Gstaad Palace
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History of the Gstaad Palace Hotel Switzerland

The railway line from Montreux to Gstaad opens on 20 December 1904. Six months later the line is extended through to Zweisimmen. This marks the start of tourism in Gstaad.

The local secondary school teacher Robert Steffen (1878−1923) recognises the potential for a grand hotel on the Oberbort, Gstaad and buys the first parcels of land. A large part of the necessary funding comes from Steffen’s future father-inlaw.

Robert Steffen establishes contact with potential investors in the French speaking part of Switzerland. This leads to the founding of the “Royal-Hôtel & Winter Palace Gstaad” stock company in Lausanne on 15 December 1911. Steffen transfers the land he has acquired to the company, in return for an 18 percent stake.

In April 1912 construction work for the Palace Hotel begins on the Oberbort. Designed by the two architects Adrien van Dorsser (1866–1957) and Charles-François Bonjour (1870–1961), the project has a budget of 2.5 million Swiss francs, a very large investment.

The Palace Hotel opens on 8 December 1913, under the management of Albert Steudler and Hans Pünter. The hotel has 250 beds in 165 rooms, of which 70 have an en-suite bathroom. With a further 20 shared bathrooms, central heating and a hotel telegrapher the investors are aiming for luxury that will satisfy the highest demands.

The first winter season is so successful that a decision is made in spring 1914 to extend the hotel. A ballroom (now Salle Baccarat) is added onto the ground floor and is opened in the autumn of 1916.

During the First World War the number of guests decreases. The cost of coal for heating rises so sharply that the annual accounts for the war years are consistently in the red. In the summer of 1915 a tennis tournament is held in Gstaad for the first time. The aim is to attract additional visitors. The tournament eventually becomes the Tennis Open Gstaad.

With the hotel accounts still in the red, the board of directors dismisses Steudler and Pünter. Wilhelm Michel (1867– 1945), previously at the Hotel des Bergues in Geneva, takes over the management at the start of the winter season 1918/19.

Following a share capital increase in 1921 the Palace AG’s financial health gradually improves. The annual results for 1923 show a profit for the first time since WWI.

During the second half of the 1920’s the Palace blossoms, along with all hotels across Switzerland. Over Christmas and New Year, the Palace is fully booked on a regular basis. Increased investment is made in summer activities, to spread the demand on the hotel’s capacities.

The construction of a large outdoor pool and a first golf course are the joint projects of Gstaad’s hoteliers and tourist board. The pool and the golf course both open in July 1928. The main driving force is Wilhelm Michel, who is president of the tourist board from 1925 to 1931.

The world economic crisis is felt across the hotel trade. The strong rise in the Swiss franc against foreign currencies leads to a fall in the number of bookings at the Palace. New attractions are planned to draw in more visitors. The sleigh lift, or “Funi”, up Wispile mountain opens during the winter season 1934/35.

To cover losses, the share capital of the Palace AG is reduced. A true improvement in the situation finally occurs when the Swiss franc is devalued in September 1936. This has a direct effect: The number of visitors rises again.

Hotel manager Wilhelm Michel is set to retire in spring 1939. His successors Ernst and Silvia Scherz start in the autumn of 1938, to allow for a smooth management transition.

During the Second World War, the number of bookings falls by half. As a precaution, the Union Bank of Switzerland constructs an enormous vault and shelter under the terrace of the Palace Hotel. The bank’s management makes arrangements to relocate to the Palace if its business locations closer to the borders need to be abandoned. The vault serves to store gold, among other things.

After the war, the number of bookings rises sharply and returns to pre-war levels as early as 1947. The central heating system is fully modernised and switched from coal to oil combustion. This allows the Palace to half its heating costs in one swoop.

The founding congress of the Union parlementaire européenne, one of the most important forerunners of the Council of Europe, is held at the Palace in early September 1947. The congress is organised by Count Richard Coudenhove-Kalergi. For age-related reasons, the longstanding chairman of the board Joseph Diémand (1876–1952) sells his 45 percent stake in the Palace AG to the notorious speculator Kurt von Jahn, former owner of the Schlosshotel Hertenstein near Weggis. In Gstaad it is feared that the Palace might be closed down. With the support of Gstaad’s general practitioner Fritz Kaufmann (1892−1958) Ernst Scherz succeeds in raising enough capital to buy the shares back. Over the following years he repays all the investors, in order to fully acquire all shares.

Following a renovation the ballroom is renamed Chez Maxim’s. During the first half of the 1950’s numerous investments are made: The hotel foyer, the entrance, the bar and the restaurant Le Grill are all redesigned.

Henri Jolidon is hired as head chef. Together with Otto Schlegel, who has worked at the Palace as a chef since the winter season 1947/48, Jolidon brings about a significant rise in the gastronomic quality.

