Irvine-based Montage Hotels & Resorts is breaking new ground in more ways than one.
The resort developer and operator—best known for its flagship Montage Laguna Beach—put shovel to dirt earlier this month on the $100 million Pendry San Diego, a 317-room hotel in the city’s Gaslamp district.
That pencils out to about $315,000 per room.
The project is the company’s first hotel that won’t carry the Montage name. It’s also new ground from a strategic standpoint, going from the signature style of its resorts to seeking room amid a hospitality industry trend toward targeting younger customers with “luxury lifestyle” boutique properties in city settings.
Rooms at the Pendry are expected to go for about $250 to $300 a night, according to reports, while a stay at a Montage resort can start at more than twice that price.
Chief Executive Alan Fuerstman founded the company in 2002 after stints as vice president of hotel operations at the Bellagio in Las Vegas and president and managing director at The Phoenician Resort in Scottsdale, Ariz.
Expansion
The project in San Diego caps a year of expansion for Montage.
The company had three premium resorts in its portfolio—Laguna Beach (see related story, page 3), Beverly Hills, and Park City, Utah—a year ago.
It will end this year with five after taking over management of the Montage Kapalua Bay in Hawaii this summer and The Inn at Palmetto Bluff in South Carolina in February.
It also has two more on the way, with the Pendry expected to be followed by a Cabo San Lucas resort called Montage Los Cabos—a project that was suspended during the recession and now is back on, according to the company.
Pendry San Diego is scheduled to open in mid-2016, the company said.
“This is a different animal they’re going into,” said Alan Reay, president of Atlas Hospitality Group in Irvine. “Gaslamp is an excellent market, but it’s a different approach and a different hotel.”
The Pendry will have a nightclub, several restaurants and several bars—including one focused on craft beers. There also will be a pool, spa and fitness offerings, along with an 8,600-square-foot ballroom, part of a total planned 22,000 square feet of meeting space, reports said.
The Pendry is part of a hotel boom in downtown San Diego that includes at least five other hotels in development for a total of more than 1,100 rooms.
It will be the first offering under a separate brand run by Fuerstman’s son Michael, according to the company.
Michael Fuerstman said the Pendry brand will aim for an integration of “design and service, a bit of heritage and modern sensibility.”
It also reflects a wider hotel industry effort to attract younger travelers.
‘Luxury Lifestyle’
This month, Hilton Worldwide announced its boutique “luxury lifestyle” brand called Canopy. Loews Hotels Inc. and Best Western International, among others, have similar divisions.
Reay said the Pendry puts Montage Hotels & Resorts in the trend.
“This is a hip new boutique product in an up-and-coming market, and Montage is getting into it,” he said.
Montage opened its Laguna Beach property in 2003.
Montage Beverly Hills followed in 2008 and Montage Deer Valley in Park City, Utah, in 2010. Hawaii and South Carolina joined the stable this year with the San Diego projects and Cabo still to come.
Montage also leased space for a new headquarters in January.
There are about 50 employees working on acquisitions, communications, human resources and finance at the Ada Parkway office in Irvine. They oversee an operation that now has properties on both coasts, dips south to Mexico and across the ocean to Hawaii, and offers upscale beach, ski, nature or urban options.
Much of the company’s growth has come with management deals—some with equity stakes. It often goes in with a development partner.
The San Diego effort is an example—it was planned as a Marriott Renaissance for about 10 years, but after an eminent domain lawsuit and the 2008 recession, the project stalled.
Montage invested with Encinitas-based developer the Robert Green Co. on the Pendry.
