number," said Gonzalez, 52, in the marble-floored lobby of his hotel near a stately courtyard fountain. "Here, it's a different atmosphere, more humane."

As Cuba strives to regain momentum in its stumbling tourism industry, the communist-run nation is looking to lure more guests like Gonzalez. It aims to build 50 more boutique hotels in historic areas and city centers to diversify from larger hotels common on the island's beachfronts, mainly all-inclusive resorts in tourist enclaves.

Many employees of small hotels back the boutique push. They say smaller properties allow more personal exchanges with guests, more like family.

"You can really feel like it's your own house," said Marcela Morales, 43, a veteran employee at Hotel Santa Isabel, who rattles off the building's century-plus history from its days as home to the Count of Santovenia to its recent hosting of such guests as former U.S. President Carter, singer Sting and actor Jack Nicholson. "I'm proud to work here."

Tourism experts see promise in the small hotels, a push that will spur more visitors to spread around the island. But they caution that 50 boutique properties won't be enough to energize Cuba's tourism industry, beset with woes from rising prices to weak service.

Even guests at boutique hotels can attest to deficiencies.

British executives Julie Connery, 37, and Richard Foster, 40, said they asked to stay an extra night after a week at the art nouveau-style Hotel Raquel in colonial Havana, but staff said the room rate would double: The new reservation did not come through their travel agency. The couple moved out, disappointed that managers would not accommodate them at the same rate.

"They just haven't bought into customer service," said Foster, who visited Cuba to experience one of the world's last socialist nations and would gladly return. "They're friendly. But whereas in the United Kingdom it seems as if everyone is aspiring to be the CEO, here it's just a job."

Cuba's government is hot on boutique hotels in city centers for several reasons.

For starters, the cash-strapped government need not build new buildings; it can renovate existing ones, often in disrepair today. The government also can more easily run smaller hotels on its own; larger ones tend to require foreign partners, such as Spain's Melia, which charge management fees. Plus, the boutique properties often charge top prices -- $200-plus a night at the Santa Isabel, for instance.

Tourism already ranks as Cuba's top foreign-exchange earner, raking in more than $2 billion a year for the island.

In Havana's colonial area, smaller hotels began sprouting a decade ago, thanks to a plan which reinvests a portion of the area's tourism earnings into restoration. Popular spots include the 52-room Ambos Mundos, where American novelist Ernest Hemingway wrote chapters of For Whom the Bell Tolls; and the 25-room Hotel Florida, a restored colonial mansion on pedestrian-friendly Obispo Street.

Yet reviews on tripadvisor.com highlight problems, too.

An April 27 review of Hotel Florida cited five burned-out light bulbs in the room, "not good for putting on makeup," and decried "the Soviet-era bed, with the springs jabbing my back." While staff were friendly, the San Diego reviewer questioned "value" at the hotel, where prices start at $130 a night rack rate.

Doubts about value are among the reasons that Cuba's visitor tally slipped by about 4 percent last year to 2.2 million, short of government projections of 2.5 million.

Tour operators bemoan the higher cost for the Cuban peso since 2005, when the island government also imposed an extra 10 percent fee on changing U.S. dollars. The new charges often make a Cuban holiday more expensive than the nearby Dominican Republic, tour operators have said.

To stem the slide, Cuba announced plans to spend $185 million by 2010 to upgrade resorts, plus golf courses and marinas.

Doreen Hemlock can be reached at [email protected] or 305-810-5009.

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