The Athénée Palace in Bucharest was a hotbed of intrigue from the 1930's to the end of the Cold War. For Dan Halpern, the past still resonates.


Outside the hotel, the rogue cabdrivers line up lazily, hoping guests new to the Athénée Palace and to Bucharest, Romania, will have forgotten to ask the concierge for a taxi. But in the lobby, everyone is busy: bellboys and businessmen hustle about, contributing to the creation of the mighty New Europe.

No one leans in close and says, "The monkey hunts at night."

No one whispers, "The Germans have made you. Head to the safe house until you hear from your contact."

No one suggests, "I have the documents you are seeking. Put the money under the third chair from the left in the bar."

It's only slightly disappointing.

The safe, businesslike environment of the Athénée Palace Hilton is far removed from the Athénée Palace of the thirties and forties, which was the stuff of Eric Ambler and Graham Greene and Orson Welles, pure Eastern European noir. Indeed, more than any other, the Athénée Palace hotel epitomized the intrigue of the interwar period. But there's more: the noirish atmospherics continued, flourishing amid Cold War machinations—all the rooms were bugged—and a brutal dictatorship. More recently, the hotel, bought and renovated by Hilton in the nineties, has represented the aspirations of a new Romania.

For decades, then, this opulent Bucharest grande dame has claimed as central a place in a country's history, perhaps, as any hotel in the world. It sits atop Revolution Square, formerly named Republic Square, and before that Atheneum Square, the plaza that served as the center of Romanian political theater throughout the 20th century. The square is the fulcrum and the focus of Bucharest, bisected by the city's main boulevard, the Calea Victoriei. King Carol II shaped the square in the thirties to provide a site for a protective field of fire around his palace, to defend against a revolution, and Nicolae Ceausescu gave his famous last speech—with the extraordinary, visible moment of his sudden shocked understanding that the game was up—in December 1989 from the low balcony of the Party headquarters. Today, traces of the past can still be felt everywhere in the hotel, despite its modernization, despite the removal of all of the bugging devices, despite the modern, New Europe pose.

The building of the Athénée Palace began in 1912 and was completed in 1914; when World War I began, it had 149 rooms, 10 suites, and a restaurant. Designed by the French architect Théophile Bradeau, the hotel had a French fin de siècle look, an international staff, and, soon enough, a reputation. During the interwar years, and especially in the early stages of World War II, it provided the perfect venue for a short era of hard-drinking, devil-may-care decadence before the storm. "Bucharest was delightfully depraved," wrote New York Times foreign correspondent (and nephew of publisher Arthur Hays Sulzberger) C.L. Sulzberger, and so, he noted, "...I moved to the gaudy Athénée Palace to enjoy my wait for war." It was a good plan. "This was a comfortable establishment with excellent service...a corrupt staff always seeking to change a customer's money at black-market rates, and continual competition by ladies of easy or nonexistent virtue to share the warmth of a client's bed," Sulzberger wrote in A Long Row of Candles, his memoir of the years 1934 to 1954. "One night when I discreetly tottered home with an actress of my acquaintance, I found, to my embarrassment, a handsome young chambermaid sleeping peacefully on my pillow."

The war sobered things up a bit, but not all that much. Journalist R.G. Waldeck, a Jewish German-born American citizen possessing an ability to ingratiate herself with almost anyone, an entirely unsentimental view of the world, and, as far as anyone knew, a phony title (she called herselfCountess Waldeck, noble by marriage, but no one ever seems to have found a count attached), observed from her first-floor room that in 1940 the hotel was the last best place to view the clash of the old order and the new. "Here was the heart of Bucharest," she wrote, "topographically, artistically, intellectually, politically—and, if you like, morally." Neutral Romania, tugged by the Allies in one direction and the Germans in another, became the setting for the last breaths of Balkan European culture, with the Athénée Palace as its microcosm.

The place was lousy with spies, not to mention ministers and diplomats and industrialists and the occasional fugitive king, and not to mention gigolos living on blackmail and dangerous ladies in silver furs, and certainly not to speak of journalists. Indeed, the hotel's strategic location drew scores of British and American writers, who saw Bucharest as an ideal vantage point from which to watch the developing war. British intelligence was there in force, Gestapo agents were all over the joint, and the spies of King Carol II's police chief were crawling out of the closets. They hung around the plush English Bar, they hung around the lobby, and they gossiped, chattered, whispered, cajoled, threatened, extorted, and misinformed.

