The South Coast quietly ushered in a new era of luxury hotel construction on Dec. 18 when Orient-Express took the wraps off the rebuilt and remodeled El Encanto, a once-faded gem located on Santa Barbara’s Riviera.
With a few dozen media types, movers and shakers, and Mayor Helene Schneider looking on, Orient-Express Regional Managing Director Ali Kasikci introduced the property as the chain’s “love child.”
He vowed that the long-shut hotel, which will open next year in March, will restore the romance and the romantic views which were once its hallmark.
With 92 rooms, killer views overlooking the downtown and harbor, killer entertainment spaces and a new spa, El Encanto would be impressive in its own right.
But for Orient-Express, the city’s finances and the region’s tourism industry, El Encanto is a significant turning point.
First, Orient-Express. Even though the affable Kasikci is a veteran hotelier with years of experience running luxury properties in and around Los Angeles, Orient-Express does not have any West Coast presence. The 46-unit collection of hotels, restaurants, train and cruise properties faces complaints from some shareholders that it is not growing fast enough. The bottom line is that El Encanto is a bet on expansion into a new geographic area.
And a big bet it is. El Encanto’s reconstruction costs are running more than $100 million, and one person familiar with the property put it at $135 million. That’s more than $1 million per room key, which means General Manager Laura McIver, a talented woman who took the helm after turning around Canary Hotel in downtown Santa Babara, will be plenty busy.
Next, the city of Santa Barbara. When El Encanto’s 92 rooms come online next year, the city will get a sustained windfall from its portion of hotel bed taxes now running at 14 percent. Then there will be the sales taxes on food and beverage, the added spending by visitors and employees and, for the first time in perhaps more than a decade, the city will have a reliable stream of new revenue.
Moreover, if El Encanto’s relaunch is a success, it is likely to spur financing for two properties still on the drawing boards within the city, La Entrada on lower State Street and Fess Parker’s Waterfront Hotel, across from his eponymous DoubleTree Hotel.
Finally, the broader region. Less than 10 miles south along Highway 101, Los Angeles developer Rick Caruso’s crews are dismantling the remains of the Miramar Hotel, another coastal gem that fell on hard times.
If and when Mirmar gets fully off the ground, that would make four luxury hotels totaling something like 500 rooms on the South Coast, all with permits and in various stages of development. The creation of that number of rooms is something on which the entire region, from Ventura through San Luis Obispo, can stake its tourism future.
The way things happen around here, the developments will happen very much in fits and starts. There will be no fireworks, but more modest moments, such as the toast Kasikci offered on a cool and blustery evening on the Riviera.
But Santa Barbara does attract luxury brands. One overlooked moment in the evolution of its tourism industry was the sale to Orient-Express several years ago by the Friden family. When Orient-Express expressed an interest, “I felt like we’d just had a child who was accepted to an Ivy League college,” recalled Kerin Friden, former owner of the property.
Kasikci, McIver and company know that luxury hotels are high-risk, high-reward propositions. The hotel opens March 18, on what would be the centennial of the original El Encanto. But looking forward, it is the next century for luxury accommodations in the region that is just beginning to unfold.