Ty Warner Decides to Sell the Miramar Hotel

Fed Up With the Planning Process, Hotelier Abandons Dream Design

The most recent architectural renderings for the Miramar Hotel remodel establish a nostalgic scene of 1950s swank matched by family ambience, the kind of place where Frank Sinatra and Dean Martin would bring their kids. It’s a place with cabana compounds and glassy outdoor pools lined with blue-padded deck chairs and rangy boardwalks. But it’s a place that will only exist in ink and paper unless its owner, Ty Warner, decides not to sell the hotel.

Representatives of the hotelier told the Journal last Wednesday that Warner believed a remodel to the property, which he purchased for a little more than $42 million in early 2005, would be too costly – potentially as much as $300 million.

“His direction was up to this point to follow through,” said Greg Rice, executive vice president of development for Ty Warner Hotels & Resorts, LLC. “It was with great disappointment letting all of this work go without completion.”

During an interview at his office, Rice said Warner had grown increasingly dissatisfied with planning stumbling blocks that allow projects to get delayed and costs to increase while forcing applicants to acquiesce to the will of opposing minorities.

“In the end, you wind up with a project you didn’t want and you wind up making compromises that have nothing to do with your neighbors,” Rice said.

Rice singled out his strongest criticisms for the Montecito Association, which he said had been most resistant to Warner, despite staggering support for the hotelier’s projects from the Association’s membership.

“It seems that whatever we propose, they’re against it,” Rice said of the Association. “They alone are dictating how we complete our projects, not for the people of Montecito or their members, but for their own partial opinions – specifically against Ty Warner.”

Last week’s announcement ended several weeks of speculation about whether the hotel mogul would sell the Miramar, commonly asserted as the last vestige of Warner’s ambitious renovation campaign in Montecito. Rice has often complained on Warner’s behalf about the difficulties of getting a project approved in Montecito. The hotelier’s entire team had delayed making any disclosures about the Miramar until other Warner projects were settled.

In the latest designs, Rice said architect David VanHoy had prepared an upscale “family-oriented” hotel that departs from former Miramar owner Ian Schrager’s “edgy” resort and wouldn’t compete with Warner’s other high-profile properties, such as San Ysidro Ranch and the Four Seasons Biltmore.

VanHoy, who is working on Warner’s Coral Casino rehabilitation and the forthcoming Montecito Country Club remodel, had “gone through every single room,” Rice said, and had created plans for a new lobby, spa, restaurant, tennis courts, pools and additional landscaping.

“This was not an easy decision for Mr. Warner, as he shared the desire of so many local residents to see this iconic hotel brought back to life,” Rice wrote in a November 20 letter to supporters.

Warner has reportedly spent about $500,000 on architectural designs, on top of another $1 million he’s spent on minor hotel fix-ups. Rice didn’t say how much the Miramar was selling for, but that he expects the sale price to exceed what Warner paid for the hotel.

Last week’s announcement sent a wave of disappointment throughout Warner’s extensive legion of fans who saw him as the best candidate to rehabilitate a dilapidated 14-acre property that hasn’t been open since the summer of 2000.

“I think he’s someone who would honor the old Miramar,” said Deborah Clark, who claims she practically “grew up” at the Miramar during the ‘50s.

“It’s frustrating to think that someone who has such vision for that property would run into so many stumbling blocks,” she continued. “It’s a triple-edged sword when you come down to it.”

Battling Groups

Warner’s decision to sell is underscored by his company’s growing discontent with the Montecito Association. Relations between the two institutions have soured this year and Rice attributes the fallout to the Association’s leadership that “has gotten worse and worse and more aggressive toward Mr. Warner’s projects.”

For example, Rice points to Warner’s Channel Drive restoration this year, a project that drew large community praise but was opposed by the Association over safety concerns.

“What we’re saying is that a homeowners group should represent its membership,” Rice said.

Their relations worsened in August when the Association’s Land Use Committee supported a Montecito Planning Commission decision that imposed conditions on Warner’s Biltmore seawall repair. The two groups have since traded barbs in a number of letters written to the Journal and others circulated around Montecito.

Rice has always suspected the Association of wielding a “personal bias” toward Warner, and said he felt justified after he abruptly left an October 5 meeting with the Land Use Committee’s chair, Susan Keller. Rice had met with Keller and Joan Wells to discuss ways to find common ground. While on the subject of the Biltmore seawall repair, Rice said he told Keller that Warner was entitled to do work on his own property, to which she reportedly replied: “Yes, we know Ty Warner owns it, and that’s why we’re tired of him rubbing our noses in it.”

Association President Bob Collector admits that “the Association is not without fault in our relationship with Ty Warner,” but he’s said repeatedly that “personal bias is impossible” because the organization’s positions are decided by its 17 directors.

Collector said he was “dismayed” by Rice’s accusations because he said the Association rarely opposes Warner proposals. Despite the regular planning hassles, Collector said Warner has had no problems getting approvals.