After surviving an occupation, an earthquake, and two bombings, the hotel underwent repairs and reopened after the war in a new incarnation. The Yalta Conference had put Romania within the new Soviet empire, and by 1947 the nation had been declared a People's Republic. The Athénée Palace was one of the first major projects of the postwar regime's espionage program: it was nationalized in 1948 and, with the oversight of a KGB advisor, extensively remade into an intelligence factory.

Bugs were installed in every room. The phones were tapped. In the café and the restaurant and the bar, even the ashtrays were said to be equipped with microphones. The busboys were watching; the waiters were listening. In the lobby, the bellboys and the concierge and the receptionists were all on the government payroll. Outside, the cabstand was run by the Securitate, Romania's secret police under Communism; every pay phone within a half-mile of the hotel was tapped.

That is to say, it was a thorough job. The hotel's general director was an undercover colonel in the Securitate's Counterespionage Directorate; the hotel's deputy director was a colonel in the DIE, the Romanian CIA. The doormen did surveillance; the housekeeping staff photographed all documents in the guests' rooms. The prostitutes in the lobby and in the bar and in the nightclub reported directly to their employers; the free-speaking bons vivants and Romanian intellectuals hanging around the café, not to mention a number of the guests, had been planted.

The Athénée Palace was a prototype, and soon enough the other hotels in town followed suit. Everyone knew—except, presumably, the guests.The novelist Norman Manea, who left Romania in 1986, recalls with amusement hearing the story of a Frenchwoman checking into a Bucharest hotel in the eighties: "'Excuse me, I have a request,' she says to the Securitate agent working as a receptionist, 'I've been told there are microphones in the rooms. Would you be so kind...could I have one without?'"

The Cold War was good, obviously, to the spy trade, and the spy trade was essential to Ceausescu, who lived in luxury while his people lived in misery. It was widely believed that one in four Romanians was somehow complicit with the Securitate, either as an employee or informant. Manea says Romanians would joke that in a family of four you had to ask, "Which one of us is the guy?" (The real ratio was probably more like 1 in 20.) The assumption was that anything you said, anywhere and at any time, could be overheard, recorded, processed, and of course, punished. Furthermore, according to the former spymaster Ion Pacepa, who, after years as one of Ceausescu's top aides, defected to the United States in 1978, the theft of Western technology had become "the single most important component of the country's economy" by the time he fled.

In 1994, a few years after the supreme leader's downfall, the Athénée Palace closed its doors. It was sold at auction; Hilton International began a $42 million renovation in 1995, reopening the hotel in 1997. Expanded to 272 rooms (including five presidential suites), the Athénée Palace Hilton resembles the old hotel fairly closely, despite a healthy dose of modernization. The famous English Bar, dimly lit and full of plush red couches, is more likely to contain young American businessmen with the beginnings of wealthy waistlines than it is to hold femmes fatales eliciting state secrets.

But the future has arrived in Eastern Europe—at least in its cities—and the Hilton iteration of the Athénée Palace is ready for it, with conference rooms, a business center, a beauty salon, and numerous restaurants. Foreign investment has lagged in Romania, far behind the success stories of Poland and Hungary, for example, but the country joined NATO in 2003 and is set to join the EU in 2007. Perhaps a little like the Warsaw or Budapest of a decade ago, it's a strangely contorted city, a head looking forward and a body facing backward. For Romania is still a country mostly populated by citizens who grew up not knowing if they had any secrets to themselves. Today, Romanian businessmen tend to take the chip out of their mobile phones when they want to talk about a deal privately—cell phones are particularly easy to bug, and you can never be sure who might be listening. They may just be paranoid. But it's also possible that they know something we don't.

Athénée Palace Hilton Bucharest, 1–3 Episcopiei St., Sector 1; 800/445-8667 or 40-21/303-3777;; doubles from $325.

DAN HALPERN has written for Colors, the New Republic, and other magazines.

Athénée Palace Hilton Bucharest