Every year, the Coachella Valley Music and Arts Festival and its sister country music event bring hundreds of thousands of revelers to the desert, far from the trendy restaurants, hotels and other attractions in a resurgent Palm Springs.
Now, a developer group with a celebrity pedigree is building a sprawling 35-acre resort featuring a hip hotel that will not only cater to the hugely popular festivals but serve as a recreation attraction in its own right — and help develop the east end of the Coachella Valley into more of a year-round destination.
The resort is close to the Empire Polo Club, where Coachella and the Stagecoach Festival are held, but will have its own 11-acre, grass-covered “playground” to host music events, wellness retreats and corporate or other private events, said Steve Bram of George Smith Partners, who arranged construction financing.
The developers, he said, include Los Angeles real estate investor Stuart Rubin and L.A. entertainment lawyer Gary Stiffelman, who has represented Lady Gaga, Eminem and Justin Timberlake, according to Bloomberg.
The centerpiece of the resort will be a 10,000-square-foot Las Vegas-style party pool filled with chilled saltwater so it doesn’t overheat on hot days. Flanking it will be two- four- and six-bedroom casitas that have shared living rooms and social areas for entertaining but private entrances and bathrooms.
The pool will have a DJ stage and a catwalk in the middle where models may strut, he said, with “a big cocktail lounge attached.”
Among the Indigo’s features will be a spa, a gym and a yoga studio. There will also be a restaurant, a general store and a coffee shop. A marijuana dispensary recently opened adjacent to the hotel.
The resort’s public buildings, including its conference space, were designed to evoke Quonset huts, Bram said, the humble semicircular structures mass-produced during World War II that were once common in the desert.
"The conceptual design of the hotel is so out of the box and so unique that the lender just fell in love,” said Bram, who declined to name the bank.
The 250 guest rooms will operate under the flag of the Hotel Indigo, a chic “lifestyle” brand of United Kingdom-based InterContinental Hotels Group. A Hotel Indigo recently opened at downtown L.A.’s $1-billion Metropolis residential project.
Work on the hotel began this year and is expected to be completed in the fall, in time for the desert’s high season. Its estimated price tag is $45 million.
The arrival of such an upscale resort where guests can come for business retreats or unwind for several days “has been a long time coming” to Coachella, said Gabriel Martin, the city’s economic development manager.
It will also be the only major hotel actually in Coachella — other nearby inns such as the Indian Palms Country Club & Resort are in Indio.
The hotel will provide new revenue and employment for the working-class city of 48,000, Martin said. Coachella supported the project financially by agreeing to a 50-50 split in the hotel’s bed taxes with the owners for 20 years or as much as $25 million, whichever occurs first.
The city is also allowing the resort to hold events until 4 a.m. after requiring the developers to build a 12-foot-high wall to shield its concert space from neighbors, Bram said.
Martin hopes more resorts will join the Indigo in Coachella.
“Right now we’re trying to capitalize on the market that is out there,” he said. “We are really looking for potential development that can have a similar impact.”
The large-scale resort project is a sign of extended economic growth in the Riverside County valley, which includes such population centers as Palm Springs, Rancho Mirage and Palm Desert. The valley has a deep tourism and convention base, offering 125 golf courses and more than 600 tennis courts.
At the beginning of the decade, the valley was still suffering an economic hangover from the Great Recession’s mortgage crisis, but has recovered in recent years with help from tourists and new hotels to serve them, said Joe Wallace, chief executive of Coachella Valley Economic Partnership trade group.
“There has been a glut of hotel-building going on across the valley,” he said.
Much of that has been in Palm Springs, which has had a resurgence in the last decade among visitors too young to remember when Frank Sinatra and other celebrities of his day made the desert hip and helped create the mid-century architectural vibe it is known for.
Palm Springs has about 44,000 residents, but more than 2 million travelers a year pass through its airport and millions more arrive by car from around Southern California, Wallace said.
Some of them are heading to the music festivals at the opposite end of the valley that have grown larger year by year, filling hotels, restaurants and bars, and giving a lift to retailers, he said.
The Coachella Valley Music and Arts Festival drew about 100,000 people each of its two weekends in April — pushing attendees to spend lavishly if they want to stay pretty much anywhere in the valley.
Hoteliers can command premium prices during about 10 prime days in festival season, Wallace said, which is similar to Christmas season for retail merchants.
“If you can get $500 a night for a room that’s normally $69,” he said, “that’s like having it rented out for a week.”
Coachella’s musical events have achieved international fame and boosted travel to the desert, hotel sales broker John Strauss of JLL said.
Over the last five years, the Coachella Valley “has become the music festival capital of the world,” Strauss said, “creating a lot of market buzz regionally, nationally and globally.”
Other events such as golf and tennis tournaments draw big crowds, he said, and snowbirds from Canada and cold states such as Minnesota visit during the fall and winter high-season to bask in the heat. For millions who live in Southern California, the desert is an accessible weekend getaway.
Demand has reached a point where construction of major hotels such as the Indigo in the Coachella Valley makes economic sense, Strauss said.
Average nightly rates for hotels with more than 200 rooms were $342 to $349 in April, up more than 5% from the same period last year, according to CBRE.