ANDREA BALAZS: MAX. HEAD-ROOM

RENZO + ANDRÉ

RENZO + ANDRÉ

Responsible for some of the most luxurious haunts in the US - the Mercer,Chateau Marmont - André Balazs is already in the hotelier hall of fame. And now, with the opening of his latest, he brings his magic touch to the capital for the first time with the Chiltern Street Firehouse

Sharp American hotelier André Balazs has been waiting to make his power move into London for quite some time now. Back in 2006 he was knuckle-bitingly close. Together with the property developer Anton Bilton, Balazs submitted a £100m bid for Fortress House, one of the landmark buildings of post-war London to be found onSavile Row

At the eleventh hour, however, the bid failed. Of course, this made Balazs even more determined. This month - with the opening of the Chiltern Street Firehouse, a 26-room palace of opulence located in hip, villagey Marylebone, that is part oligarch haven, part high-end aristo-aesthete hang-out - his ambitions (and those of his co-developer Harry Handelsman and investors including Google's Eric Schmidt and Diesel's Renzo Rosso) will finally be realised.

The son of Hungarian immigrants who fled to Sweden during the Second World War before settling down in Cambridge, Massachusetts, the young Balazs read humanities at Cornell University before going on to do a postgraduate business and journalism course at Columbia University, New York. On completion, however, rather than entering the media, he and his father founded what would become a successful biotech company, Biomatrix. Living, walking and working deep within the frenetic, raw streets of SoHo, Balazs' entrepreneurial eye became drawn to the potential of the then cast-iron manufacturing buildings lying abandoned, which were a world away from the fashion stores and high-end eateries of today. 

Opening a nightclub in the Meatpacking District called MK whetted his hospitality-impresario appetite, after which he made his first -significant acquisition when he took over the legendary Chateau Marmont, Los Angeles, in 1990. Although the hotel's walls were riddled with starry stories - Jean Harlow slept with Clark Gable in one of its suites; Greta Garbo was once a resident and John Belushi died in one of the private bungalows - the hotel itself had fallen into disrepair. What Balazs was able to do was keep the hotel's priceless Hollywood heritage, yet upgrade and repair every fitting, floor and fabric in order to meet the requirements of the modern, fast-moving, supremely demanding traveller.

There's no doubt the Chiltern Street Firehouse will become the jet set's home from homes

Balazs' tastemaking reputation was cemented- with the opening of the 75-room Mercer in New York, a hotel where early residents included both Rupert Murdoch and Calvin Klein. The understated yet chic subtleties of the Mercer have since made the property first choice for a heady mix of actors, fashion designers and figureheads from the entertainment industries. Soon after the Mercer, he opened the Standard Hollywood, later followed by the Standard High Line in Manhattan - both succeed in being affordable lodgings that are everything chain hotels are not: sexy and whimsical. 


For Balazs it's all about stimulating what he calls "moments". Like the peak-a-boo floor-to-ceiling windows in the Standard High Line or the pretty, near-naked models he places in a Perspex box at the reception to the Standard Hollywood. Balazs understands that rather than simply having a great bar or a cool restaurant, hotels have to give each guest an experience that lasts much more than 24 hours. He takes great care in thinking about every kind of nuanced space for every kind of activity - whether that be a business dinner, a drink with friends, or a more salacious experience with someone you hardly know. 

Chiltern Street Firehouse - built in 1889 and designed by architect Robert Pearsall - with its working fireplaces in most suites, rich textures and exposed wood used throughout, will slot perfectly into Balazs' luxury collection of properties. It is a set that, alongside the Mercer, includes Sunset Beach in Shelter Island, New York. Using the idea of a grand old English house, the main restaurant will be home to Michelin-starred chef Nuno Mendes, and the intimate bar is the perfect place to either drop in, drop out or to drop your schedule for the rest of the afternoon. There's no doubt it will quickly become the capital's wealthy jet set's home from homes. The playboy king of American hotels has final arrived. London, it's your round. 

andrebalazsproperties.com


The Mercer lobby at dusk. A great hush envelops the room, as if there has been a demand that tones are kept classy and collegial, but over the faint clink of silverware on china, some things carry. “The most important step after this conversation is to see Richard Serra . . . ” “The political nature of the firm is such that you will not be able to develop those ideas autonomously . . . ” “As it is written, this is a man who has never gotten his way in life, and we must have someone who reflects the vulnerability of that position . . . ” “Richard Gere!”

In a corner nook, beneath the flattering white light of a rectangular hanging lamp, sits André Balazs, sybarite and businessman, the proprietor of the Mercer and a small empire of exceptional hotels, as well as a newly minted condo developer, or, in his parlance, a “creator” of “residences.” You could call him Soho royalty, and he would like that: Balazs has lived in the neighborhood since 1984, what some might call the beginning of the end, and he can tell stories of what it was like to live above the old Dean & DeLuca, just down Prince Street from where we’re sitting, or how, during a blizzard, he scaled a snowbank with Calvin Klein to visit Keith McNally in the semi-constructed Pravda, the three of them underground in the storm’s dead silence.

André Balazs is a small man and very handsome. This is his real name, though he is not French, as you might fairly assume. At 48, his face is barely creased with age, and there is nothing about him that is blemished—the shave is close, hair freshly cut, expensively understated clothes well pressed. A gray-stone pot of tea sits in front of him, and I order one as well.

“That’s good,” he says. “That’s good.”

It’s a compliment, I suppose, because Balazs is one of the city’s great authorities on sophisticated living. Creator, though it sounds silly, is perhaps the best description of what he does. He does not aggressively finance and acquire properties, and his forte is not managing properties or being a real-estate investor. He is a performer: Much like a nightclub impresario, his own investment is secondary to his ability to bring money and architecture together to create a significant hotel experience, and more than any other hotelier today, he has proved himself able to keep the cool people when they come. The Raleigh in South Beach, the Sunset Strip’sChateau MarmontSunset Beach on Shelter Island, L.A.’s twoStandard hotels, Hotel QT in Times Square—these are all his. Each provides a socially salubrious experience, a kind of swishy Club Med for young urban tastemakers. The obvious comparison is Ian Schrager and his battalion of boutique hotels, but Balazs’s hotels are far more unique and eclectically designed. He does a little advertising, and the press has been almost universally kind to him and his properties.

As careful as a politician in his speech, Balazs is quick to say that his hotels and new condos, Richard Gluckman’s One Kenmare Squareand Jean Nouvel’s 40 Mercer Residences, are “not for everyone, but they appeal in a strong way to a very select group.” Very clever, Mr. Balazs, for who can resist when the select group has traditionally included movie stars, like his current girlfriend, Uma Thurman, or Russell Crowe, he of the telephone toss at a Mercer desk clerk this summer, or, perhaps, Rupert Murdoch and Wendi Deng, who stayed in the Mercer for months before they purchased their Soho apartment, now on sale for $28 million. The Murdochs commissioned Paris-based furniture and interior designer Christian Liaigre, designer of the Mercer, to design their entire apartment, “soup to nuts,” says Balazs. This morning, the “House & Home” section of the New York Times quoted Deng on her vision for her apartment. “We just thought we want something like that style [of the Mercer],” she said. “But better.”

