Oyster Point hotel project moves ahead in South San Francisco
Article originally appeared HERE on November 2, 2021
A new hotel is coming to South San Francisco’s Oyster Point, with the city last week agreeing to sell a 4.7-acre parcel on the Bayfront to a developer for the project.
Ensemble Investments LLC will pay $1 million for the city-owned site at 367 Marina Blvd., with plans to construct a 12-story, 350-room hotel. The project will now begin the entitlement process in which specific plans for the hotel are approved, and construction is expected to begin in 2024 with completion in 2027.
“The community benefits that are coming into our city, the tax dollars that are coming into our school district, it’s beneficial and it’s a game changer for us in South San Francisco,” Vice Mayor Mark Nagales said. “I look forward to the day we can do that ribbon cutting.”
The hotel is expected to bring in $194.1 million in taxes and fees to the city’s budget, $27.6 million to the city’s school district and $12.5 million to the county over the first 25 years. The revenue is largely due to the city’s Transient Occupancy Tax that collects 14% of room rental charges.
The site slated for the hotel is a capped landfill, decommissioned in the ’70s and approved for development as part of a comprehensive plan for the area in 2011. Other plans for the rehabilitated land include nearly 3 million square feet of office and biotech space to be spread across 10 buildings.
“It was a dirty landfill, and we’re looking at a proposed project to significantly transform this site,” Ernesto Lucero, Economic Development coordinator for the city, said.
Given the “existence and generation of methane, other landfill gases and other volatile organic compounds,” as described by the purchase agreement, the land was valued by the city at -$33 million. In turn, the city is committing to a 50% rebate on the TOT for the first 15 years, effectively reducing the hotel’s taxes by $44.5 million for that period.
The project has been in the works since at least 2018 when the city agreed to work exclusively with the developer. Multiple delays attributed to the environmental challenges of the site pushed the project well past original estimations of a 2019 groundbreaking.
Councilmember James Coleman agreed, and pointed to the benefits the hotel will bring to the area, including a lobby, grand ballroom, meeting space, restaurant and rooftop lounge that will be open to the public.
“I’m happy to see that there will be amenities that will benefit the public, and for many of the folks who do enjoy the Bay Trail, maybe a destination for them to stop at during their walk,” Coleman said.
Construction will also include improvements to a portion of the Bay Trail, and hotel grounds could eventually connect to the adjacent ferry terminal as part of a future Oyster Point transit hub.
“We’re thrilled that you accepted us,” Michael Moskowitz, Ensemble Investments managing director, said. “More important, we’re committed to delivering something excellent for the city.”
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