Region Sees a Grand Opening of a Grand Hotel
by Seth Cagin
Feb 12, 2009 | 2509 views | 3 3 comments | 10 10 recommendations | email to a friend | print
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Can the Capella Telluride Live Up to Its Promise?

Nine years and a reported $200 million later, there is a major new hotel in the Telluride region.

The Capella Telluride was scheduled to open its doors today to fanfare, high hopes, and, it is safe to say, some measure of relief as well. The opening of the Capella could be deemed to be the region’s very own economic stimulus. But as is true of President Obama’s national stimulus plan, there is no way to know in advance how well it will work.

The road from conception to completion of the largest construction project ever undertaken in the Telluride region was not only long and expensive, but fraught with peril, including an arduous approvals process that saw numerous compromises with respect to the structure’s mass, scale and design and more than a few occasions when it looked like it would never break ground.

Today’s grand opening could be taken as evidence that long-range community planning can sometimes yield a result. But it remains to be seen whether the economic impact will be all that has been hoped. That is true particularly since the Capella opens its doors in the midst of a deep and possibly deepening local, national and global economic slump.

The most recent data provided by the Telluride Visitors Bureau are not encouraging. Hotel occupancy in the Telluride region was down 17.5 percent in January compared to last January, with revenue per available room down by an even more impressive 30 percent, due to falling room rates. Advance bookings for the next six months are down by a whopping 32 percent compared to last year at this time, with only one bit of hopeful datum: in January, 18.6 percent more visitors booked their accommodations in the same month they planned to arrive compared to last January.

That last statistic suggests an opportunity for recovery ahead, and one that a sparkling, new, full-service hotel like the Capella might help to realize. Bookings at the Capella for the rest of this ski season are encouraging, the hotel’s general manager John Volponi said this week, and the summer looks strong, particularly around major festivals. As an example, this year’s bigger Gay Ski Week, which starts Feb. 21, has booked rooms and has scheduled a number of events at the Capella.

Among the opportunities the Capella should afford the region is the possibility of booking more groups utilizing the adjacent Telluride Conference Center. With the addition of the Capella, Mountain Village now offers a far larger assortment of rooms suitable for hosting groups, and, of possibly even greater importance, there are now break-out meeting rooms at the Capella for groups that use the conference center as their primary venue.

“The group market is extremely challenging right now for not only destination markets but all conference markets,” Scott McQuade, CEO of the Telluride Visitors Bureau said this week, explaining that corporate travel has been severely cut back due to the economy. “But there is hope on the horizon,” McQuade added. “We are already seeing both large and small groups book for 2010 and the Capella has certainly been of primary interest for many of these group leaders. The Capella has also helped the group effort in giving customers more options, and the destination the ability to accommodate larger groups.”

Once a Muddy Parking Lot

The Telluride Mountain Village Owners Association, then called Mountain Village Metro Services, quietly acquired the bulk of the property now occupied by the Capella in the fall of 2000, precisely with the objective of ensuring it would be developed as a hotel, and that it would incorporate other needed community amenities, and would not be developed as condominiums. Then, as today, there was a concern, expressed at that time by Telluride Ski and Golf Co. CEO Ron Allred and expressed today by current Telski CEO Dave Riley, that creating bedbase is essential to the region’s economic sustainability. But the last remaining sites in Mountain Village and Telluride that were suitable for hotel development were being developed instead as condominiums, which generally have a far lower occupancy rate than hotel rooms do.

Metro Services subsequently entered into an agreement with Robert Levine, who developed the adjacent Inn at Lost Creek, to take on the project. There were then hundreds of hours of public meetings to hammer out details of the project, specifically how big it would be and what it would include.

Twice in 2004, as the project neared final approval, Mountain Village voters rejected arguments that the project was too big, first defeating a measure (with 73 percent opposed) that would have restricted the town council’s ability to award height variances and the second defeating a measure (80 percent opposed) that would have overturned the town council’s final approval of the project. The project also survived a legal challenge from the developer of the neighboring Franz Klammer Lodge.

After all of that, what was long a muddy parking lot at the center of the Mountain Village Center, and was once the location for trailers where lift tickets were sold and skis and boots were rented, is today a complex of two large structures containing 100 hotel rooms, 48 condominiums, two restaurants, a ballroom, a spa, new retail space, an underground parking garage, and an ice rink in a new public plaza.

The Capella Telluride is the first Capella hotel to open in the United States, the American flagship of a new international luxury brand founded by Horst Schulze, the legendary founder of the Ritz-Carlton Hotel chain. Capella hotels will be less formal than Ritz-Carltons, somewhat smaller in size, and will deliver an even more highly personalized level of service, Schulze has decreed.

For example, each Capella guest will have the use of a “personal assistant,” who will first contact them even before they arrive to determine the guests’ interests and to begin making arrangements for their stay. Rather than a grand public lobby, the hotel has a “living room,” whose access is restricted to hotel guests, where the personal assistants maintain their desks. The two restaurants, Onyx, featuring fine dining, and the Suede Bar, with a more casual menu, are open to the public.

New staff was busily training this week, as an army of construction workers scurried about to meet the deadline for today’s opening, with Schulze, who began his career as a waiter in his native Germany, on hand to personally lend a hand. The hotel has a staff of about 100 people, about half of them recruited locally, Volponi said.

“It’s all about service,” Volponi said, and indeed this reporter and a photographer were greeted warmly as we toured the facilities. “‘We, the service professionals of Capella place our guests at the center of everything we do,’” Volponi added, quoting an excerpt from the company’s “service training” that is reviewed with all employees.

“I think that sums up our philosophy. The significant idea that is emphasized over and over again in our training is that we provide ‘warm and caring service.’”

The Capella Telluride is offering an introductory rate of $295 this winter and for much of next summer. In an interview a year ago, admittedly before the scale of the current economic downturn was clear, Schulze expressed confidence that the Capella would be successful within three years, building that success on his philosophy emphasizing guest, employee and owner satisfaction, and commitment to community.

The hope expressed by Schulze then and by Volponi this week is that the Capella will someday be as strongly identified with Telluride as the Little Nell is with Aspen, the Sonnenalp is with Vail, and the Hyatt Regency is with Beaver Creek.
Comments-icon Post a Comment
April 24, 2009
A week in a one-bedroom (not including breakfast), prices out at $5K, incl. tax, in June. Ouch.
Bill Schiffbauer
February 12, 2009
Seems to me I heard all these comments when the Doral came to town.
FOM nli
February 11, 2009
--- Hotel occupancy in the Telluride region was down 17.5 percent in January compared to last January, with revenue per available room down by an even more impressive 30 percent, due to falling room rates. Advance bookings for the next six months are down by a whopping 32 percent compared to last year at this time ---

What happened to the need to increase the bed base at LIFT 7 ?!?!?!?

With numbers significantly down, why don't we still hear the clamor from the vocal few for the Town of Telluride to run roughshod over existing covenants in order to hand Telski and upzone to increase the bed base?