“Ah,” Balazs says uneasily, sipping his tea. “That’s very, very sweet.”

Balazs’s hotels are wonderful, frivolous, artistically free, as true to the spirit of boutique-hotel godfather Morris Lapidus as good-time icons like the Paramount or Balthazar or the Maritime, but none of them will necessarily be landmarked buildings—they are about temporal experience, and some are only as good as the guests housed within. Today, Balazs wants to compete in a bigger game.One Kenmare Square, whose 53 apartments all sold before the interiors went into the building, was the initial gambit, and not everybody thinks it’s a masterpiece. “It’s a unique solution to the problem of the site,” says Balazs. The building has a wave in it like a modern Finnish vase and is set on a sorry excuse for a “square” on Lafayette Street below Spring. “If there was one thing I’d do differently, I don’t think the windows, the glass, is light enough—the darkness did surprise me,” says Balazs. “It gives it a slightly ominous look.”

Creating a building even better than the Mercer is Balazs’s current fixation as he enters the façade-finishing phase of construction on 40 Mercer Street, a fifteen-story condo building between Broadway and Mercer on Grand, to be completed by next August. Prices range from $2.3 million for 1,222 square feet to $12.5 million for a duplex with a private pool. Twenty of the 40 apartments are sold. It is the first residential project in the U.S. by the neo-modernist Nouvel, known for wearing black every day of the year except during the month he summers in Saint-Paul-de-Vence, when he wears only white. It is glass, like everything that is new at the tippy-top of the market today, all these voyeurs hovering in their pseudo-case-study apartments up in the downtown sky.

“The challenge is, how do you build an unabashedly modern building in a historical neighborhood?” says Balazs. “Do you do something like the Tribeca Grand and try to pretend the building was built a hundred years ago? Or do you probe deep and try to find the essence and build something new but appropriate? To me, the Disney-esque approach of doing a faux building was just repulsive. To me, it violated the very Soho that I’ve known for 25 years. Soho is a gritty former mercantile area that has, of course, evolved into the most bourgeois neighborhood in New York. If the reason this district is landmarked is because at one time it embraced a tremendous modernism of the time, then the most authentic thing is to approach it anew.”

 

It was a sunny day indeed when Herbert Muschamp wrote his review of the building upon its approval by the Landmarks Preservation Commission in 2001, calling the decision of “breathtaking importance for the future of architecture in New York.” In one of Muschamp’s greater flights of fancy, he wrote that the building was “made for Moody’s ‘Mood for Love’ as performed by King Pleasure, on a rainy weekday afternoon, downtown. . . . Not least, this design is about sex.”

One rainy day, Balazs looks up at the great concrete skeleton of his building from in front of the sex-aids dispensary Toys in Babeland. “This is everything I wished I could have had at the lofts in Soho I’ve lived in, everything I loved having at the Mercer, and everything I wished I could have at the Mercer,” says Balazs. He realizes where he is standing and chuckles.

It certainly sounds nice to have in-house parking and a concierge and a pool, and to be able to move the seventeen-by-twenty-foot sheets of glass that are your windows with an electronic button. There is a shared bathhouse, including a sauna and steam room—“for birthday parties!” says Balazs, who seems to have made it a personal mission to bring shvitzing to the elite; he is a patron of the Tenth Street Baths, his downscale Hotel QT in Times Square has a sauna and steam room, and the new Standard in Miami is more a spa than a hotel, including a large hammam. Baden-Baden was the first hotel Balazs visited as a kid. “A spectacle,” he says. “I remember it was everything.”

The notion is that at 40 Mercer, with a buyer’s brochure that includes a children’s book about two Soho dogs who fall in love and move into the building, you can live as though you are at a fabulous André Balazs hotel every day. On the building’s top floor, a view of the spires of downtown spread at his feet, and romantically enhanced by the rare graffitied water tower, Balazs wades his Prada shoes through the construction crew’s cigarette butts and Pepsi cans floating in deep puddles. “I don’t know if I’ll move in here,” he says, a smile spreading over his face. “I haven’t decided.”

Balazs is in the enviable position of having his celebrity precede him these days. To have Uma Thurman as a girlfriend could provide mystique to Michael Bloomberg. There is not a hint of the striver about Balazs, though his voice bears traces of a Boston accent. The son of educated Hungarian immigrants who left their country during World War II, resettling in Sweden and then Cambridge, Massachusetts, Balazs grew up in a Swedish-Danish-designed home. “My parents always kid that the things I’m into today are the same things they had back then,” he says. His father taught at Harvard Medical School, and his mother is a psychologist. Balazs went to prep school and doesn’t have particularly fond memories of Cambridge. “It’s surprisingly close-minded,” he says. “It’s scared. There’s a fearfulness there. To me, the most charming quality of New York is its open-mindedness.” At Cornell University, he studied humanities and wrote short stories with Harold Brodkey, a mentor and friend, and started a Playbill-type publication for upstate New York rock concerts. After college, he attended a joint journalism-and-business master’s program at Columbia University.

“For my thesis, I checked into the Bowery Mission,” he says. “I lived there for a week, as though I were homeless. There was one guy who had been an accountant, became an alcoholic, and his very bourgeois and seemingly secure life changed into complete abandonment and loss. Despite everything that the shelter could offer—shelter, food, clothing—all people wanted was a woman, a place of their own, and a job, in that sequence.”

Balazs decided against journalism, though he worked briefly for David Garth on Bess Myerson’s Senate campaign. Then father and son founded Biomatrix, a Ridgefield, New Jersey–based biotech company, and Balazs was able to secure his nest egg. It was the mid-eighties, and he was living in a fifth-floor loft in a Greene Street building otherwise occupied by rag merchants. He went to nightclubs. He met Eric Goode, who was founding the legendary M.K. “Eric approached me and said, ‘Do you want to do a nightclub? We need more money,’ ” says Balazs. “There was a big dichotomy between the life I was leading in New Jersey and everything I was interested in. I had a desire to merge the work and private life.”

Today, sitting in a red chair in his jewel of an office in the Puck Building, Balazs is surrounded by well-thumbed design books and mementos, like a candid photo of Helmut and June Newton (Balazs was at the hospital when Newton passed away, after a car accident outside the Chateau Marmont). A faux–Egon Schiele drawing leans against a wall: Balazs had it commissioned as a lark, collaborating with a group of artists to produce a show of fake masters at a gallery in Japan. It was performance art—they estimated the cost of materials to make the painting, an hourly wage for the artist, and expenses like the cost of a six-pack of beer, then calculated the difference of a real Schiele. Balazs calls this spread the “fetish value.”

“It’s sad, in some ways, what happened to Soho,” says Balazs. “It is still the most complete and yet most unique neighborhood in the city. It is missing the art world. That’s one of the sad and inevitable evolutions. But it is an evolution, and instead of it comes something else.”

Earlier, in the bustle of Mercer Street, with its new cobblestones and aging bistros, high-stepping models and sauntering tourists, Sunglass Hut and Yohji Yamamoto, he says, “I like to think of 40 Mercer as the last artwork in this neighborhood.”

