Best Budget Grande Dame
Before the ascendancy of Singapore and Hong Kong, Penang, a 285-sq-km island off Malaysia's northwest coast, was the fulcrum of trade in Asia. It was extracted under a spurious offer of military protection by Captain Francis Light, a British merchant looking to get rich, from the Sultan of Kedah in 1786. By the time the Sultan realized he'd been hustled, it was too late. Penang was declared a British crown colony, and some 34 years before modern Singapore was founded, its harbor was where China clippers could repair their sails, stock up on hardtack and grog, and catch the monsoon winds that blew them between Calcutta and Canton with hulls full of tea and opium.
Penang grew so prosperous that in 1885, two Armenian entrepreneurs built the luxury Eastern & Oriental Hotel along the promenade of Georgetown, the state capital. Based on its success, the duo founded Raffles in Singapore two years later. In architecture and history, the onetime sister properties and that other great colonial hotel, the Peninsula in Hong Kong have much in common, but there is one poignant difference. While Raffles and the Peninsula are in thriving centers of commerce, by the early 20th century Penang had been eclipsed as a trading force. A late burst of investment in electronics manufacturing in the early 1980s has also sputtered out. For travelers, though, that's a good thing: it means that guests of the 101-room E&O can enjoy genteel pleasures, like breakfast on the seaward veranda, at prices a fraction of those in hotels that are in luckier locations and without any diminution of romance.