Hotel del Coronado May Help Fund Imperial Beach Hostel

Originally published 10:07 a.m. June 17.

When an expansion of the Hotel del Coronado was approved in 2010 the California Coastal Commission noted a lack of low-cost accommodations in San Diego's South Bay. 

As a condition of expansion approval the owners of the world-famous Victorian hotel were required to set aside a little over $1 million to go toward a future project that offers an affordable place to stay on the coast in South San Diego Bay.

A 50-bed hostel that has been proposed as part of the Bikeway Village project in Imperial Beach may qualify for some of that funding, said Diana Lilly with the Coastal Commission's San Diego office.

None of the money has been doled out yet, Lilly said.

Some form of additional funding is necessary for a hostel to be built at the Bikeway Village, said project manager Terry McCaleb.

"I would think for any hostel to work there something like that would have to happen," he said. "It's good to use [the money] close by to offset things instead of going clear out to Borrego Springs or something."

The Coastal Commission approved the Bikeway Village's coastal permit at a meeting in Long Beach Wednesday.

Proposed by property owner Rex Butler of Coronado with backing from the City of Imperial Beach, Bikeway Village LLC wants to convert two warehouses in the city's northeast corner. Commercial space with a community room, coffee shop, deck and fire pit would be completed in the first phase of the project. The second warehouse that may include a hostel would be built during the second phase of the project. 

Renovation of the warehouses could begin within a year, McCaleb said. 

The Imperial Beach Redevelopment Agency Successor Agency will contribute $1.8 million of the project originally expected to cost approximately $4.5 million.

The project's true cost and sources of funding will be revisited following approval of the project by the Coastal Commission, McCaleb said.

"I think we have to hit the next level of drawings and rebid and stuff to determine what the budget will be," he said.

Lilly said any project that wants part of the $1 million must be approved by October 2017 or the money will go into a fund to support affordable overnight accommodations in Southern California instead of Coronado or South San Diego Bay.

Whether the hostel is low-cost or high-end is yet to be determined, McCaleb said.

The future of current tenants in the 13th Street warehouse is uncertain. TNT Surf, who used to manufacture surfboards in the building, left the warehouse in 2011. 

Tony's Hotel Liquidators, a company that sometimes sells surplus Hotel del Coronado furniture said they don't know when or where they may move once the Bikeway Village is underway.

"We have absolutely no clue and we're terrified," said Tony's daughter Vanessa Tapia.

Tony's may be able to stay, McCaleb said.

"There may be another spot for Tony. We're not sure yet," he said. "He's been a good tenant."

Coastal Commission staff recommend the commission approve the project based on some conditions:

- Allow for a buffer between the project and the San Diego Bay National Wildlife Refuge.

- Final building and parking plans must be reviewed by the Coastal Commission's Executive Director.

- Use drought-tolerant native plants.

The Coastal Commission approved the creation of an ecotourism zone in IB specifically for the project in March.

As a result of a clerical error the Bikeway Village missed out on $500,000 in funding from SANDAG.