InterContinental returning to San Diego
A 19-story hotel planned for the southern portion of Lane Field will mark the return of this hotel brand, last here in the 1980’s. (John Portman and Associates)
San Diego will see the return of long absent InterContinental Hotels & Resorts, with the development of a new 400-room hotel on the waterfront in downtown San Diego.
The 19-story, $218.7 million hotel had been long planned, but it was only recently that the development team finalized plans with InterContinental to operate the luxury property.
InterContinental, which has a presence in only three other California cities, was last in San Diego in 1987, when Marriott took over what is now the Marriott Marquis San Diego Marina.
The project is planned for the northeast corner of West Broadway and Pacific Highway on Lane Field, site of the former ballfield where the minor league Padres played until 1957.
While conceived a decade ago as part of a project calling for two hotel towers totaling 800 rooms, the severe economic downturn intruded and altered plans for the Lane Field development.
A long-term 66-year lease for the hotel site, which sits on public tidelands, will go before San Diego port commissioners on Tuesday. Anticipated lease revenues to the port are expected to total more than $42 million over the life of the lease, with initial yearly payments ramping up to $2.4 million in year 10.
Under the lease, the San Diego Unified Port District is entitled to a percentage of hotel revenues, including 3 percent to 5 percent for food sales and 7 percent to 9 percent from hotel rooms.
Construction is expected to break ground by the first of the year and be completed by early 2018, said Alex Guyott, who is managing the project for the development team of Robert Lankford, Portman Holdings, and Hensel Phelps.
The same developers are already in the final stages of construction of a dual-branded 400-room hotel rising on the northern portion of Lane Field. Designed as a two-wing, 17-story building that links a 253-room SpringHill Suites and a 147-room Residence Inn by Marriott, it is expected to open in late February, Guyott said.
Helping fund Lane Field South is China Orient Asset Management, a state-owned financial institution wholly owned by the Ministry of Finance of China. It will initially be responsible for providing nearly 90 percent of the project’s equity, although it hopes to significantly reduce that ownership stake over time by selling off portions to limited partner investors, according to the port’s staff report.
Guyott said he expects that a four-star hotel of InterContinental’s caliber will attract both leisure and business travelers. Locals may also be enticed to visit the hotel’s planned sky bar, which will be located on the 19th floor, overlooking the bay.
“It’s a sought-after brand and will be the only InterContinental in San Diego,” Guyott said. “We think Lane Field South is an ideal site for an InterContinental, with it being on the waterfront.”
Although InterContinental is not as well known among U.S. travelers as other high profile upscale hotel operators, it does have cachet among international travelers, said Alan Reay, president of Orange County-based Atlas Hospitality Group.
“The InterContinental coming to San Diego obviously speaks volumes in terms of the demand they see for higher end travelers coming to San Diego,” Reay said. “The clientele they position themselves for is definitely an upper end traveler, in the same category as the Manchester Hyatt or the Hilton and Marriott on the bayfront.”