“Everything he wanted to do to the Biltmore he got. Everything he wanted to add to the Coral Casino, the Montecito Planning Commission awarded to him,” Collector said. “I’m having a hard time trying to understand how someone can complain when they’ve won one hundred percent of their projects.”

But approvals don’t mean anything, Rice said, if they come attached with a list of conditions. He points to last year’s Coral Casino proceedings in which the Association endorsed the rehabilitation designs, but tacked on conditions for decision makers to consider.

“They have a very clever way of hiding their true feelings about a project,” Rice said.

As to Rice’s expressed reasons for selling the Miramar, Collector said they had less to do with the Association and more with escalating costs of construction materials and labor. He said he’s known as far back as August 20 that Rice had been approaching real estate investors looking for someone to buy the Miramar. Given Warner’s standards, a complete hotel remodel would have brought stratospheric costs, Collector believes.

“Nobody even knew how Ian Schrager was going to do a renovation when materials were not as expensive,” he said. “With all that Warner’s already spent, I can’t see why this would have been a good investment.”

What the Future Holds

When Ty Warner purchased the Miramar last year, he was immediately greeted as the savior of a downtrodden, neglected property. Many residents saw him as the only person in the County with enough money and patience to accomplish a renovation. Upon hearing the news of Warner’s decision, the billionaire hotelier’s friends and admirers wondered whether he was running out of patience.

“I wouldn’t say he’s fed up with Montecito, but I think he’s reached the breaking point,” said Nina Terzian, a Warner friend of 25 years.

Terzian, whose Montecito home faces Miramar Beach, doubted whether the hotel could ever be rebuilt. “If someone like Ty Warner, with his deep pockets, brilliant ideas for architecture and unbelievable perseverance can’t do it, who can?” she said.

“And why would anyone want to? I know I wouldn’t.”

Coast Village Complex Could be Heard by Planning Commission in Spring 2007

Within the next couple weeks, commercial property owner John Price will be submitting plans to the Santa Barbara Planning Commission for a conversion of his Coast Village Road 76 Station into a commercial and residential facility. Architect Jeffrey Gorrell, of Lenvik & Minor, said his three-story mixed use building will “give more grace to the street” and will be “in keeping with the Mediterranean style” of the primarily commercial area.

“We’re very proud of it. We feel it’s going to be a wonderful addition to Coast Village Road and worthy as a gateway to the neighborhood,” Gorrell said last week. “Aesthetically, this is an enormous improvement over the gas station.”

Gorrell said the plans could be turned in as soon as December 1 and a hearing before the Planning Commission would likely not take place until spring 2007.

Mr. Gorrell’s designs call for less than 5,000 square feet of development mixing eight residential units with two ground floor commercial spaces. The Spanish Colonial-inspired facilities would be accompanied by a parking lot on the northern portion of the property, in addition to an underground parking garage.

The entrance of the complex, perhaps the most ornate portion of the facilities, is an open arched doorway framed by stonework. The entry passes into a paseo that connects the commercial units and leads northward into the parking area.

The current designs differ immensely from plans that were introduced in February, when Santa Barbara Planning Commissioners expressed doubts about whether the mass and height of the building were incompatible with the neighborhood.

While the building will still stand at three stories, Gorrell said he addressed comments by pulling the infrastructure 10 feet back from Coast Village Road to reduce the overall size of the complex and limit the visual impacts.

“The units get smaller, of course, but that’s the way it needed to be, and that’s alright,” Gorrell said.

Working with landscape company Earthform Design, Gorrell also implemented more plantings, streetscape and a fountain all intended to bring more “life to the area.”

“This is all part of making the project feasible and sensitive to the needs of Coast Village Road,” Gorrell said. “I hope that I’ve addressed (the businesses’) interests as best as can be done without compromising the program of the owner.”

But for some Coast Village merchants, the changes may not be enough. Most of the building will measure at 35 feet with a tower at a height of nearly 41 feet. During a Coast Village Business Association meeting on November 17, President Danny Copus said his organization is finalizing a masterplan for Coast Village that limits building heights to 30 feet. Gorrell’s current design, he said, doesn’t fit into the business area’s plans.

“It’s still blocking a lot of the mountains,” said Copus, who is general manager of the Montecito Inn, directly across the street from the proposed development site. “We’re now looking at a project that’s thirty-five feet tall, and that’s just unacceptable.”

Other business operators, though, seemed quite satisfied. “It’s extraordinary the changes that have been made to address the impacts and the mass of the building,” said Chef James Sly, whose restaurant Lucky’s operates across the street. “I think it has to be a significant improvement over a gas station, even a very nice gas station.”

But the removal of the 76 Station is still worrisome for some Coast Village merchants and Montecito residents who say its elimination would leave the town with only two gas stations. These same concerns were raised in February, when Planning Commissioner Bill Maran suggested the removal of station could alter traffic trends and “increase the distance people have to go to get gas.”

But Gorrell isn’t worried, saying the end of the 76 Station is part of a trend of other gas stations that have met a similar demise. “In my mind, how many gas stations do you need?” he said. “We are losing gas stations all over the area. The reality is that they’re not very profitable and the margins for the owner are negligible.”