André Balazs plans to convert hotels into private clubs

The coronavirus may have made travelers wary of staying in a hotel with strangers, but hotelier André Balazs is betting that private clubs with familiar clientele will be able to overcome some of these concerns.

Balazs is planning to convert Los Angeles’ historic Chateau Marmont into a members-only model by the end of this year, and may then introduce the concept in other cities like Milan, Paris and Tokyo, the Wall Street Journal reported.

While the 63-year-old hotelier said he had been considered such a move for the past three years, coronavirus has accelerated those plans. “There is something to be said for knowing people,” Balazs told the Journal. “You can chat with them; you know where they have been.”

Another idea under consideration is the sale of ownership stakes in Balazs’ properties to guests who become club members.

Balazs also owns the Mercer Hotel in Lower Manhattan and the Chiltern Firehouse hotel in London. He sold the Standard High Line for $400 million in 2014 and stepped down as chair of the Standard hotels brand in 2017.

The Chateau Marmont in West Hollywood, long popular with actors and musicians, laid off nearly all of its employees in March while only providing them with health benefits until the end of the month. Balazs later donated $100,000 to an ex-employee fund, a spokesperson said.

While many hotels have considered alternative business models as a result of the pandemic, lodging analysts told the Journal that few would be able to pursue the same approach as Balazs, whose hotels already have a dedicated clientele and function like private clubs in many ways already.

“We have always screened our guests,” Balazs said. “Guests are never more than one degree of separation away.” [WSJ] — Kevin Sun