OCEANSIDE — City Council unanimously approved a disposition agreement that outlines conditions for development of a beachfront resort on June 17. The agreement OKs $26.61 million in repayable bonds and a 75-year lease with a 24-year option between the city and S.D. Malkin Properties Inc. for 12 parcels in the downtown redevelopment area between Pier View Way, Myers Street, Seagaze Drive and Pacific Street.
S.D. Malkin will develop a destination resort on the 12-parcel site that includes a 283-room main hotel, a 48-room boutique hotel, a 47-unit timeshare project, a ballroom for 500, commercial retail space and a 503-car underground parking structure.
“Tonight is the golden step,” Kay Parker, an Oceanside resident, said. “This is the one where it all comes together. We’ve gained the approval of the Coastal Commission, a blueprint for financing and a way to go forward.”
The beachfront resort will give the downtown area a significant facelift. The OK includes setting a high bar on the standard of quality the resort must meet. The beachfront resort should be equal in quality to the Coronado Bay Resort and Hilton Waterfront Beach Resort.
The agreement includes a complex finance package of repayable bonds, property tax increments based on the transit occupancy tax generated by the resort, and contingency plans for builder and lender failure.
The approval allows other downtown redevelopment projects, like the CityMark project, to move forward and made it a good night for downtown developers.
“I came to the council meeting tonight looking for some happiness,” Nicolas Author, president of the Landbourn Company, said. The Landbourn Company is bringing the CityMark project forward. “We can’t move ahead until the Oceanside beach resort is a hole in the ground.”
“It took a lot of hard work, four years to keep driving it forward,” Jeremy Cohen, senior vice president of S.D. Malkin Properties, Inc., said. The next hurdle for development of the beachfront resort is securing $209 million in additional financing.
“The world is a bit topsy turvy now,” Cohen said. “We have to have a look at the big picture.”
“It’s a complicated deal, layering public finance,” Cohen said. “We keep our eye on the ultimate goal and we know how to take advantage of opportunities.”