 

 

TWA TERMINAL JFK AIRPORT / NYC

TWA TERMINAL JFK AIRPORT / NYC

THE NEXT PROJECT : THE TWA TERMINAL HOTEL

 


DAVID: The Chateau Marmont occupies a really rich tradition in Hollywood history as the ultimate Hollywood scandal hotel. [both laugh]
ANDRE: We wear that badge proudly.
DAVID: Is that tradition still continuing? 
ANDRE: Oh, I would hope that tradition continues. Absolutely. I feel that a good hotel and all the classic hotels in the world always have more than their share of scandal and all sorts of great love affairs. I mean, it seems to me that a good hotel will encourage that kind of excess and behavior. 
DAVID: How does it do that? 
ANDRE: I think there are two unique functions. First, a good hotel immediately sets up a zone of comfort and safety that will envelop you. And it does that with lots of different messages and signals having to do with the staff, with the physicality of the place. And they're all things that you can study and analyze — you can figure out the signals. The other is that, having then established a sense of comfort, it encourages you to feel like you're some place totally else. 
DAVID: To leave your old self behind? 
ANDRE: Yes. And that encourages you to do things that you wouldn't necessarily do in your own environment, which is what I think makes hotels interesting. But ten years ago when I first bought the Chateau, it was in a very bad decline. It was no longer at all an interesting or charming place. A lot of people had simply stopped going there.
DAVID: It still had a seedy glamour. 
ANDRE: Even if there lingered in people's minds this aura, which was a very powerful aura, it was clearly no longer reality. But there are many people I've found who are hotel junkies. They are very passionate about where they stay and about the kind of experience they have in a hotel. They'll write long letters about it. They talk about it with great passion. For example, when the writer Eve Babitz came back to the Chateau, she wanted to talk about what I was going to do with the hotel. 
DAVID: In terms of renovations? 
ANDRE: How we were going to renovate it, yes. I think she was very afraid that somehow the spirit of it would be tampered with. And she came in and saw one of the model rooms that we worked on and said: "This is really really nice. I love it." But she also said, "I'm not sure you could commit suicide here." [both laugh] To me it's very important that a hotel have that kind of rakish, charming, instigating atmosphere.
DAVID: So now that The Chateau Marmont looms over The Standard, what sort of dynamic do you think has popped up between them? 
ANDRE: Well, it's a very different kind of hotel. We live in a time where the young are totally versed in what's going on in music, fashion, all kinds of cultural things. And frequently your sophistication far exceeds the capabilities of your wallet. And I found that there are a lot of people who are just as conversant with all the cultural currents that you're trying to incorporate into a hotel — their expectations are that they will be entertained in a certain way, the standards are such in a hotel — and yet there was no hotel where someone like that could stay. 
DAVID: So The Standard was created for a younger market? 
ANDRE: You can say that it's a younger market. More to the point was the question: Is it possible to create an interesting environment that is affordable and has all the basics? A hotel that is just absolutely the best and has a different attitude that makes it interesting? Part of it is driven by the fact that every ten years or so there's truly a change in the way people live — the way you use a room, the way you communicate. All these things tend to go through shifts and it's very rare that hotels actually keep up with that. It's one thing for very expensive hotels to keep up with it, but it's rare to find in a hotel that you can afford if you're traveling — when you're on a $150-per-diem allowance. 
DAVID: Which is what most people are on. 
ANDRE: So The Chateau and The Standard have dramatically different price points. I mean, the most expensive unit here is less than the least expensive room at the Chateau ... so it's a completely different price range. But having said that, what's been remarkable is how many people go back and forth. 
DAVID: Oh really? 
ANDRE: For example, if they're on a studio budget, they may stay at The Chateau. But when they're on their own budgets they may be here. 
DAVID: Do you think the renaissance in Miami's South Beach made a hotel like this possible? Or paved the way for the renovation of these types of old retirement homes into hotels, which I understand The Standard was at one time? 
ANDRE: It was most recently. But it was built in 1964 as the Thunderbird Hotel. It was a hotel. And then for the past eighteen years it's been what you'd call a retirement home. It was a very run down place. It followed the steady decline of Sunset Boulevard itself over time. 
DAVID: There's a whole genre of hotels that have, since the early '90s, been opening up for young people on a budget, who want to have a fun, hip experience, which seemed to have its genesis with South Beach. 
ANDRE: Well, the difference is that South Beach has this wonderful air of a resort community. And it's true that there was a lot of hotel inventory that could readily be converted. The idea behind The Standard is that this is really a business hotel. The premise was that the basic way a business hotel works had to be reinvented, and that there is in effect a new standard. 
DAVID: Hence the name. 
ANDRE: Well, despite its name, this hotel is anything but standard. And its genesis is that people are traveling on business — people are coming here to do something. It's not a resort. It's not a beach hotel. It's meant to be an effective, efficient place to work. And as such, it's set up that way. The kind of communications that we have, in terms of T1 lines, I think these things are basic. They're not even amenities any more. I consider a cordless phone and a data port ... 
DAVID: ... like towels and water! 
ANDRE: Exactly. 
DAVID: The Standard has been described, somewhat enigmatically but I think still right on target, as "the first internet-wired, hip-hop YMCA." [both laugh] 
ANDRE: I view this really as offering an alternative to a Hyatt, to a Best Western. So I find more parallels to the reinvention which occurs every fifteen or twenty years in the hotel industry. It's just that this category hasn't had any reinvention in what seems like fifty years. So I don't see that much parallel to South Beach, which I think is a phenomenon really unto itself. 
DAVID: There's a wonderful scene at the beginning of the James Bond movie, Goldfinger, an aerial shot of the Fontainebleau Hotel in Miami Beach, and the camera zooms down to a man diving off the high dive board into that huge pool, and then it continues zooming all the way in to Gert Frobe, who plays Goldfinger, sitting poolside. That made me want to visit the Fontainebleau. But of course when I got there, thirty years too late, it looked like another bland Hilton, and all of Morris Lapidus's fabulous international moderne architecture had been erased. 
ANDRE: In the hotel business it's very easy for the soul of a project to get sucked out of it. For example, it's very common for a designer to be hired by the developer. The designer does their own thing and it becomes a design statement, but it has no bearing on the overall concept of how it's going to be run. Eventually the designer disappears, frequently the developer disappears, and then it's turned over to someone who operates it, and who may have an altogether different approach to the whole thing. This is one of the reasons why you can't simply hire an accomplished designer to create a hotel. They can apply their signature aesthetic, but that does not in and of itself create the soul of a great hotel. 
DAVID: You think it must be a collaboration with the developer in order for it to work? 
ANDRE: And in fact the hotelier. Because if there's a disconnect at any one of those points, it loses something. So it's more complex than simply good design. It's as though you said, "Look, I'm going to make a great movie by hiring the best art director to do it, or the best cinematographer." It's an important component, but a great art director doesn't make up for a missing narrative. 
DAVID: Tell me about the interior designer you worked with on The Standard, Shawn Housman. 
ANDRE: He's here in L.A. He's a production designer who has worked on a number of movies. He most recently did The People vs. Larry Flynt. He's someone I've known for quite a while. He had been one of the principal designers of Area. With The Mercer, we had the notion of a hotel as a home ... 
DAVID: Loft living in SoHo. 
ANDRE: ... and with The Standard it's very much about a hotel as club, as social center. So Sean's background was very apropos for what we're doing. 
DAVID: And it's still not quite finished, is it? 
ANDRE: We're going to have a bar which Mark Newson, the Australian designer, will be doing, behind the restaurant in the lobby. Working on a hotel is always collaborative, and very much a process of first figuring out what the program is, what you're trying to accomplish, and then coming up with a design that responds to the overall vision that also recognizes the inherent architecture. You can't deny what you start with. 
DAVID: This is very Sunset Boulevard. 
ANDRE: When you're traveling, you want to be somewhere that's convenient. But ultimately you also want to experience the uniqueness of the location. And I think a hotel that denies its site is not really providing anything of value. Yes, you can sleep there ... 
DAVID: When did hotels start denying their location? 
ANDRE: It's a holdover from the perception that existed after the Korean War when Conrad Hilton was laying the groundwork for what became the archetypal American hotel company, which now dominates the industry. At that time, the perception was that the world was a dangerous place. The American businessman — and it was almost always a businessman, not a woman — was traveling in a world fraught with danger. And what you wanted to do in a hotel was provide a safe haven. So you would go to Berlin or Amsterdam and settle into something that looked like the place you just came from, like Boston or New York. 
DAVID: To homogenize the hotel experience. 
ANDRE: That was the mandate. Today, I think everything is much more fluid. People want to go someplace else and experience as many different influences and nuances as possible. If you go to Los Angeles, it should feel like you're in Los Angeles. So even though the idea behind this hotel is to try and develop other Standards elsewhere, a Standard in New York should bear no resemblance to a Standard in Los Angeles.
DAVID: Now, you were originally involved with clubs in New York in the late '80s, like Area and MK, which were practically conceptual nightclubs. They brought together art and design in an overall concept. How would you say that lead you to where you are today? 
ANDRE: I've always started businesses. I started a publishing company when I was still in school. And then I co-founded a biotechnology company, which is now on the New York Stock Exchange, called Biomatrix. But I had always been very interested in design, so after about ten years of doing the biotechnology company I was really interested in doing something else. And I had an opportunity to invest in MK, which my friend Eric Goode was starting at the time along with Serge Becker. So I became a partner. 
DAVID: That was about 1987? 
ANDRE: '87 or so. That was my first experience with a restaurant or club. And that led to another restaurant and club that we opened here in L.A. called B.C., a sister-offshoot of MK. That's when I started to stay at The Chateau, and the unique aspects of The Chateau really influenced me. I'm not interested in large hotels and the hotel chain experience. It's that uniqueness of the guest hotel that I find so interesting. So it's because I was coming out here from New York at the time that I found The Chateau.
DAVID: That was really the heyday of Manhattan as the '80s boom town, when everyone was riding so high. How do you look back on those days? 
ANDRE: Nightclubs are cyclical. Frequently people will say, "Oh, my god, it was so great, the nightlife era is not what it used to be." But the fact is, each generation makes their nightlife their own. I don't look back on the '80s as the great era of nightlife and everything since then has been downhill. There's always something interesting all the time. 
DAVID: What are some of your favorite places to go? In L.A. for instance, do you have a particular place that you think really captures the feel of the city? 
ANDRE: I think it's true in New York as well as in L.A. that we live in a time of great tribalization. So there isn't one place in any city right now that captures everything — captures the mood of the times, captures the mood of the city. What you have instead are smaller places that speak to a particular clientele, and what I like to call tribes, because groups of people take on all the trappings of a tribe: the way that people dress, the way they socialize. So a bar or a lounge or a nightclub can look the way it is, but the people who go there typically embody a point of view. And it's everything from the way the hair is cut to the clothing to everything about it. And all of the restaurants and all the nightlife follow that. And hotels should too. 
DAVID: Are you concerned about your hotels being run in the way that you initially conceived them? How do you safeguard the sanctity of the original idea? 
ANDRE: Ongoing vigilance and the kindness of key employees. 
DAVID: There must be a tremendous amount of trust in how you delegate authority to your various managers. 
ANDRE: Well, it's a culture. One has to create a culture. And we're working on it now.
DAVID: Do you have a favorite hotel in America that you could point to? 
ANDRE: I don't have one. Hotels, for better or worse, I now look at and almost dissect them: "Okay, they're doing this really well, but that's not quite as good as it can be." There are a lot of places I really like for certain things, ranging from The Royalton to a very traditional hotel such as The Carlyle. 
DAVID: People make a big deal out of the celebrity clientele that frequents The Mercer, The Chateau Marmont and now The Standard. How important would you say celebrities are to your properties? 
ANDRE: I think all these discussions about celebrity and clientele end up being discussions more about the demands and parameters of journalism today than about the hotel business. We're in the business of selling beds. The interest in who our clientele is is entirely an interest fostered by the outside world looking in. It's a little difficult. Because one of the things that we've always taken great pride in is never ever talking about our clientele. 
DAVID: There's that comfort and privacy zone again ... 
ANDRE: And especially because of the strong relationship between the hotel and the guest. I think discretion is absolutely critical. The hotel business requires that. The hotel is really a repository for so many personal aspects of anyone's life that if you violate that absolute mandate of discretion I think you lose all credibility. If the comfort and safety factor goes, everything goes.

