Opening Adds to Competition in South
Orange County California
|By Sandi Cain
Staff Reporter Orange County Business Journal
When Disney’s Grand Californian Hotel opened in Anaheim last January, it set a new standard for resort hotels in North Orange County that has helped boost room rates in that market. But South County, with only 6% of the county’s meeting space in major hotels, was hard-pressed to lure large groups.
The recent opening of the new St. Regis Resort in Dana Point, however,
has expanded South County’s offerings and focused attention on the area,
promising to raise the bar for coastal lodgings the way the Grand Californian
did in Anaheim.
Indeed, the addition of St. Regis’ 30,000 square feet of indoor function space will boost South OC’s share of the county’s total indoor space to 9.6%. The resort also has 60,000 square feet of outdoor function space well-suited to social events and receptions.
St. Regis is targeting the leisure weekend market, small conferences, social events, fund-raisers and political events.
Don Wise, president and chief executive of Wise Hotels, said the Ritz-Carlton
Laguna Niguel—directly across Pacific Coast Highway from St. Regis--is
likely to feel the heat of competition when it comes to social business.
The Surfrider Foundation’s Waterman’s Ball was the first social event at the hotel, bringing about 900 guests to the new resort on its first weekend of operation.
Officials from neighboring Laguna Cliffs Marriott and the Ritz Carlton, however, both publicly and privately tout the synergy that St. Regis adds to the mix in Dana Point.
“St. Regis will be a major player in the marketplace,” said George Munz, director of marketing at the Ritz-Carlton.
“What we had here before was one hotel,” Munz said. “One hotel can’t
promote the destination. Three hotels can. We’ll get our due reward.”
Some OC players think the tourism boost will be a natural.
Chapman University president Jim Doti said the resort is likely to broaden OC’s tourist base and “give it a certain panache that will attract a different type of tourist clientele.”
Both Gerrese and Munz believe there’s enough demand in South Orange County to keep St. Regis, the Ritz and the Marriott busy. Muntz pointed to companies like Ford and Lincoln, which have moved into the area in recent years, as the kinds of companies that have gone outside the county for meetings, but now have more options here.
There’s no question that automakers were on the minds of the St. Regis designers—its main 12,000-square-foot ballroom has a roll-up door that allows a vehicle to be driven directly into the ballroom, and making it more attractive for automotive product launches. Automaker Volvo already has an event on the books.
“We want (local business) to stay home and have events,” Munz said.
“The St. Regis is just another addition to the equation,” said Director of Marketing Carrie Olson. “We haven’t lost any social business to them yet,” she said.
Neither has Newport’s Sutton Place Hotel, according to Mitchell.
Olson said the Four Seasons relies on providing exceptional service to bring repeat business—something that takes time to build. Plus, a good chunk of the Four Seasons business is corporate.
“There’s not as much commercial demand in South County,” Branigan said. “Four Seasons is more corporate. St. Regis will be more meetings dependent.”
And Anaheim — the heart of Orange County’s convention business and the home of its convention center — is unlikely to even blink in the face of new competition from points south.
“Anaheim is a different beast,” said Kathryn Jurgensen, principal of Premier Meetings in Irvine, a destination management company that books corporate and incentive groups into the area.
That sentiment is echoed throughout a meetings industry that has been battered by the economic downturn in places like San Francisco, Washington, D.C. and New York.
Indeed, while the rest of the country is feeling the pinch of cutbacks in business travel, hotel occupancy in the Anaheim area is up 2.2% year-to-date — one of only three markets nationwide that has not seen a decline, according to data from Smith Travel Research. Room rates, too, are up - 7.4% year-to-date — and convention bookings are still strong.
“The pace and number of meetings is about 65,000 rooms ahead of last year,” said Charles Ahlers, president of the Anaheim/Orange County Visitor & Convention Bureau.
Meanwhile, South OC has seen its rates jump about 10% this year, while occupancy has dropped by about the same amount, according to Los Angeles-based PKF Consulting.
