Orange County has long been the stepsister to Los Angeles in the visitor market, but when it comes to high-end beachfront resorts, OC may be taking the lead.

Construction of luxury lodgings is proceeding at a furious pace along the OC coast, where resort hotels are sprouting like weeds. And just as Disney�s Grand Californian raised the bar for Anaheim-area hotels, the new resorts are likely to do the same for coastal lodgings.

With projects like the St. Regis in Dana Point, Treasure Island in Laguna Beach and the Hyatt Grand Coast Resort in Huntington Beach, coastal OC is poised to take advantage of a luxury hotel segment that many observers believe is almost recession-proof. 

Add in Marriott�s Newport Coast Villas�a vacation ownership resort�and the upcoming 131-room hotel at the Balboa Bay Club, and OC arguably could become the Riviera of the Southern California coastline.

�Even I�m surprised we have three luxury and first-class hotels under construction right now,� said Don Wise, president and CEO of Wise Hotel Investments in Corona del Mar. 

Wise said the projects�which total about 1,200 rooms�probably will take some time to establish themselves in the current market.

�Can they all carve out their market share? Of course. But it will take some time, especially when you overlay the economy and the volume of rooms coming on line,� he said.

Nevertheless, studies show the luxury segment of the hotel market�into which at least the St. Regis and Treasure Island will fall�is likely to remain strong in the foreseeable future. According to the Ernst & Young 2001 National Lodging Forecast, demand in the luxury segment has grown every year since 1997. And average daily rates have trended upward, as has revenue per room. Much the same can be said for the first-class sector.

Jeff Dallas, Western region hospitality practice leader for Ernst & Young in Los Angeles, said he expects there to be continued �significant demand� for high-end resorts, though he said it likely will be mitigated by the economic slowdown.

�The stress will probably be more on the corporate group side,� he said. �There�s still a high level of demand for the individual business traveler and the leisure segment.�

Given that, it�s worth watching what happens as coastal OC transforms itself into a mainland Hawaii.

St. Regis Monarch Beach, Dana Point

The newest crown jewel, the St. Regis Resort, is being developed by Makar Properties LLC, an offshoot of Capital Pacific Holdings created to focus on hospitality and commercial projects. 

The St. Regis sits on 200 acres in Dana Point, across from the Ritz-Carlton Laguna Niguel, and overlooks the Monarch Beach Golf Club. 

The 400-room resort hotel, slated to open in August, is designed in a Mediterranean style that incorporates special touches often reserved for residential projects. 

Italian marble is being used throughout; Tuscan artifacts will be tucked into alcoves in the main rotunda, and specially commissioned murals will adorn the walls. The entire resort takes advantage of natural light and sweeping ocean views.

At the north end of the building will be a 30,000-square-foot spa and fitness center with 27 treatment rooms (some with fireplaces), a yoga room, skylights, a lap pool and an exercise area with personal TVs and e-mail access. Guests also will be able to have outdoor massages.

The south end will hold 30,000 square feet of function space equipped for teleconferencing, video conferencing, satellite broadcasts and special lighting. Indoor and outdoor speakers can be connected so guests can enjoy the pool or gardens while tuning in to a presentation inside. 

A gourmet shop and espresso bar are planned off the central rotunda where guests will be able to shop or enjoy a snack on an outdoor terrace. There will be a 3,000-square-foot ocean-view wine room, ready for private-party wine tastings, and a four-star seafood eatery, Aqua, with a private dining room. 

Guest rooms will feature amenities ranging from 24-hour butler service to Web TV and a CD and DVD library. Rooms will have custom furniture (with rounded features for a �homey� feeling) and Napa Valley art to carry through the wine country theme. 

And there�s the golf course outside the front door�where sand in the current bunkers will be replaced with crushed marble--plus a path to a private beach club.

Nightly rates a will run from $355 for a regular room in the off-peak season to more than $4,500 for the presidential suite.

The resort recently opened a job center in Dana Point and last week was hosting a job fair at Seven Degrees Gallery in Laguna Beach. When fully staffed, the St. Regis will have about 600 employees.

Treasure Island, Laguna Beach

Developer Athens Group of Phoenix is building a 274-room hotel on a parcel that also will have 14 estate-size lots and 14 condominiums. The property sits on a coastal bluff formerly occupied by a mobile home park. A public-access park area is part of the mix. The project, expected to open late next year, has an estimated development cost in excess of $100 million.

The resort, which will be operated by Marriott International, has not yet been named. Though Marriott executives are said to want a top-of-the-line brand for the property, the proximity of the Ritz-Carlton Laguna Niguel likely rules out that option. Design changes that might be needed to brand it with Marriott�s new Bulgari concept would necessitate new city approval, which effectively rules out that option as well. 

