Designers Jarret Hedborg and Neil Korpinen channeled Bette Midler's Hawaiian heritage to create an irreverent oasis in Laguna Beach.

At a certain point, Santa Barbara designer Neil Korpinen deftly picked up where Hedborg left off, "fluffing" the house as Midler requested. He hunted down just the right bamboo lamps and framed old menu covers from the Matson Line ships, which used to run between Los Angeles, San Francisco, and Honolulu. In an inspired act of historical preservation, Korpinen laminated vintage Hawaiian shirts onto tabletops and cupboard doors. He found a big, bright braided rug for the living room floor that fit right in with the Hawaiian style, which blended so many cultures-the native, the missionary, the Far East- just like the Hawaiian population. For example, missionaries introduced quilting to the islands and then the natives made it their own. "Taking their designs from nature, the Hawaiians would lay a cloth out under a tree and trace the shadows," he explains.

Working with Midler was complicated because her busy schedule rarely allowed time for a real meeting. "Then one day she phoned and said, `Drop everything. We have to go to an estate sale in Beverly Hills,'" Korpinen recalls. "We pulled up to this Georgian house which had belonged to Ray Bolger. Not very promising. But when we walked out to the pool house there was this incredible tiki room, untouched since the 1940s, with bamboo furniture and grass cloth walls. We took home everything we could carry."

Both Hedborg and Korpinen were buoyed by Midler's innate sense of style, and the house reflects her carefree spirit. "This was one of the most magical spots I've ever lived in," sighs the ebullient actress, who held on to it for ten years, until she moved to New York. "I hated to sell it and I keep the memories close to my heart."