 


Over the course of a long career, André Balazs has been known to keep a tight grip on his hotel portfolio, which is bedazzled with see-and-be-seen properties in Los Angeles, Miami and New York. But lately, his grip has been loosening a bit.

In the last year, the hotelier has whittled his portfolio in a pair of blockbuster moves.

The boldest of those deals came last month, when he sold the real estate behind his signature New York property — the 330-room Standard High Line — for more than $400 million, in what’s believed to be one of the highest prices ever paid for a hotel of its size in the city.

The buyer was the Standard International, the management company and creative force that he’s also an investor in, and which operates the Standard’s five properties — two in New York, two in Los Angeles and one in Miami.

Analysts say that Balazs, a pioneer on the boutique hotel scene, is likely to receive a windfall through the sale of the Standard High Line given that he was one of the owners of the real estate on the property. Sources say he’s likely entitled to between a 10 and 20 percent cut of the profits, but his ownership stake is unclear.

The sale comes on the heels of another related mega-deal.

In September, Balazs, 57, sold 80 percent of his management company, now known as Standard International.

Balazs said he thinks about more than making money when negotiating a deal.

“I’m not interested in cutting corners to build a hotel and then selling it to some other guy for a ton of money,” Balazs told TRD during a phone interview last month. “When I create these things, I think about what kind of experience I would have if I were sitting at a table in the restaurant on a Wednesday night a few years down the road.”

Still some are buzzing about his real estate conquests, noting that Balazs has historically owned more of his hotel real estate than other operators do.

“Everything he has ever touched has turned to gold,” said Bradley Burwell, a vice president at commercial brokerage CBRE Group, who specializes in hotel sales but has not been involved in any of Balazs deals. “And selling the Standard was perfect timing,” because the investment sales market is so strong right now.

Balazs’s moves undoubtedly free up critical capital at a time when the developer is in the midst of pursuing several other projects, including two in London, his first outside the U.S.

