Coastal Commission won’t appeal port approval of new Harbor Island hotel

Approval last month by San Diego port commissioners of a long-planned hotel on Harbor Island will not be challenged by the California Coastal Commission, which at one time had insisted on formally weighing in on the $160 million project.

The proposed hotel, which is being developed by Sunroad Enterprises, will be designed as two hotels in one — a 198-room extended-stay hotel and a 252-room limited-service property, varying in height from 12 to 15 stories. Sunroad, a longtime port tenant who has been trying to get a Harbor Island hotel built for at least the last six years, has yet to work out an agreement with a hotel brand. The port has previously asked that the operator be upscale, akin to a Marriott, Hyatt, Hilton or Swissotel.

When port commissioners agreed to grant Sunroad a required coastal development permit a month ago, Coastal Commission staffers were still weighing whether to appeal the decision, arguing that an amendment to the port’s master plan amendment was needed before the hotel project could advance.

Coastal planners and port staff have long been at odds over the issue of amending the port tidelands blueprint, and in an email sent to port staff before last month’s hearing. Coastal Program Manager Kanani Leslie reiterated the commission’s position, saying “We continue to believe a PMPA (port master plan amendment) would be the most appropriate process to address lower-cost overnight accommodations as well as incorporate the updated project details and associated public access provisions/mitigation measures into the (master plan).”

In an email this week, Leslie said the commission staff has not wavered from its position that an amendment should be processed before the Coastal Commission, but a decision was made nonetheless to not appeal “because the final coastal development permit approval included special provisions that address lower-cost overnight accommodations and public access, and was generally consistent with the Port Master Plan.”

Bowing to concerns raised by the commission, port commissioners last month agreed to a revised permit provision stating that the development of low-cost accommodations should take priority over paying a fee and should be located within the San Diego Bay coastal zone, preferably on Harbor Island tidelands. If an affordable lodging project were built, it would have to have, at minimum, 112 rooms, which is 25 percent of the Sunroad hotel’s 450 rooms.

Sunroad President Uri Feldman said last month that he would like to find a way to provide thelow-cost lodging. Alternatively, he still has the option of paying a $100,000 per room fee that would be applied to 25 percent of the total hotel rooms. That is substantially higher than the $35,000 per room “in-lieu” levy that Sunroad had proposed paying earlier this year.

The Sunroad hotel, which has not been named yet, should start construction in late 2023, the developer says. It will include a number of amenities, including a walk-up restaurant and bar area, swimming pool, jacuzzi spa, fitness center, retail space, conference space and a 15-foot-wide waterside public promenade. In addition, “mini destination areas” for the public will be developed, three of which will be located on the promenade.

Leslie said the Coastal Commission staff will continue to work with the Port of San Diego to make sure that policies related to the Sunroad hotel project like low-cost accommodations are included in the port’s Master Plan update. Well into an eight-year-long drafting process, the update is not expected to go before California Coastal Commissioners until mid-2023. Public input on the draft environmental impact report is due by Jan 10.