Alan Fuerstman founded Montage Hotels & Resorts in 2002 with a goal of using his experience at Las Vegas' Bellagio, ITT Sheraton (now Starwood Hotels & Resorts) and Marriott International to create an ultraluxury brand. Through a combination of design and global economics, Fuerstman has kept the company small but highly regarded. It has three properties: It opened the Montage Laguna Beach in 2003, the Montage Beverly Hills in 2008 and Utah's Montage Deer Valley in 2010. Fuerstman is also spearheading the company's Montage Memory Makers Contest, which will award five $10,000 college scholarships to kids who best give back to their communities. Fuerstman spoke with hotels editor Danny King.
Q: How's business?
A: It's going great. Last year was maybe the best year we ever had. In Laguna Beach, we're doing better than pre-recession. Beverly Hills is more in a ramp-up mode. We typically figure that it takes anywhere between three and five years for a new Montage property to stabilize, but we opened Beverly Hills in 2008, so that was much more of a challenge. Occupancy in that market had been in the 80s, and it dropped into the 40s, and we opened in the midst of that, so we're a year or two away from being fully stabilized.
Q: What do you mean by fully stabilized?
A: For Beverly Hills, the high-70s to low-80s for occupancy with rates at about $700 on average.
Q: You'd mentioned in 2011 that you could see a Montage opening in China. Is that still the case, and if not, what's in store for Montage expansion?
A: We're still in discussions in China, but it's taken longer than I had imagined, so I wouldn't say it's imminent. We're much further along and closer to announcing on the East Coast in the U.S. Los Cabos is picking up again -- we'd stopped that process, and now we're fully engaged. And we hope to see something emerging in the Bahamas in the latter part of this year. But the East Coast will be the first thing to be announced, and we're aggressively looking in New York. That's a market we'd love to be in.
Q: Some of the larger hoteliers such as Hilton and Marriott have stated their intentions to broaden their reach in the luxury sector. Is that a point of concern for a small company like yours that's looking to expand?
A: Ultraluxury is best served by a highly personalized company. And we're extraordinarily disciplined on where we put the brand. When I started the company, we said we wouldn't compromise by putting hotels in markets where we couldn't get the rate. North of $500 a night is a qualifier.
Q: Your first hotel, in Laguna Beach, is your largest, with 250 rooms. How large can a hotel be and still provide the level of service you hope to provide?
A: I'd say 200 [rooms] on the high end. It wouldn't surprise me to see some of the properties get to less than 100 rooms. I'm less concerned about the number of rooms and more about guest experience. For instance, on a private island in the Bahamas, a beachfront hotel with 40 to 50 keys would be very good for the brand.
Q: What are the hallmarks for ultraluxury hotel service?
A: It's all about graciousness, style of service and customizing the guest experience. It's less about the mortar and bricks, and more about connecting with your guest. There's no mystery that luxury requires much more personal interaction. We run a high ratio of staff to guests; it's above 2-to-1 in terms of staff to rooms. That's high, and it only makes sense if you can get the premium in rates.
Follow Danny King on Twitter @dktravelweekly.