In the Standard sale, the hotelier and his institutional partners Dune Capital Management and Greenfield Partners collected about $1.2 million per room in a deal brokered by Eastdil Secured’s Doug Harmon on both sides. While Balazs’s equity position is unclear, Dune and Greenfield have far bigger stakes, possibly up to a combined 90 percent, sources said.

That makes it one of the priciest deals in New York since the W Union Square sold for $285 million, or more than $1 million a room at the peak of the last boom, in 2006, to Dubai World, a sovereign wealth fund.

At the Standard, Dune and Greenfield had invested $240 million over the years, sources said. Balazs told TRD that while Greenfield was his longtime partner, he brought Dune in halfway through the project to “spread the risk.”

According to sources close to the deal, Greenfield and Dune needed to sell now because they had deadlines looming to pay back investors in some of their funds.

Neither firm returned calls.

While most analysts call Balazs’s maneuvering shrewd, a source close to the deal took a more skeptical view of Balazs, saying his two recent sales were less about financial prowess and more about saving face.

The source said Balazs likely sold his stake in the Standard International as a way to distance himself from the operating company because he knew Dune and Greenfield were about to force a sale and he didn’t want to be left operating the hotel if another high-profile owner stepped in and planted a flag there.

Balazs vehemently denied that charge. “It’s silly. It makes no sense. If that were the case, I would have sold the whole stake and been done with it,” he said.

In fact, Balazs said despite his Standard Internation sale, he hopes to expand the management arm of his business into more markets without adding new real estate holdings. He said the move would bring the brand more in line with companies like Marriott and the W.

And if Balazs was desperately searching for an exit strategy in the Meatpacking District, other analysts added, he set himself up nicely with expansion plans already in the works, both in New York and in London. And he seems confident he hasn’t lost his touch.

“We are interested in going where people who we know — who are the types attracted to our hotels and made them such unique places — want to be,” Balazs said.

“There is such banal product in the hotel industry,” he added. “It used to be that the discount hotels were known for their sameness and lack of innovation. But now it’s the highest-end chains that have the same problem.”

The Balazs backstory

Born to Hungarian émigrés who fled their country during World War II, Balazs spent much of his childhood in Cambridge, Mass.

His father, Endre, was an ophthalmologist known for, among other things, extracting a natural Botox from rooster combs, according to news reports; his mother, Eva, was a psychologist.

After high school at the elite Buckingham Browne and Nichols, Balazs shipped off to Cornell University, where he got bitten by the writing bug and launched newspapers and magazines, he said. He then went to Columbia University’s Graduate School of Journalism, where “I was taught by some of the last greats of the Watergate era.”

But his first job, in the 1980s, was with Biomatrix, a New Jersey–based biotech company he founded with his father. Years later, in 2000, Genzyme bought the company from Balazs’s father for $700 million, according to news reports.

But back in the 1980s, when the Downtown clubbing scene was in full force, Balazs was living in Soho. In 1985, he married Katie Ford, whose family founded the Ford Modeling Agency. (The two divorced two decades later.)

Since splitting up with his wife, Balazs has been linked to a string of high-profile women, including Uma Thurman, Pippa Middleton and Chelsea Handler.

Balazs first began dabbling in the hospitality business in 1988, with MK, a club on Fifth Avenue, where he partnered with Eric Goode of the Bowery, Maritime and Jane hotels. “I was more of a passive investor,” Balazs said.

Then in the early 1990s, teaming up with architect Campion Platt, Balazs bought two properties that put him on the map: The Chateau Marmont, a rundown Hollywood property, and the Mercer Hotel, a six-story former warehouse near his Soho apartment.

He showed a deft financial touch with the Mercer, said Paul Stern, a managing director of Wharton Equity Partners who handles hotel investments for the firm.

The $33 million redevelopment of the Mercer required a large loan from a Japanese bank, which Balazs and Platt defaulted on when the economy turned, analysts say. But with the bank panicking, Balazs eventually bought back his loan for a mere $3 million.

Later, Richard Born, a principal of BD Hotels, stepped in to get the project across the finish line. The 75-room hotel opened in 1997, and the pair still own it today.

“It was not just staying with the project,” Stern said. “It was having the confidence to convince other people that they should stay in.”

Today, Balazs’s empire still includes those two properties, as well as the five Standard hotels, plus Sunset Beach, on Shelter Island, down the road from one of his many homes. However, he no longer owns the real estate in L.A. and Miami.

His hotels are not large — some have less than 100 rooms — but like Ian Schrager hotels, most of them have been hot trendsetters with coveted restaurants and bars like the so-called Boom Boom Room at the top of the Standard High Line.

But Balazs is not immune to market downturns.

A deal to build a hotel in the Meatpacking District with a group of investors that included hip-hop star Jay-Z and developer Abe Shnay flamed after the group defaulted on their loan, according to news reports.

It wasn’t the first Balazs hotel that failed to launch. The post-Sept. 11 downturn in 2001 forced him to abandon a hotel project at Kenmare Square in Soho, as well as at 40 Mercer. But Balazs reversed his fortunes by turning both into successful condos.

He wasn’t as lucky at the 47-story ground-up William Beaver House in the Financial District, which he and partner SDS Investments defaulted on, and lost, in the midst of the recession. The private equity firm CIM Group swooped in in 2010, refashioning the condo as rental in the process. The 300-unit building is now reportedly going condo again.

“I wish I still had it,” Balazs said.

Still in the mix

But the hotelier is not hurting for business.

And Balazs, whose soup-to-nuts, detail-oriented approach to his properties is industry legend, will not be disappearing from the Standard High Line, either.

He still owns a small stake in Standard International, and now serves as its chairman and creative director.

Balazs said that the investors who bought his Standard International stake last year include David Heller, a former Goldman Sachs trader.

Heller, who is an investor in the Philadelphia 76ers, according to his LinkedIn profile, also holds a stake in the Standard East Village, according to Balazs. Heller, Balazs and other investors bought the property, then known as the Cooper Square Hotel, in 2011 for $90 million.

Heller’s Goldman Sachs connection isn’t surprising. The bank was one of Balazs’s partners in the mid-2000s on his 40 Mercer Street condo. Likewise, Dune’s CEO, Daniel Neidich, founded Goldman’s first Whitehall Street real estate fund, a private equity fund that was at the forefront of real estate investment in the early 1990s.

And while Balazs and his partners have sold the Standard High Line, neither the name nor the hotel’s services are expected to change, Balazs told TRD.

In addition, since 2011, he’s ventured into a new business: seaplanes. His StndAIR airline whisks passengers from the heliport at East 23rd Street to posh destinations like East Hampton ($525 one way.)

And now Balazs is expanding his real estate empire overseas.

He told TRD he just won a bid to develop an historic government building in the Camden neighborhood of London, near Google’s new headquarters there. Likely to be called the Standard London, the property will have 280 rooms, said Balazs, who will be an operator and is partnering with London-based Crosstree Real Estate Partners.

