Pushing High End at Sea Level

Breakers toss salt into the breeze as a beachcomber eyes a tide pool. A skim-boarder shoots skyward, then plunges into the foam. On this warm fall day, in a Laguna Beach cove with surf-sculpted rock arches and bougainvillea-draped bluffs, just two sunbathers share the sand with the darting seabirds.

In the past, the few visitors here mostly scrambled down from Treasure Island, a bluff-top trailer park looking out to Santa Catalina Island. Retirees and middle-class families shared paradise with part-time residents such as John Wayne’s widow, Pilar, and weekend fugitives from inland heat and smog.

In the future, far more visitors will stroll down from the trailer park’s replacement: a 275-room resort hotel, 18 estate homes and 19 condos for the wealthy, with beach trails, scenic overlooks and 70 parking slots for everyone else.

Here and at choice coastal sites from San Diego County to Santa Barbara, four- and five-star resorts will proliferate in the coming decades, along with upgrades of older hotels. At least 14 such projects are in various stages of development in Southern California, motivated by a web of economic, demographic and political factors.

Old classics such as San Diego’s Hotel del Coronado and the Four Seasons Biltmore in Montecito have been joined by more than a dozen major resorts in recent years, notably a cluster of four-diamond properties in San Diego.

A 1980s boom produced resorts such as the Loews Santa Monica Beach Hotel and the Ritz-Carlton in Dana Point, before ending in recession and a glut of rooms. But occupancy is again high, especially at expensive hotels.

“The California coast has really been underserved” with high-end resorts, Los Angeles hotel consultant Bruce Baltin said. “There aren’t that many around, and the ones that are have done very well.”

Local governments embrace the resorts for several reasons, not least the taxes they pour into municipal coffers. The projects typically create public parks and beach trails that otherwise would be too expensive to build along the coast. And local business and civic groups welcome meeting rooms.

Even the California Coastal Commission, often the bane of development, can become a powerful ally. The agency is an advocate for “visitor serving” land uses--ones that allow inlanders to enjoy coastal recreation. Resorts satisfy that requirement so long as developers provide some free or lower-cost beach access to offset the upscale lodgings.

Underlying these factors are prosperous times and the powerful demographics of an aging population. Analysts say millions of baby boomers in their peak earning years are demanding high-end recreation, often several short getaways a year instead of the long summer vacations of their childhoods.

As always, standing in between developers and the coastline are powerful and vocal environmental interests such as the Sierra Club, which has been adept at delaying big coastal projects for years.

Opposition to Development

Indeed, many of these resorts will be constructed over the objections of environmentalists and current beach denizens.

“An awful lot of people who move to these areas to live don’t want to share their beaches,” said Gary Timm, district manager for the Coastal Commission’s Ventura office.

Timm’s district includes Malibu, where wrangling over a proposed upscale hotel on Pacific Coast Highway has gone on since 1985. The developers, who wanted 250 rooms, are mulling over a city counteroffer to allow 100 rooms now and 46 later if the hotel meets civic expectations.

“People always would rather see nothing more developed. And that might be nice,” Timm said. “But there is such a thing as property rights out there, so some development will take place. It becomes a balancing act.”

While Malibu has a dearth of hotel rooms, its coastline is dotted with numerous beach parks for the public, the kind of open space use advocated by groups like the Sierra Club.

Environmentalists contend that tourism is likely to suffer as continued development destroys the beauty of the coast. The California Coastal Act encourages easy, affordable beach access, not hotels for the super-rich, they say.

“People have always come to the California coast to experience wild lands,” said Mark Massara, head of coastal programs for the Sierra Club.

“It’s worth much more preserved as open space, beach access or agricultural use. If what people want is a Radisson, they can go to Anywhere, U.S.A. And the more we clutter our coastal zone, the worse we’re going to hurt our coastal economy.”

Population Shift Aids Boom

Not surprisingly, most tourism experts strongly disagree.

“The reality is I think there’s room for it,” said John Poimiroo, director of the state Division of Tourism.

