Almost instantly, the 50-year-old luxury lodging mogul became the subject of widespread speculation:

Was Mr. Balazs somehow involved in the contentious coup d’état that deposed beloved longtime Chelsea Hotel manager Stanley Bard?

And, if so, what sort of Balazsian schemes awaited the iconic brick inn?

Would the famously shabby chic “rest stop for rare individuals” soon be refashioned along the more luxurious lines of Mr. Balazs’s hugely ballyhooed Hollywood retreat, the Chateau Marmont?

Imagine the bohemian enclave’s irreverent artworks and mismatched furnishings tossed for wicker chairs, Persian rugs, and 24-hour shoeshine service!

How would the Chelsea’s many resident artists afford the higher rents? Shining shoes?

“If he’s a smart hotelier, he should change very little,” warned one prototypical artsy hotel tenant during a recent conversation with The Observer. “The hotel is cooler than him. If he’s a smart guy, he’ll realize that or else become some kind of pariah.”

An even smarter guy might just avoid altogether the messy, contentious situation—described by one eloquent resident as “the real estate equivalent of the military quagmire in Iraq,” given its warring owners and unusual arrangements with its half-tenant, half-transient inhabitant sects.

With respect to the enduring conflict, the suave Mr. Balazs seems to be sticking to covert operations at present. (He politely declined comment for this story.)

A co-owner of the Chelsea Hotel emphatically denied his involvement. “André Balazs is not involved in any way with the Chelsea Hotel,” hotel heiress Dr. Marlene Krauss told The Observer.

At least not yet.

The hotel’s board of directors has, so far, publicly enlisted only two of Mr. Balazs’ old associates, Richard Born and Ira Drukier, to oversee the day-to-day operations of the business. Mr. Balazs previously partnered with the two BD Hotels honchos in 1997 to open the high-end Mercer hotel in SoHo.

Despite the persistent rumors of a mini-Mercer reunion at the Chelsea, there is still no official agreement with Mr. Balazs, though sources close to the new management team have confirmed that the trio has engaged in discussions.

“He’s a friend of BD Hotels,” Dr. Krauss told The Observer in a prior interview. “I’m sure they wanted to hear what he might do [with the hotel].”

One of three voting members of the hotel’s hotly divided board of directors—who, in the aftermath of Mr. Bard’s controversial June ouster, has emerged as the spokesperson for the building’s new order—Dr. Krauss lately has been brushing off all kinds of rumors about the beleaguered landmark on West 23rd Street.

Another piece of unverified gossip, propagated by the blog Curbed.com, recently suggested that the entire 12-story building could soon be for sale, with a purported asking price of around $90 million—also denied by Dr. Krauss.

“The Chelsea Hotel is not for sale,” she told The Observer, echoing her earlier statement, “I have no desire to sell it.”

Given the hotel’s rigid corporate structure, she might not be able to.

“It’s a very restrictive corporation,” explained ousted manager Mr. Bard, who remains the company’s majority owner and previously refused to allow a sale, during a recent interview. “They wanted to sell,” he said of rival co-owners and board members Dr. Krauss and David Elder; each one, like Mr. Bard, members of one of the hotel’s founding families. “Because of our restrictions,” he said, “they couldn’t sell.”

What followed was a contentious arbitration three years ago that ultimately wrested operational control from Mr. Bard’s family for the next seven years.

His temporary replacements, Mr. Born and Mr. Drukier, now carry some pretty big expectations.

“They were going to show [the board] that they could make more money, improve the hotel, and prove that the Bard family was not managing in their best interest,” Mr. Bard said.

Earlier this month, Mr. Born and Mr. Drukier announced that both occupancy and room revenue had already increased after just one month under their control.

But that says nothing of the far more daunting task ahead in the form of renovations to the building, built in 1883, which Dr. Krauss has said could run as high as $50 million.

Hence, the potential interest in Mr. Balazs, who may know a thing or two about restoring beloved old buildings to their former glory without offending too many aesthetic sensibilities.

This is the man, after all, who successfully relaunched the Chateau Marmont to rave reviews. It is no Chelsea Hotel. Instead of wrangling with multiple owners, Mr. Balazs commands ownership of the Los Angeles celebrity hideout himself.

But the comparison is unavoidable.

Mr. Balazs himself has often recounted the story of how the late fashion photographer and Chateau Marmont stalwart Helmut Newton warned him to not “fuck it up,” ironically as a spring on the old sofa where Mr. Newton was sitting burst from the fabric.

As the Chelsea’s ancient plumbing creaks and residents groan over looming changes, how much longer before Mr. Balazs officially joins the fray?