In addition, last month, Balazs opened another hotel, a renovated 1886 former firehouse in the Marylebone section of London. The 28-room project is called Chiltern Firehouse. It was developed in partnership with Harry Handelsman, a British developer; Renzo Rosso, founder of the Diesel apparel company; and Eric Schmidt, executive chairman of Google. Balazs also has an ownership stake in the real estate there.

Meanwhile, in New York, Balazs also recently unveiled a redesign of the Standard East Village, which is on the Bowery. In addition to Balazs and Heller, Ironstate Development is also an owner. Fortress Investment Group is the lender.

Whatever the reason, changes are afoot at the property. The centerpiece, a tall curvaceous glassy tower, will no longer serve as the entrance. Guests will now enter through a former tenement building on the site in a bid to make the hotel better fit into its historic neighborhood.

Before, the property “looked like it belonged in Dubai,” Balazs said.

And that is not the only recent change.

In January, Narcissa, a farm-to-table restaurant, opened there. Some 40 percent of what ends up on the plates at the restaurant will come from Balazs’s 20-acre spread at Locusts-on-Hudson, his house/event space near Rhinebeck, N.Y.

Narcissa, he said, is named for his favorite cow there.

Analysts say asserting that much control over the supply chain is rare in the hotel industry. Even hotelier Ian Schrager, who is often considered the boutique hotel’s inventor, outsourced his food and beverage operations, sources note. Schrager was traveling and unavailable for comment, a spokesperson said.

“More control of the product gives you a larger share of the profits,” said hospitality consultant and hotel investor Steven Kamali. “He continues to control the quality, he controls the success, he maintains a flag on the brand.”

Kamali also noted that Balazs’s sale of the Standard to a company he’s still an investor in was the best of all possible outcomes.

“Nothing could be better for him, because he stays in the driver’s seat,” he said.

While Balazs is in the thick of his London projects, he’s also working on more projects stateside.

Though still years away from completion, he’s creating a spa at the so-called SuperPier, which is being pioneered by Young Woo in the Meatpacking District.

Part of a sweeping retail project, the spa will resemble Balazs’s Standard Spa Miami Beach, he said, but won’t bear the Standard name.

Other efforts to diversify Balazs’s business line, however, have not panned out.

In September, Balazs was tapped to redevelop the former TWA terminal at JFK Airport, a 1962 Jet Age landmark. Empty since 2001, the iconic Modernist structure is owned by the Port Authority of New York and New Jersey.

The Standard Flight Center was to have a restaurant, spa and museum inside, as well as two new hotel towers. But in late January, Balazs unexpectedly pulled out, citing bureaucratic hurdles.

“As much as that building is iconic, dealing with the Port Authority became too much and too slow-going for us,” he said.

Hotel developer Morris Moinian said Balazs’s decision to focus on his existing projects was a smart one.

Overseas, “he will be building a brand that will take some time to become a household name,” said Monian, principal of Fortuna Realty Group, a real estate investment firm focused on hospitality that has competed with Balazs for deals. “But he can put a box on dirt and make it the sexiest box anywhere.”

 

ANDRE BALAZS / THE HAMPTONS

ANDRE BALAZS / THE HAMPTONS

Andre Balazs Revs Up Sunset Beach

Hotelier André Balazs describes Sunset Beach as a place to enjoy “great, simple food in the open air with sand between your toes.”

Hospitality king André Balazs’s empire now crisscrosses the globe from Hollywood to New York, and beyond. With Chiltern Firehouse, his London hotel and restaurant now the talk of the international set, Balazs has turned his attention to refreshing Sunset Beach, the 20-room hotel, boutique, and restaurant he opened on Shelter Island in 1997. “What attracted me to Shelter Island was the proximity to the water and the sunset view,” says Balazs. “I’m personally obsessed with sunsets. Every home or apartment that I have faces west or is on the water—they are just two things that really mean a lot to me.”

This summer, guests will see “substantially more advanced” dinner and dessert menus. Under the direction of Executive Chef Edgar Cungu, the menu will offer a wide variety of seafood, culinary fusion dishes, and wines, including Balazs’s favorites liked grilled bronzino and crudités, as well as his own Sunset Beach rosé, which he makes in collaboration with local winery Channing Daughters.

 

Balazs with new Executive Chef Edgar Cungu and Consultant Chef Soa Davies.

Balazs remains excited about the experience Sunset Beach offers sophisticated travelers, particularly those who arrive by boat. “I love the idea of someone in their bathing suit, putting their wrap on top of their head with their straw bag, and jumping into the water,” he says. “Even though there is a launch that picks people up, you have to wade to shore—that’s part of the whole charm. I can’t imagine anything more appropriately luxurious for the Hamptons than to have great, simple food in the open air with sand between your toes.”

Sunset Beach wasn’t always the idyllic oasis it is today; although Balazs didn’t alter the hotel’s original bones, he made the place his own. “The motel piece of it is still essentially the same 22-room motel that was there when I found it,” he says. “[Sunset Beach partner] Dick [Tarlow] and I were lamenting the fact that there was nowhere good to eat on the island 20 years ago, and the property was for sale. I always sort of imagined something a bit like Club Cinquante Cinq in the South of France. I felt that kind of casual, good, fun dining was something that was missing from Shelter Island, but it turned out a lot of Long Island was missing it.”

The secret behind Sunset Beach’s success, according to Balazs, is: “Everything is fine. If the kids run upstairs with sand all over them, or if you want to sit down and have an early bite in a wet bathing suit, that’s fine. There are no rules other than to enjoy yourself; whether enjoyment is lazing around in the quiet or shaking your booty after dinner—it’s whatever makes you enjoy your vacation or weekend.” 35 Shore Rd., Shelter Island, 749-2001


He Makes Princely Hotels Out of Frogs

ANDRE BALAZS, the hotelier who dreams of toppling Ian Schrager as the king of hip hospitality, has a way of keeping things up in the air: there are the hotel projects (the Mercer in SoHo, which he owns with other investors, has been a seven-year work in progress), his coterie of talented designers (''too many cooks in a stew that nobody enjoys,'' said Keira Alexandra, a graphic designer on two of his projects) and his own genesis story (his longtime publicity agent didn't know he had a sister). Even, sometimes, his family, who are often found bouncing together on an enormous trampoline at their summer home, a farmhouse in Shelter Island, N.Y. 

''Come join in!'' he invited a wary visitor one recent morning, with smiling persistence. 

Mr. Balazs, 40, has other ways of keeping guests in suspense. Through the day, he worked the levers like a man spinning the rides at an amusement park. First, an excursion in the family motorboat, Shelter Island's equivalent of a Ford Explorer. While he drove full tilt, his wife, Katie Ford, 41, the president of Ford Models, urged the nervous guest to go belly down with her on the stern, feet dangling out over the propellor. Ms. Ford appeared to be soaring through the air like a Jaguar hood ornament, with the occasional slap-slap of her body as the boat hit the waves. 

Driving and chatting, Mr. Balazs (pronounced bah-LAHJ) hit a buoy. He zealously took off his Gatsby wear -- a perfectly crisp lemon shirt and white Oxford bags -- and clad only in white knee-length boxers, dove underwater to free it. 

''It's a shame you didn't get a picture of that,'' Ms. Ford said. 