“Upper-end hotels are the ones that are full. It’s the middle and lower end that are hurting to fill the rooms,” he said. “People want to indulge themselves on vacations, and they’re willing to pay for special experiences.”

Households headed by 45- to 54-year-olds spend far more on recreation than households headed by people in other age groups, noted Mark Zandi of the economic consulting firm Regional Financial Associates.

“That’s where the population is now and through the next decade,” he said. “So age favors increased spending on entertainment and tourism.”

New ranks of affluent tourists have been created by Wall Street winnings and rising home prices, further fueling the demand for luxury lodging.

Completing these resorts, however, will not be easy. For now, worries over foreign troubles and a slowing domestic economy have made hotel funding hard to come by, though most experts say that will eventually change.

“Not all of this is going to get built in the next 36 months, and some may not happen in our lifetime,” said Newport Beach hotel broker Donald W. Wise, first vice president of CB Richard Ellis. “But over the next 10 or 15 years, certainly,” most of the resorts will be built.

Despite economic troubles in Asia, Russia and elsewhere, foreign travel is expected to increase as well.

“The world is going to have a larger middle class,” Zandi said. “Many of those folks will come to the United States, and many of them will come to the West Coast.”

As the new resorts lure top-end travelers, older upscale hotels will be forced to charge less and cater to mid-range tourists. Poimiroo believes the most likely economic losers will be aging, lower-priced establishments in beach cities.

“It’s a real concern,” said Wayne Baglin, a real estate broker and former city council member in Laguna Beach, which has its share of older beach hotels. “The challenge will be finding ways to gently get the owners to spend what’s needed to fix them up again.”

Shelved Projects Revived

Many of the new resorts actually are revivals of high-flying 1980s proposals that crashed in the early 1990s, when recession compounded overbuilding from the last big hotel boom.

Some already have opened, including the Four Seasons Aviara in Carlsbad. For years, the hotel sat unfinished beside a championship golf course, a skeleton-like symbol of the hotel bust. It finally was completed in August 1997.

Another revived plan, on a Palos Verdes Peninsula bluff where Marineland of the Pacific closed in 1987, shows how pressures combine to encourage luxury resorts.

Jim York, head of the partnership that now owns the site, said he would have been happy to build just houses. But that idea was rejected by Rancho Palos Verdes officials and the California Coastal Commission.

“They said it would not be possible,” York said. “It has to be visitor-serving” to comply with the commission’s mandate to improve beach access.

So York hopes to breathe new life into a former developer’s plan that the city and commission approved in 1991. In addition to a 400-room resort hotel and 50 condominium-style suites, the approved complex includes a spa, a conference facility, a network of public trails to the rocky beach and a nine-hole golf course.

But York has a problem, one resulting from the demand for top-flight recreation. A study by PKF Consulting, the firm headed by Los Angeles consultant Baltin, concluded that the project could never find financing with such a small golf course.

“Because this is a somewhat remote location and does not have a white sand beach, we were told it needs to be a golf-oriented conference resort,” York said. “And serious golfers don’t go to a resort to play a nine-hole golf course.”

This week, he plans to make public a bigger plan that includes an 18-hole course, asking the city to provide him extra land for it.

Such concessions are commonly made by cities, because of the many benefits a resort brings.

Besides producing less traffic and visual pollution than, say, a shopping center, the hotels pay bed taxes that go entirely to the city.

The Treasure Island project in Laguna Beach, for example, will pay the city 10 cents in bed tax for every dollar it makes by renting rooms.

For nearly 20 years, Treasure Island owners got nowhere with plans for all-residential projects. But with a resort as the linchpin, the City Council struck a deal.

Laguna Beach earned $2.2 million in bed taxes last year, up from $1.1 million a decade earlier. Officials estimate the new resort will add $2.2 million to $2.6 million a year to the take.

“When you go with a nice hotel, dollar signs just light up everyplace,” Baglin said.

Trying to Increase Public Access

For the public, an undeniable benefit from the resorts is greater access to the coast.