On 4 August 1957 the first Menuhin festival takes place in the Mauritius church in Saanen. The festival picks up on the tradition of the musical summer concerts, which were held in the Palace from 1942 to 1947, but which had to be abandoned for financial reasons.

Gala dinners with international stars are the highlights of the winter seasons during the 1960’s. On 15 February 1964 Marlene Dietrich performes at one such event. “One of the most illustrious occasions in the history of the Palace”, states the annual report. The list of celebrity guests is long and includes names such as Louis Armstrong, Benny Goodman and Ella Fitzgerald, Maurice Chevalier, Gilbert Bécaud, Dionne Warwick and Petula Clark.

Ernst Andrea Scherz joins the hotel on a permanent basis. In 1969 he takes over the management role from his father.

The indoor pool is built, along with outdoor facilities, a sauna and a “health centre”, as it was then called. Plans are also drawn up for a night club, to be housed in the same part of the building. This is intended to “confirm the Palace’s position as the centre of all cultural events in Gstaad”, the project concept states.

The night club GreenGo officially opens on 22 January 1971. The original furnishings by Teo Jakob remain largely unaltered to the present day, despite several gentle renovations.

At an extraordinary general meeting on 21 January 1974 the share capital of the Palace AG is restructured. In view of Ernst Scherz’s succession planning, voting shares are introduced to strengthen the family-owned character of the business. Ernst Andrea Scherz is made president of the alliance The Leading Hotels of the World. Under his leadership (to 1989) the consortium of leading luxury hotels expands to include numerous hotels outside Europe.

The former military shelter built during the Second World War is converted. The space is used to house La Fromagerie, which opens at the start of the winter season 1975/76. The film The Return of the Pink Panther, starring Peter Sellers and partly filmed at the Palace, celebrates its European premiere in Gstaad on 12 September 1975.

The longstanding chefs de cuisine Henri Jolidon and Otto Schlegel retire. Their successors, another duo, are Peter Wyss and Hugo Weibel.

The new restaurant Le sans cravate opens at the end of 1979. With no strict dress code, this provides a more relaxed alternative to Le Grill. In the same year, the indoor pool is refurbished and more closely linked to the GreenGo to enable pool parties.

At the start of the winter season 1979/80 the first occupants move in to the 21-apartment complex La Résidence The building is the result of a decade-long planning phase. The first project, launched in 1969, had to be shelved due to the crucial federal decrees relating to the economic downturn of 1972. In 1976 a redesigned version is given the go-ahead.

Numerous building alterations are realised during the second half of the 1980’s, starting with the extension of the Grande Terasse and the construction of the conference room Salle Piero.

The alterations are brought to a close in 1990 with the redesign of the forecourt and entrance, and an extension to the underground parking. The ballroom Chez Maxim’s is refurbished and renamed Salle Baccarat in readiness for the winter season 1991/92.

Andrea Scherz begins work at the Palace in the summer season of 1996, initially as chef de réception. This heralds the start of the third generation’s involvement in the company. Les Chalets du Palace are completed in the same year.

The first Gstaad-Symposium provides a framework for informal meetings with personalities such as Margaret Thatcher and Peter Ustinov. After the end of the cold war the series of talks – inspired by Spectator columnist Taki Theodoracopulos – reflects on the 20th century.

Andrea Scherz takes on the role of general manager at the start of 2001. At the same time the long-standing director Hansruedi Schaerer retires after 43 years of service. In December 2000 the spectacular penthouse suite is completed, followed by the tower suite in December 2001. Thierry Scherz co-founds the Sommets Musicaux de Gstaad, which will enrich the winter season with concerts on an annual basis.

The restaurant Le sans cravate is renamed Gildo’s, after the long-standing maître d’hôtel Ermenegildo Bocchini (Gildo). The Palace AG becomes a family holding.

The spa is redesigned and vastly extended. The new wellness area comprises 1800 square metres.

The Palace is linked to the district heating network Saanen–Gstaad. As the network’s biggest consumer, the Palace is an important patron of the project. The hotel itself and four neighbouring buildings are heated with renewable energy from locally sourced wood.

The Palace acquires a herdsman’s hut on the Walig Alp. The hut, built in 1783 at 1700 metres above sea, is carefully renovated and now provides guests with an authentic mountain experience.

Gstaad school classes plant new trees on the Bortvorsass, in a woodland that was ravaged by hurricane “Lothar” in 1999. Initiated by Andrea Scherz, the Palace funds the reforestation as a sustainable project to commemorate its 100th anniversary.

On 1 July Thierry Scherz dies unexpectedly. He leaves behind his wife Martina and his eigthyear-old twin daugthers.

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