By dint of charm, and public relations, Mr. Balazs manages to keep things afloat, among them the Mercer Hotel, which has been shuttered for so long, it's become an industry joke: the oldest established nonhotel in New York. (Mr. Balazs said it should finally open in the fall, although an attempt this week to make a telephone reservation was unsuccessful.) 

But other projects are up and running. The Chateau Marmont (and more recently, the Bar Marmont) on the Sunset Strip in Los Angeles has been a retreat for the celebrated since he took it over in 1990 and began seemingly endless renovation. Mr. Balazs, with Frederick Lesort and Mathew Kenney, owns Nica's, the revamped bar and restaurant that reopened in June at the Stanhope Hotel, across from the Metropolitan Museum of Art. Also last month, with a Shelter Island neighbor, Dick Tarlow of Tarlow Advertising, he opened the Sunset Beach hotel on Shelter Island. It has 20 rooms for the gold-card set ($195 to $275 a night) and a beachfront restaurant, which seats 220. His friends, 1980's and 90's boldface names like Brett Easton Ellis, Candace Bushnell, Darren Starr and Sandy Pittman, have become fixtures on the scene since the first weekend, although the cell phone action perturbs some islanders. 

''It's the nightmare of all the locals,'' said a worker on the project, who also recalled how the rush to ready the hotel for the Fourth of July resulted in enlisting waiters to screw in door locks. 

The Sunset Beach follows Mr. Balazs's pattern of taking old unstylish properties and renovating them to look as if they have been charming all along. A 70's eyesore (think Bates Motel) with fake-wood panels and nylon bedspreads, it cost a mere $4,800 a room to update and now looks jaunty, with individual balconies decked out like cabanas in blue-and white canvas partitions and tangerine-color outdoor furniture. 

''It has an air of St.-Tropez,'' Mr. Balazs said. 

''It reminds me of St. Bart's,'' Ms. Ford said. 

''It has the simplicity of Podunk,'' said the interior designer Marco Pasanella. 

Mr. Balazs excels at decorative illusion. The secret of his success is to contrive charming quirks and a casual air of happenstance. 

Nica's bar at the Stanhope has that spirit of pentimento. Created by Shawn Hausman, a set designer for ''The People vs. Larry Flynt,'' it is seeded with hints of a fictional and much-loved proprietor. Over the bar are snapshots of fictional friends of a fictional owner; arty 50's oils are casually nailed on top of murals left over from the original restaurant design, to suggest they were hung in a moment of boozy exuberance or presented by an artist to settle a longstanding tab. 

''It's always the little mistakes that add up to character,'' he said. ''I think you can design that.'' 

On the wall over a 1950's jukebox is a collage of concert handbills for Thelonious Monk, Charlie Parker and other jazz greats, looking as if they had accumulated over the years. Mr. Balazs drew up short. 

''Do you see what's wrong with this?'' he bristled. ''The edge of the 1959 poster wouldn't be on top of the one from 1963.'' It was soon righted. 

In the Chateau Marmont -- where some rooms are being redone for a third time -- he put nonworking old-style radiators in the rooms as homey touches. Most of the rooms are furnished with flea-market pieces. Some of the original 1920's sinks and bathtubs were kept, complete with cracks that make guests wonder which badly behaved movie star caused it -- and how. 

Two hundred yards down Sunset Boulevard from the Chateau Marmont, the former Golden Crest Retirement Home has been renamed the Standard by Mr. Balazs, who hopes to make it the hotel of choice for Generation 2000 when it opens next February -- and the first in a chain of good cheap stopovers. The 1964 building's chief architectural feature is a series of undulating balconies. 

The decor will be bare-bones, but the multisensory perks will be piled on: videos, CD's and computer games provided at check-in, keyed to personal tastes; a house deejay will send up other sound bites. 

''If you look at a person three years out of college,'' Mr. Balazs said, ''they have a futon on the floor, a worn-out pair of sneakers and a $5,000 hi-fi and a fantastic computer.'' The Miami architectural firm Arquitectonica is signed up for the acid-bright interiors, and the avant-garde landscape designer Martha Schwartz for the pool area. 

Richard Born, an owner of 14 hotels, including the Stanhope, entrusted its bar and restaurant, banqueting and room service to Mr. Balazs because, ''he brings something new to the table,'' Mr. Born said. ''The traditional view of hotels is to look at the property as a physical place and ask what we could do to make it nice. Andre focuses on life style and develops clear images of the clientele he's seeking.'' 

For those who gulp at the chic minimalism of Chateau Marmont and Sunset Beach, the Balazs house on Shelter Island is so spartan that some rooms look like nuns' cells, with bare wood platform beds and tiny wood side tables under the whitewashed eves. The 317-year-old house was moved to the spot on barges plank by plank from Old Mystic, Conn., in 1984 by former owners. ''They hired a crew of craftsmen and they lived here for two and a half years putting it back together,'' Mr Balazs said. 

The couple moved to Shelter Island six years ago. ''It's so raw and real, so unlike the aggressive Hamptons,'' Ms. Ford said. In each room a few pieces of furniture are grouped together like still lifes: the placement suggests obsessive precision. Mr. Balazs proudly admits his inspiration was a 14th-century house in Japan, and said he learned a lot by studying flower arranging there. ''I was the only man in class,'' he said. ''It seems so organic and simple, but it's entirely fabricated.'' 

His favorite composition on the property, he offered, is ''the spacing between the house and the garage and the tree -- it is the kind of perfection you find in Japan.'' 

In the master bedroom, a giant raw canvas is nailed to the floor in place of a rug. 

Mr. Balazs says that people comment on the house's lack of personal effects -- photos, books, even toys of the couple's two children, Alessandra, 7, and Isabel, 3 -- but he is unmoved. ''I don't think the house needs more than the wood,'' he said. 

Mr. Balazs is reticent about his past. His parents were immigrants from Hungary -- his father, Endre, a research scientist, and his mother, Eva, a psychologist who recently started a second career as a jazz pianist. The Balazses made a fortune in the 1980's with Biomatrix, a Ridgefield, N.J., company started by father and son to develop biomaterials for medical and skin-care products. 

The son left Cornell University in 1978 and went for a master's degree at Columbia Journalism School. He worked as press secretary to Bess Myerson in her unsuccessful 1980 campaign for the Senate. One of the discoveries of the job, he said, was ''how much control one had -- you can almost force-feed stories to political journalists.'' 

He continues to infuriate former associates for giving himself credit for their joint ventures. Serge Becker, the owner of B Bar and former owner of the nightclub M.K., a star of the 80's scene, said: ''He is master of taking credit for M.K. I've seen it in print several times. He said he was an owner, but he wasn't. He was an investor, and his wife was an investor. There were about 10 investors in M.K.'' 

When asked directly about M.K., Mr. Balazs conceded that he was not the owner. 

His passion for endless tinkering and constant revisions has driven designers out the door. Keira Alexandra, who worked on the logo for the Chateau Marmont and the Sunset Beach, said: ''I've quit about three or four times. He gets the work and likes to take it to cocktail parties to see if his friends like it. Then if they don't, he changes his mind.'' 