To win Coastal Commission approval for a major overhaul of the Balboa Bay Club, the private Newport Beach club granted public access to a resort hotel, dining facilities and waterfront on the property.

At Treasure Island, the concession was parking for 70 cars, a long, narrow public park atop the bluff, and paths to a cove the public had previously reached only by scrambling over a rocky point or swimming.

And bidding to develop a new resort on the Santa Barbara waterfront, actor Fess Parker pledged to improve a public park and build a youth hostel.

The commission’s district manager in Long Beach, Teresa Henry, expects the deal-making to continue unless public funds become available to buy expensive coastal lands.

“We can’t set room rates,” she said. “In the absence of money for public acquisitions, the concern will be to protect views and gain as much public access as we can.”

As the decades pass, such trades for access will make it easier for most people to stroll a beautiful beach during the day. But living there, or even spending a night, will become more difficult, continuing a trend that began a century ago, when development began encroaching on the rustic beach camps seen in old photographs.

The Crystal Cove historic district, a ramshackle clutch of 46 cabins and cottages on the beach near Corona del Mar, began as one such tent camp.

Four generations of Bud Carter’s family have enjoyed a cabin his parents bought there in 1939 for $750. They leased occupancy rights from the Irvine Co. and later the state, which acquired the land in 1979 as a small part of Crystal Cove State Park.

“My dad was a sign painter, and we paid something like $25 a quarter,” Carter said. “Most of the people were not wealthy, just people who loved the lifestyle. Where could you find a place anywhere in the world like that, right on the beach?”

Plans Raise Access Concerns

In the coming millennium, the answer to that question may well be Crystal Cove--if you can pay as much as $400 a night. Cove residents are awaiting eviction to make way for the most unusual of the proposed new expensive resorts.

In a deal with state parks officials, the developers plan to spend $25 million to bring the cottages up to code and add new units, swimming pools, a restaurant and a dive shop. A marine biologist will be on hand for ocean study programs.

The average room rate will approach $300, though a few rooms will be discounted to $100.

The public will be able to walk to the beach, eat at the restaurant, visit the dive shop and take part in the study programs.

The state parks system, historically cash-strapped, will receive an estimated $1 million annually for the 55-year term of the lease.

And a youth hostel, funded in 1984 by developers of the Ritz-Carlton in Dana Point, will finally be built--though somewhere away from the beach instead of in the cottages by the shore, as once had been planned.

The Sierra Club’s Massara scoffs, vowing to oppose the project before the Coastal Commission.

“Most of California’s residents and visitors are not among the super-rich,” he said. “What we have is a severe lack of low-cost, visitor-serving uses. And that was the original purpose of the Crystal Cove acquisition.”

Carter declined to join the debate or complain about the evictions. “All I can say is I’m darn glad we were lucky enough to get in on it back when we did,” he said.

Times researchers Sheila Kern and Lois Hooker contributed to this report.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Rich Rooms

The shape of recreation in Southern California will take a turn toward the luxurious in the near future. At least 13 new hotels and time-share resorts are under construction or in the planning stages along the coast from Santa Barbara to San Diego. Existing resorts and major projects in the works:

GOLETA

1. Project: Santa Barbara Club Resort and Spa, a 400-room resort on 72.7 acres

Status: Early construction

SANTA BARBARA

2. Parker’s Doubletree Resort

3. Project: Five-star hotel proposed by former actor Fess Parker, beside his existing resort Status: City approved it as a 150-room hotel, but Parker wants 225 rooms

MONTECITO

4. Four Seasons Biltmore

5. Project: Miramar Hotel refurbishment

Status: Owner planning to convert into resort and spa

MALIBU

6. Project: Rancho Malibu Hotel

Status: City Council has approved project at a maximum of 146 rooms; original plan was for 250 rooms

SANTA MONICA

7. Loews Santa Monica Beach Hotel (exists)

8. Shutters on the Beach MARINA DEL REY

9. Ritz-Carlton hotel

HERMOSA BEACH

10. Ocean Lofts at the Beach House

RANCHO PALOS VERDES

11. Project: 400-room resort on 103-acre site where Marineland aquarium once operated

Status: Approved in 1991; developer wants city to provide extra land to expand proposed golf course

