Montage International founder Alan Fuerstman is the kind of entrepreneur that isn’t looking to reinvent the wheel, but rather improve its foundation.
It’s a mentality that’s helped launch his career and has come in handy in the 20 years since.
The local tourism veteran got his start when he noticed a gap in the luxury hotel industry, and sought to improve it, creating the flagship Montage Laguna Beach in 2003.
He’s been through three significant downturns as head of the resort company, which counts seven properties, with seven more on the way.
Even as he now faces what he calls “the most severe” downturn of them all, Fuerstman is still spotting opportunities in the market.
“It’s all about finding a better way to do things, and maintain creativity,” Fuerstman told the Business Journal. “Sometimes, the best opportunities happen in contradictory times.”
Fuerstman is one of five honorees chosen in this year’s Business Journal Excellence in Entrepreneurship awards (see stories on the other winners, pages 1, 4, and 11).
Entrepreneurial Spirit
After several decades in the hospitality industry, Fuerstman set off to start his own hotel venture in the early 2000s—in the wake of 9/11—with the goal of creating a new brand that rethought the way guests perceived luxury.
“My opinion was that traditional luxury was going out of vogue,” Fuerstman said. “It was too scripted, too stuffy, and was in need of a more gracious and humble approach that would maintain craftsmanship and attention to detail without the pretentiousness.”
Though the timing was rough for the tourism market, it was fortuitous to Fuerstman, who was hopeful for opportunistic deals.
He was coming off a hospitality career that started in New Jersey, where Fuerstman took his first gig as a bellman in high school, and led to Las Vegas, where he helped open the Bellagio hotel in 1998.
A few years later, the bug bit.
“I developed an entrepreneurial spirit, and decided it was time to create what I thought was needed in the industry,” Fuerstman said.
It was 2002, a troubled time for the industry, but for Fuerstman, the timing was right. He put together an investment team and settled on a site that would become the company’s flagship property in Laguna Beach.
The 30-acre site was under development at the time, led by a team including Marriott International, which was building a master-planned resort including the Laguna Beach Colony, to be branded under the Ritz-Carlton flag.
“When I saw the site, I knew it would be the ideal place to launch our brand,” Fuerstman said.
Service, Style
The firm implemented several changes to make the property fit the new Montage concept, with the largest emphasis placed on “building the culture of the company.”
“We wanted to have a specific style of service, a focus on the spa, food and beverage, and anything that would help differentiate us from the other competition in the area,” Fuerstman said.
Competition indeed, with the Ritz-Carlton, St. Regis and Four Seasons all in the Orange County market at the time.
“What better way to start, to compete with such well-known, strong brands?”
Fuerstman and company opened the 250-room Montage Laguna Beach in February 2003, less than a year after they acquired the site, which quickly generated interest from locals and visitors.
“We recruited incredible talent and opened successfully,” Fuerstman said. “We had developed this concept with the next generation of luxe travelers in mind, but we found that older generations responded positively too, with pent-up demand for a new kind of luxury hotel.
“We quickly became a leading performing resort in the market.”
Pendry Growth
Expansion was inevitable, with Fuerstman already working on another opening, with the Montage Beverly Hills debuting a few years after Montage Laguna Beach opened.
“We started the company with the idea of building a strong brand across several locations, but always prioritizing quality over quantity,” Fuerstman said.
The company has seven properties globally, with future expansion centered on a spinoff boutique brand: Pendry.
Fuerstman’s son, Michael Fuerstman, heads that effort, which is more design forward, while still incorporating the hands-on service that Montage was built on, with Pendry skewing a bit younger in terms of market share.
“There’s tremendous growth on the horizon with both Pendry and Montage, with plans to open another six or seven hotels in the next year and a half,” Fuerstman said.
Moving forward, Pendry growth is expected to outpace that of the Montage, with three Pendry’s opening to each Montage.
“More markets can support the Pendry brand,” Fuerstman said.
COVID Concerns
Six months after the coronavirus pandemic hit and forced hotel closures and staff furloughs, Montage is seeing demand pick back up, with all but one hotel in Maui open.
In Laguna Beach, weekend business is strong, with demand stemming from locals and nearby visitors. The Montage Palmetto Bluff in South Carolina is benefitting from pent-up demand from locals unable to travel internationally.
“We have seen a much more positive outcome as of late,” said Fuerstman, adding that the company is “spending an incredible amount of energy on the safety and wellness of associates and guests to make sure we are operating in the safest fashion.”
Industry watchers have forecasted sustained headwinds to the tourism sector as financing partners back out of new hotel deals and construction pipelines drop.
Montage’s pipeline is not under threat, Fuerstman notes, with two hotels—Montage Healdsburg in Sonoma and Pendry West Hollywood—on track to open this year. He’s opportunistic on future deals, too.
“I think what you’ll see is highly differentiated products will continue to be funded,” Fuerstman said.
“Also, some opportunities are likely to come about from distressed properties. That could represent a new source of growth for Montage.”