Alison Spear, who designed his town house in the 80's and did a model room for the Chateau Marmont, said, ''Name credit is a problem with him.'' For this article, Mr. Balazs vetoed any photographs of Marco Pasanella, the designer responsible for the Sunset Beach, face up -- permitting only a shot of him lying on a terrace like a well-tanned corpse. 

Ms. Spear said: ''I don't think he has a particularly strong vision himself. He gets his taste from everywhere.'' 

But Mr. Balazs sees the process differently: ''The need many designers have to leave their imprint tends to override the need for a place to be comfortable,'' he said. ''At the Chateau I worked with a lot designers with a capital ''D.'' And each time, the stamp of the designer superseded the spirit of the place.'' 

And what is that spirit? Pentimento -- a play on a nostalgia for an imaginary past. ''It's not a real past,'' he said. ''It's an important distinction. The past is really not that interesting.'


Shelter Island Hits New Highs

Hamptons’ Prices Arrive on Shelter Island

A quick ferry ride from either the see-and-be-seen Hamptons on the South Fork of Long Island or the bucolic wine country of the North Fork, Shelter Island has long been the quiet, laid-back vacation haven in the middle, surrounded by Shelter Island Sound and Gardiners Bay.

 

With an abundance of usable waterfront, salt marshes, bay beaches, hiking trails and marinas, the 27.1-square-mile island sits “under the radar screen,” said Melina K. Wein, the broker-owner of M. Wein Realty. “There’s this understated calmness about Shelter Island.”

This summer, though, an unprecedented dozen or so homes along the meandering waterfront have been put on the market for prices ranging from $5 million to nearly $25 million. Though still substantially lower than on the South Fork, the high prices may indicate that real estate on the island is skewing toward the Hamptons rather than the North Fork.

“People are finding in Shelter Island you get more for your money,” Ms. Wein said, noting an influx of Wall Street types and European buyers. “It’s better value. The Hamptons are moving over this way.” A major enticement is the accessible waterfront.



Set behind gates on 7.6-acre grounds that slope gently to a private beach on Coecles Harbor, with moorings and a dock suited for seaplane landings, is a 23,000-square-foot turreted and gabled shingle mansion, listed at $24.5 million. The 10-bedroom house has an octagonal, domed garden room, a wine cellar with a table that can accommodate 10 for dinner, a billiards room, a spa, a disco, squash and tennis courts and a heated gunite pool.

On a nearby bluff on Ram Island is a four-bedroom estate on 5.4 lushly landscaped acres with a screened porch, heated pool, guesthouse, 500 feet of bulkhead waterfront and panoramic views across Gardiners Bay, priced at $14.25 million.

Jonathan J. Miller, the president of the real estate appraisal firm Miller Samuel, said there is “an outward expansion from the South Fork for people seeking large homes that are affordable relative to what is offered ‘south of the highway,’ ” in East Hampton or Southampton. Looking farther afield “is part of a regional trend.”

Just as in the city, Mr. Miller said, “people get priced out of a neighborhood and expand their view, look at other locations. You are seeing more of that occur.”

Two years ago, Patricia Bleistein of Bayville, N.Y., bought a two-story home with a pool on more than three-quarters of an acre across from a beach on Shelter Island for $1.4 million. “In East Hampton it would have been over $2 million,” said Ms. Bleistein, who is the vice president of a building supply company. But price wasn’t her only consideration. “It’s a quaint little town, a quaint atmosphere,” she said. “It’s not the hustle and bustle like the Hamptons.”


The highest sales price so far this year was $9.5 million, beating a $5.95 million sale in 2013. According to Al Hammond, a Shelter Island tax assessor, the median sales price for waterfront homes has risen 45.5 percent since 2008, with a current median price of $2.83 million. (Conversely, more modest inland prices on the island have dropped 15.96 percent over the same period.)

It remains to be seen if the latest waterfront asking prices are realistic. At the top end of the market, Mr. Miller said, houses tend to be distinctive, and the spread between listing prices and sales prices is wider than for more “homogeneous suburban” homes. “Buyers in these markets are pretty sophisticated and aren’t just going to pay anything,” he said.

Seth Madore, an associate broker with the Corcoran Group, said the number of Hamptons buyers shifting to Shelter Island has been on the increase for the last five years, and ramped up this summer with several sales exceeding $5 million. “The secret is coming out of the bag,” Mr. Madore said, adding that the shift is not just about price, “It’s a lifestyle choice and quality of location.”


A front exterior of the home for sale at 175 Ram Island Drive in Shelter Island, top. A front exterior of the home for sale at 15 Little Ram Drive in Shelter Island, bottom.

For boaters, “Shelter Island is vastly superior,” he added. “If you want your own yacht in front of your house, there are very few choices on the South Fork.” On Shelter Island, “there are many estate type properties where you could literally have a 200-foot yacht in front of your house.”

Half his business this year is “Hamptons expats” buying and renting on Shelter Island and “looking to get off the South Fork,” Mr. Madore said. “The Hamptons has become too busy for them. It’s people seeking quality, not seeking status.”

The ferry, a five-minute ride from North Haven on the South Fork and an eight-minute ride from Greenport on the North Fork, adds to the allure, with “a lot more privacy and solitude than other areas of the East End,” Mr. Miller said. “For someone that is looking for that, it makes a lot of sense.”

Mr. Madore said that Shelter Island retains the relaxed, friendly feel of the Hamptons almost 40 years ago. “It doesn’t have the hectic atmosphere the Hamptons is currently experiencing.”

Residents, second-home owners and seasonal renters can enjoy swimming, biking, golf, tennis and hiking at the 2,039-acre Mashomack Preserve; concerts at the summer music school founded by Toby Perlman, where her husband, the violinist Itzhak Perlman, is on the faculty; Wednesday night barbecues at the Pridwin hotel; Shelter Island Yacht Club sailing regattas; and a “pop-up library” on the beach. “Slowly in the last 15 years, the infrastructure has grown to have everything you want,” Ms. Wein said. “We see lot of families coming here. They want more, and the town is giving them more,” including an increase in charitable benefits and Hamptons-style party weekends at André Balazs’ lively Sunset Beach hotel, restaurant and bar on Crescent Beach.


Glenn Petry, who grew up locally (his parents own the Pridwin hotel) and is now a summer resident, said that while the island is slow-paced and has always tilted toward the North Fork, “there is no question you are feeling the change, the incursion of the South Fork on Shelter Island.” The extravagant properties along the waterfront are “very different than the humble abodes that are more prevalent on the island,” he said.

Linda McCarthy, an agent with Daniel Gale Sotheby’s International, said buyers from ManhattanNew Jersey and Nassau County, as well as Europeans, often start house searching in the Hamptons, then take the ferry. “We are getting people that are wanting to come to a place that is a little bit quieter than the Hamptons.”

A case in point is Gareth Jones, a London-born, Brooklyn-based venture capitalist who rented in Sag Harbor before discovering Shelter Island. Four years ago, he bought a home on an acre overlooking Wades Beach.

“After a hard week in New York, I wanted to relax, and I wasn’t really relaxing by going out to the Hamptons,” Mr. Jones said. “I felt the knots getting out of my shoulders when I got on the ferry. It’s a five-minute ferry ride but it’s a real cathartic moment.”