HUNTINGTON BEACH

12. Waterfront Hilton

Project: 517-room luxury hotel, health spa, conference center, shopping complex and residential area adjacent to Waterfront Hilton

Status: Scheduled to open in 2000

NEWPORT BEACH

13. Project: Balboa Bay Club renovation includes a small resort hotel open to the public

Status: Approved

14. Project: Developing unused portion of Newport Dunes RV resort into 400-room resort hotel and 100 time-share units

Status: Environmental impact report underway

NEWPORT COAST

15. Project: 650-unit time-share facility with access to Pelican Hill Golf Club and Crystal Cove State Beach

Status: First phase opens in 2000

CRYSTAL COVE

16. Project: Historic beach cottages to be converted into 70-unit resort

Status: Pending

LAGUNA BEACH

17. Surf & Sand Hotel

18. Project: Former site of Treasure Island mobile home park to be converted into a 275-unit hotel, 18 estate homes and 19 condos

Status: Approved

DANA POINT

19. Ritz-Carlton hotel

20. Project: Monarch Beach Resort across from Ritz-Carlton; residential development with a luxury hotel and golf course upgrade

Status: Approved in early 1990s but placed on hold when recession occurred

21. Project: Developing part of Dana Point headlands into a hotel and residential community

Status: City and Coastal Commission approval pending

ENCINITAS

22. Project: 131-room resort on 4.3 bluff-top acres; trail to beach, public overlook

Status: Approved in 1993 but now for sale

SAN DIEGO

23. Seven existing luxury resorts, including the Hotel del Coronado, located in the Coronado Bay area

Sources: California Coastal Commission, Goleta Chamber of Commerce, Sierra Club, Marriott Vacation Club, Times reports; Researched by E. SCOTT RECKARD, JANICE JONES DODDS, SHEILA KERN and LOIS HOOKER/Los Angeles Times

High-End Trend

Southern California’s luxury and upscale hotels have experienced higher occupancy rates than lower-priced lodging over the last year. Average daily occupancy rates, by type of accommodation, September 1997-September 1998:

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Luxury Budget San Diego 77.1% 64.5% Santa Barbara/Santa Maria 72.8% 64.6% Los Angeles County 72.6% 59.7% Riverside-San Bernardino 71.8% 52.2% Orange County 68.3% 58.5%

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Source: Smith Travel Research; Researched by E. SCOTT RECKARD/Los Angeles Times

Launch Point 2000

More information on today’s topic can be found on several Web sites:

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Resorts--California Resources: Explore a wide assortment of resorts through this helpful guide, which includes a special listing of those right on the sand.

https://www.nerdworld.com/nw8169.html

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California Travel & Tourism: Take advantage of all that California has to offer through this site that lists upcoming events and festivals, points out where movies were shot and allows you to send electronic postcards from key attractions. Other resources include a detailed guidebook, maps and an online reservation service.

https://gocalif.ca.gov/

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Excite Travel: United States: California: From lodging arrangements to the current weather report, this site makes traveling in California easy by providing comprehensive resources by region, county or city.

https://city.net/countries/united_states/california

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Cool Spots California: Interested in viewing the birthplace of Silicon Valley or the site for Mark Twain’s story, “The Jumping Frog of Calaveras County”? Take an eclectic tour of California’s historic and funky spots through this site’s mini photo tours.

https://www.coolspots.com./index.html

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Tourism Research Links: Learn about current tourism issues and research through this collection of links geared toward travel professionals.

https://www.tourism-montreal.org/tourism.html

About the Series

Beyond 2000 is a series of articles that explore how our lives will change in the next millennium. The series will continue every Monday through the end of 1998 as The Times Orange County examines what’s in store for the county in such areas as transportation, education, growth and technology.

On the Internet

The Beyond 2000 series and an interactive discussion are available on The Times Orange County Edition’s Web site at https://www.timesoc.com/HOME/NEWS/ORANGE/beyond.htm.