KSL: Little known name behind some well-known hotels

LA QUINTA, Calif. -- Most people probably have never heard of KSL. But everybody knows the companys hotels.

After all, the list of properties that make up the KSL Resorts Collection reads like a whos who of top resorts, with names such as the Arizona Biltmore in Phoenix; the Claremont in Berkeley, Calif.; the Grand Wailea on Maui, and the Hotel Del Coronado in San Diego.

And this collection is an actual collection. We bought and own 100% of these assets, said Arthur Berg, KSLs vice president of sales and marketing.

From the start, Berg said, KSL only was interested in acquiring one-of-a-kind, historical properties that wind up on the market for a number of reasons.

Some are run very well and happen to come up for sale, he said. But many of them have fallen on hard times or end up in the hands of owners that cant keep up with the capital needs or the ongoing, appropriate operational funding and find themselves on the market.

That presents an opportunity for KSL Resorts.

We believe in the long-term value of them, he said, citing La Costa Resort and Spa in Carlsbad, Calif., as a great example.

The process of buying the property took five years.

La Costa opened in 1965. It was the first destination spa-resort in the country. It ushered in a new age and dominated that position for about 15 or 17 years until about the early 1980s. Then the property started to slide, Berg said. 

By the time we bought it, it had fallen off the radar. Knowledgeable travelers knew La Costa was past its heyday. But we believed in the equity and the value of it.

KSL acquired La Costa and invested $140 million renovating the property. That is very typical of what we look for and the money we are willing to put up, Berg said.

According to Berg, KSL Resorts intends to acquire more resorts and has forged a partnership with CNL Hospitality, an Orlando-based real estate investment trust.

We sold the underlying real estate of six resorts to CNL Hospitalities, Berg said. KSL is managing the Grand Wailea, La Quinta Resort & Club, and the Arizona Biltmore for CNL under long-term agreements, typically 30 years.

We still own 100% of La Costa, Berg said. We are in partnership with CNL for the Hotel Del Coronado [KSL owns 30%] and have long-term management agreements.

So moving forward, we now have options. We can go out and buy properties, or we are open to joint ventures with the appropriate partners that share our vision.

In the meantime, KSL is focusing on marketing its resorts to travel agents and consumers.

If a guest or travel agent has a great experience at the Arizona Biltmore, it would stand to reason that when they are thinking of going to California, they would be interested in the Hotel Del Coronado or if they are going to Hawaii, the Grand Wailea, Berg said. But if they dont know they are part of a collection, it will make it that much more difficult for guests to find it and for travel agents to recommend it.

Berg said KSL properties are engaging in cross-marketing to increase awareness of the KSL brand. Along with stepping up advertising, KSL Resorts is developing an automated-recognition program that will acknowledge frequent guests.

The KSL Resorts Collection is online at www.kslresorts.com.

To contact reporter Michael Milligan, send e-mail to [email protected].