The Athénée Palace hotel in Bucharest, Romania, now a Hilton, may have been Europe's most notorious den of spies in the years leading up to World War II, and only slightly less so during the Cold War.
Located in the heart of Bucharest on Str. Episcopiei at the corner of Calea Victoriei on the former site of the Han Gherasi (Han is Romanian for "inn"), the hotel faces onto the small park in front of the Romanian Athenaeum on Revolution Square (originally Athenaeum Square, then Republic Square). It did not originally face onto a square: at the time the hotel was built, the space that is now a small park was occupied by the Splendid Hotel, destroyed by bombing 24 August, 1944, and there were a considerable number of other buildings on what is now the square.
Describing the hotel as it looked in 1938, A. L. Easterman of London's Daily Express and later of the Daily Herald referred to its "heavily ornate furnishings, marble and gold pillars, great glittering chandeliers, and the deep settees placed well back in the recesses of the lounge as if inviting conspiracy.
New York Times foreign correspondent C. L. Sulzberger wrote in his memoir A Long Row of Candles that as World War II was approaching, he settled into the Athénée Palace "to enjoy my wait for war… 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. "Countess" R. G. Waldeck wrote of the hotel in the same era, "Here was the heart of Bucharest, topographically, artistically, intellectually, politically—and, if you like, morally. It was also home at the time to both British spies and the Gestapo. A. L. Easterman called it the "most notorious caravanserai in all Europe. …the meeting place of the Continental spies, political conspirators, adventurers, concession hunters, and financial manipulators.
In 1948 the hotel was nationalized by the new Communist government, who famously bugged every room, tapped every phone (and every pay phone within half a mile), and staffed the entire hotel with informers. Dan Halpern writes, "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 external intelligence organization. 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 government-run Athénée Palace closed in 1994 and was bought at auction by Hilton International, who proceeded to do a $42 million renovation and expansion, reopening the hotel at nearly twice its former size in 1997, adding conference rooms and a business center.