Of course, corporate meeting planners facing cutbacks might hesitate
to book meetings at luxurious properties like the St. Regis, where room
rates start in the mid-$300s (and that’s during off-peak season), but Director
of Sales Brian Dye said bookings have been brisk. Groups from companies
like Neutragena, Credit Suisse Group, Callaway Golf Co. and Allstate Insurance
are already on the books; even a group from the Teamsters Union will meet
there in the fall.
Prefunction areas are more than just a hallway - they are alcoves where attendees can gather without disrupting other foot traffic. There is high speed wireless Internet access throughout and skyhooks drop from the ceiling to address a variety of power and lighting needs. A circular stairway, highlighted by a Murano glass chandelier, winds around the rotunda and leads to the main ballroom and wedding lawn. And while meeting planners sometimes fret that a too-enticing outdoor setting could detract from business, that concern, too, is addressed at the St. Regis. Any inside speakers can be connected to any set of outdoor speakers, enabling a group to listen to a presentation while relaxing on the terrace or at the pool.
Various outdoor lawns and gazebos, surrounded by gardens and fountains, can be used for a variety of private events or concerts. Private wine-tasting sessions can be arranged at the Wine Cellar and a private dining room is available at the hotel’s signature restaurant, Aqua.
In addition, the 14,000-square-foot clubhouse at Monarch Links Golf Course is available for themed evening events, and a professional wedding coordinator is on site.
Of course, St. Regis is just the first of several coastal resorts coming on line in the next couple of years that industry insiders say will help boost OC’s image as a destination resort.
Just a few miles north in Laguna Beach, Phoenix-based Athens Group is building a 274-room resort still to be named by manager Marriott International. That resort will have about 10,000 square feet of meeting space — enough to host events of up to 300 people. In fact, that design element was of prime importance to the city of Laguna Beach, which was all too keenly aware of the number of local groups that have held events outside the city. At present, the Surf & Sand has the most meeting space in the city, with 8,787 square feet. And the venerable Hotel Laguna at Main Beach, offers only 6,000.
Less likely to compete with resorts in Dana Point or Laguna Beach, but still adding to coastal options is the private Balboa Bay Club, which is in the midst of a $55 million renovation. That waterfront project will include a 131-room resort hotel open to the public and feature a 7,500-square-foot ballroom that will accommodate up to 500 guests. The hotel is expected to open in early 2003.
COO Henry Schielein said the ballroom — just steps from Newport Bay, will be a unique feature not found elsewhere on the county’s coast.
“We’re already getting calls about it,” he said.
And the Hyatt Corp. and Robert Mayer Corp., Newport Beach, last spring secured joint-venture funding to build a resort next to the existing Hilton Waterfront in Huntington Beach. That expansion will include up to 52,000 square feet of indoor meeting space, much of which will be in a separate conference center.
But South County projects like the St. Regis are likely to be the best positioned for both corporate and leisure business in the future.
“The continued growth of Orange County in the long term is really being pulled by South County, and that’s where (St. Regis) is,” said Steve Duffy, a partner in the OC office of Ernst & Young.
But despite unbridled enthusiasm for the St. Regis and all it represents to South OC, the unpredictable economy could still take a toll.
“It will take time to get off to good start,” Don Wise said. “And if
it turns into a price war (between the Dana Point resorts), the Laguna
Cliffs Marriott and others could take a hit.”
Orange County Business Journal
|Also See||Orange County Hotels Beating the Bushes in Search of New Business / Sandi Cain / August 2001|
|The Orange Riviera - New Luxury Hotels and Renovation Projects Transforming OC’s Coast / Sandi Cain / May 2001|
|Ayres Hotel Group Expands, Rebrands / Sandi Cain / March 2001|
|Orange County’s Hoteliers Relieved as Anaheim Convention Center Expansion Boosted Occupancy and Rates During Past Year / Sandi Cain / May 2001|
|Indomitable Disney / Bad News Doesn’t Tarnish the Mouse; Slowing Economy Another Matter / / Feb 2001|
|Orange County Hotels Poised for Meetings Growth; Newcomers Help Bolster Total Space; Disneyland Hotel Still No. 1 / Sandi Cain / Jan 2001|