Meanwhile, residents continue to refer to the development by its previous name of Treasure Island.

Hyatt Regency Grand Coast Resort, Huntington Beach

After numerous delays, the expansion of the Hilton Waterfront property in Huntington Beach is under way. Last month, the Hyatt Corp. and Robert Mayer Corp., Newport Beach, secured joint-venture funding to build a resort overlooking the ocean next to the Hilton Waterfront in Huntington Beach. As a result, the Hilton Waterfront will change its name to Hilton Grand Coast & Waterfront Beach Resorts.

The expansion will include a 519-room Hyatt Regency hotel that is expected to be completed in September 2002. The resort will have two restaurants, a retail plaza and 52,000 square feet of indoor meeting space, part of which will be a 20,000-square-foot ballroom. Most of the meeting space will be in a separate conference center on the grounds.

To capitalize on the popularity of spas, the resort plan includes a 20,000-square-foot spa specializing in treatments and preparations indigenous to Pacific island cultures. 

Resort guests also will have direct access to the beach via a pedestrian bridge.

Other Projects

Though not a hotel in the traditional sense, the Marriott Newport Coast Villas�a vacation ownership resort�is well into construction of phases two and three. Phase one sold out in less than a year, according to Regional Vice President Rick Owen, and sales of the other phases are brisk.

�The concept makes more sense in a tight economy,� Owen said. 

He said people looking for vacation homes decide that it makes sense to buy only what they will use rather than purchase a second home that will sit vacant for much of the year. And the average cost of vacation club ownership at the Villas is $23,000�considerably lower than the price of a second home.
Owen said there has been a lot of interest from both individuals and companies. Fluor Corp., Aliso Viejo, and California Bank & Trust have purchased units to use for company incentive programs or as an additional employee benefit. Other markets where interest has been heavy have been Arizona, Northern California and Japan.

The resort has 50 units completed; another 19 will be ready shortly. Ninety-five percent have ocean views. 

The complex includes a Marriott-operated spa that is open to the public, and a community room and theater available to local groups. Tennis courts will be added next year; an ocean-view pool is open.

Meanwhile, in Newport Beach, the private Balboa Bay Club is in the midst of a $55 million renovation that will include a new private clubhouse with 28 guest rooms, a 131-room resort hotel open to the public and a new 7,500-square-foot ballroom that will seat more than 500 guests.

�We�re already getting calls about it,� said club president and COO Henry Schielein of the ballroom.

The clubhouse is under construction and will open this fall; the hotel is expected to open in early 2003.

And in Huntington Beach, Makar Properties is in environmental review on a proposed project on a 31-acre parcel on Pacific Coast Highway that could include two luxury hotels, along with homes, offices and retail space. 
The transformation of OC�s coastline hasn�t been lost on existing lodgings, either. 

The Laguna Cliffs Marriott, which overlooks Dana Point Harbor, just completed a $7.5 million renovation that included room upgrades featuring high-speed Internet access and laptop-size in-room safes. Meeting space will be remodeled in August. General Manager Jeroen Gerrese said the renovations are part of a three-prong plan to reposition the resort. The hotel is targeting the small-meetings market, has added a Kids Club to help attract families and is offering weekend getaway packages targeted to locals as well as visitors. Next year, a spa will be added.

The Ritz-Carlton Laguna Niguel is OC�s highest-profile resort. But recent activity has caused it to beef up its marketing efforts, too. The Ritz has added a Ritz Kids program for children ages 5 through 12, is promoting its restaurants to local business and is offering weekend golf packages.

And the Surf & Sand in Laguna Beach is building a spa in what was formerly retail space. That full-service spa, which will include nine treatment rooms and food service from Splashes restaurant, is scheduled to open this summer.
On the other hand, the Four Seasons in Newport Beach remains unfazed by all the development.

�New product always gets all the attention,� said Carrie Olson, marketing director at the Four Seasons. Olson said the Four Seasons as a brand relies on the service it provides to cultivate repeat customers.

�That takes years to develop,� she said. 

Still, she said, hotels can�t rest on their laurels.

�You always have to be forward-thinking,� she said.
 

Sandi Cain is copy editor and a staff reporter covering hospitality,tourism, travel and sports. Cain holds bachelor�s and master�s degrees in education from Kent State University in Ohio, where she majored in social studies. A former high school teacher, she has written for niche-market sports publications in the U.S., England and Australia and formerly worked in both the printing and high-tech industries. A Cleveland, Ohio native, Cain hasbeen a resident of Laguna Beach since the late �70s. She enjoys travel, gardening, reading and spoiling her three cats.