If the mention of Luxembourg conjures visions of banks, European institutions and a vague whiff of royalty, most people struggle to place the tiny country on a map.

The nation of 660,000 people is seeing a rise in leisure tourism, but has so far lacked the kind of destination hotels to match its reputation as a haven for some of the world’s biggest fortunes.

That’s about to change with the opening of Villa Pétrusse, an exclusive retreat in Luxembourg City that combines historical pedigree with fine dining and an interior design by Tristan Auer, known for his renovation of the Carlton hotel in Cannes, among others. 

The 19th-century listed residence, which features 22 rooms, including suites and a penthouse, reopened in mid-June following a painstaking five-year, 40-million-euro renovation. 

Its ornate reception rooms now house a gastronomic restaurant, Le Lys, helmed by local chef Kim de Dood, who cut his teeth at the Michelin-starred Saint Pierre in Singapore. His innovative menu blends traditional Luxembourgish cuisine with Asian influences. 

The renovation has been a labor of love for Arthur Carvas, director of development of the real estate division at private investment firm Compagnie Financière La Luxembourgeoise, which owns one of the country’s top insurance companies and bought the property in 2017. 

Previously a private family home, the storied villa and surrounding park had been abandoned for 20 years when he was handed the keys to the project. Now part of the Relais & Châteaux network, it is open to the public for the first time.

“The spirit was really how to respect this heritage, to give back this heritage to the people of Luxembourg, and then to build a hotel business around that,” Carvas says. “You can’t look at it in terms of profit. It’s about legacy.”

Ravaged by dry rot, entire sections of the building were taken apart stone by stone and rebuilt. Centuries-old underground passageways, remnants of the former city fortress known as the “Gibraltar of the North,” now house a wine cellar.  

“Some of the artisans who worked here also worked on the restoration of Notre-Dame de Paris,” Carvas says during a tour of the premises. 

Traces of the Past

Far from erasing signs of the renovation, Auer wanted to celebrate it. 

In the former boudoir of the lady of the house, now part of the Suite Pétrusse, a section of woodwork shows off the successive layers of paint uncovered during the construction works. On the walls hang Éric Chenal’s atmospheric photographs of the villa in its raw state. 

“What’s interesting is the process, more than the end result. If you don’t show how it was done, you miss out on the emotion,” Auer says.

The overall decor is faithful to the history of the house, which was built in 1880 by architect Pierre Kemp for textile industrialist Eugène Kerckhoff. Its private park, overlooking a verdant valley, was the work of French landscape artist Edouard André, who also designed the city park across the street. 

Some of the original wallpapers were scanned and reprinted, while headboards feature large-scale reproductions of watercolor landscapes by Sosthène Weis, the Luxembourgish painter whose works are on display at the National Museum of History and Art.

For Auer, designing is all about the personality of the space. “For me, a hotel, a building, is a character. In this case, I felt it was more of a male character,” he says. 

With their grand neo-Renaissance chimneys and imposing chandeliers, the reception rooms were designed to impress. “The public areas are a bit like being on a theater stage,” he says. “So they had to be a little grandiose, a little intimidating too.”

The rooms retain a sense of intimacy, despite the addition of bathrooms, which were built into box-like structures to preserve the heritage site.

“It’s a restoration, so obviously there are elements that have to remain historical, but nevertheless it’s not a pastiche, as it has to be fit for modern use,” Auer explains. “It’s a complex and delicate alchemy and above all, you must not feel the hand of the designer.”

The service is designed to make visitors feel at home. “This is not one of those 200- or 300-room hotels where you feel like just a number. Here, it’s more like you’re a guest at someone’s house,” Carvas says.

A Little-known Culture

De Dood has elaborated dishes based on homegrown specialties like kniddelen, small dumplings made from flour dough that are usually served with bacon. In his haute version, they come in a velvety morel and yellow wine sauce.

The chef notes that Luxembourgish cuisine is deeply rooted in the country’s farming past, with simple, comforting fare based on locally sourced ingredients. 

“You have to enhance it with a little gastronomic touch, but the soul of the dishes must remain intact,” he says, adding that he hopes to encourage guests to explore the local culture. “We’re a very small country, but with a lot of things to discover, not just in terms of food.”

Luxembourg’s attractions include picturesque castles, vineyards on the Moselle river, and cultural institutions that include a contemporary art museum designed by I.M. Pei — all easy to explore thanks to free public transport, a world first. 

And next October, public celebrations will spotlight the country’s monarchy, as Crown Prince Guillaume succeeds his father Henri as Grand Duke.

Sebastian Reddeker, chief executive officer of the Luxembourg for Tourism authority, says the sector had its most successful year ever in 2024. Arrivals were up 16 percent compared with 2019, the previous record year, and are on track to increase by 4 percent in 2025. 

Of these, two-thirds were leisure tourists, with residents of neighboring Belgium, Germany and France flocking to the countryside for its scenic hiking trails. Investment has been poured into campsites, which now offer glamping options, and the government is working on a wine tourism action plan. 

In the capital, the Marriott chain is about to open its first prestige hotel opposite the central train station. But there’s still a gap between potential demand and offer in the high-end segment, making Villa Pétrusse a welcome addition, Reddeker says. 

“For Luxembourg, it’s high time to have these kind of locations,” he says. “We need more on the five-star segment, more individual concepts, perhaps also some of the luxury brands that bring their own clients.”

Hermès, Louis Vuitton and Chanel are among the brands with stand-alone boutiques in Luxembourg, which also counts 11 Michelin-starred restaurants. Its residents are fluent in Luxembourgish, French and German, and usually speak English, too, making it a welcoming place for travelers. 

Reddeker notes that while Luxembourg scores high on quality, safety and reliability, the overall vibe is more down-to-earth than other European capitals like Paris or Brussels. 

“Even if you’re seeking something luxury, you should be ready to feel the Luxembourg pulse, which includes meeting people, getting out, being on the streets,” he says. 

This summer, the city is hosting public events including the open-air Luxembourg Urban Garden exhibition, a Summer in the City program including a free outdoor concert by the Luxembourg Philharmonic, and the annual Schueberfouer fun fair.

Carvas remarks that while Luxembourg has always been open to other cultures, including the majority of foreigners who work on its soil, it has struggled to project its own personality. He hopes Villa Pétrusse will provide a glimpse of local hospitality, beyond the “tax haven” stereotypes.

“We are very welcoming, but we also like to be ourselves,” he says. “We’re just waiting for people to get to know us better.”