Wednesday, February 8, 2023

“Inn at the Cays” Continues to Push Proposal Despite Opposition

The proposed hotel and recreational area property is on the Grand Caribe Isle peninsula’s northern area, which is part of the state lands around the bay the Port holds in trust for the people of California due to the San Diego Unified Port District Act. The concerned portion of Grand Caribe land is currently leased to Cays Resort, LLC, which has control over the property leased to them but not development approval or the land and water use designation.

The Inn at the Cays proposed hotel, promenade and recreational area property is on the Grand Caribe Isle peninsula’s northern area and includes the current boat storage yard.

The Inn at the Cays proposal team is continuing to push despite opposition from the City of Coronado and some residents, as well as the Port of San Diego’s present rejection.

Proposed Site Plan – Image courtesy of the Inn at the Cays project development team.

The Port turned down the development team’s plan in June, but the team said they submitted a response to address the Port’s concerns; yet the Port responded the plan was still inconsistent with the Port’s vision. The team shared that they are working on a second response and meeting with the Port this week.

Janine Zúñiga, a senior management analyst for Coronado, reported: “The City has relayed its concerns to the Port and to residents. The City has always opposed development at that site and our concerns remain the same. The City would direct inquiries about the project to the Port.”

City Councilmember Marvin Heinze, who’s also a Cays resident, reiterated that directing inquiries and feedback to the Board of Port Commissioners is encouraged — and to all the commissioners, not only Coronado resident and commissioner Garry Bonelli. If against the proposal, Heinze advised residents to tell the commissioners: “Thank you for saying no, keep saying no.”

Heinze said weighing the transient occupancy tax (TOT) the City would receive from a second Cays hotel wasn’t a difficult scenario. He described how Coronado has many hotel rooms and TOT is part of the budget, but “we don’t do things in Coronado purely for money.”

The councilman said while they strive to make the community better overall — and while he reminded he’s just one voice on the council — the City isn’t desperate for money, TOT requires occupied rooms, and it would only be 114 available rooms compared to the numerous rooms already existing in Coronado.

Heinze said Coronado is fortunate that a large portion of the City budget is based on property taxes, which can rise with home sale values — which is almost always the case in Coronado. He added though TOT is significant, it’s much smaller and can also require additional costs for the increased public’s related expenses such as road maintenance and safety. Property taxes are what sustain the budget, he said, which is why the city isn’t presently in a revenue crisis.

Property tax annual revenue has been around $33 million, Heinze shared, with hotel tax around half that outside of a pandemic.

He touched on how the Port has many hotel rooms around San Diego Bay and is also looking to diversify Port income, he said — “another hundred hotel rooms is not spectacular to them; they’re in the business of getting income off properties,” and he highlighted how the Port has always tried to be good neighbors in past efforts.

The proposed hotel and recreational area property is on the Grand Caribe Isle peninsula’s northern area, which is part of the state lands around the bay the Port holds in trust for the people of California due to the San Diego Unified Port District Act. The concerned portion of Grand Caribe land is currently leased to Cays Resort, LLC, which has control over the property leased to them but not development approval or the land and water use designation.

For the Cays Resort leasehold, it presently allows for the development of hotels, restaurants and marinas, among other things, the Port said. But the lease also states any development must be consistent with the Port Master Plan, and the current proposal is inconsistent. The leased property designation is also potentially up for a change from Commercial Recreation and Recreational Boat Berthing to Recreation Open Space in the Port Master Plan Update, which has garnered input for around six years and will be finalized over the next couple years.

Presently the leaseholder subleases a portion of the lease at the north end to the Cays Yacht Club. The nearby gondola company and café are part of the Coronado Cays Homeowners’ Association (CCHOA) lease. Once the lease ends in 2034, the Port will decide whether to keep or remove the boat yard business, said the Port — which also requires a permit to be renewed every five years for the yard. The leased property is also beside the Grand Caribe Shoreline Park, which is in the Port’s jurisdiction as well and it “owns” the land as the trustee.

The proposed hotel would be beside the Grand Caribe Shoreline Park, which is in the Port of San Diego’s jurisdiction along the bay.

The Port explained the Cays Resort leasehold consists of approximately seven acres of land and 101 acres of water area in the Grand Caribe region. In March, Keith Mishkin — a representative of Cays Resort — submitted the Inn at the Cays proposal for a hotel with 114 rooms, restaurant and bar, marina, a public waterfront promenade, 127 off-street parking spaces, meeting rooms, as well as indoor and outdoor lounging and gathering areas.

Also in the proposal is an agreement with the Coronado Cays Yacht Club (CCYC) to provide joint-use areas which include additional boat slips, a refreshment area, an event lawn space, a new building for event support and a sailing outfitter.

The Port’s June response to the proposal expressed the following concerns with the development:

  • It is inconsistent with the Port Master Plan.
  • There is no evidence that it would fit into the community character and nearby sensitive resources.
  • Staff believes it fails to provide adequate public access and is too intense for the quiet nature of the surrounding areas.
  • Staff believes it is not in the overall best interests in the overall development of the bay.

The current leasehold ends in 14 years on May 19. The Port also has regulatory authority to make changes to the existing Master Plan at any time through an Amendment.

Additionally the Master Plan Update process doesn’t consider any specific project, the Port said. The Master Plan is a water and land use planning document which designates specific areas of the bay within the Port’s jurisdiction for a balance of uses consistent with the Port Act including maritime, recreational, fishing, visitor-serving commercial, conservation and institutional uses.

The Master Plan Update is being prepared, the Port said, and a discussion draft was released in 2019 for public review and input. The Port anticipates releasing a revised draft for public review in late 2020, then it will go through the environmental review process required by the California Environmental Quality Act, followed by processing with the California Coastal Commission — the final step for the update estimated to be complete in 2021-2022.

“As stewards of San Diego Bay, the Board carefully considers feedback from the public,” stated Port representative Tracy Spahr. “The Port of San Diego welcomes all feedback and invites concerned citizens, Port tenants, other stakeholders and the general public to attend meetings of the Board of Port Commissioners to learn about and connect with policy decisions that affect our dynamic waterfront.

“Agenda and meeting notes are available prior to every Board meeting. The general public may also subscribe to receive certain notices through the Port website. The Port also seeks feedback from the public and stakeholders through other public outreach forums.”

Image produced by Marta Carvalho Planning & Design; image courtesy of the Inn at the Cays project development team.

The proposal development team has presented to Cays residents and has been sharing how the project can enhance and bring in revenue for Coronado and the Port, while protecting and preserving the land. Mishkin and a fellow representative Patrick Batten said they truly want a win-win and encourage as much input as possible, conducting hundreds of hours of interviews with involved groups, consultants and residents.

In addition to removing the peninsula’s boat storage area, Mishkin said the design aims to be mindful, environmentally-responsible, quaint, include architecture inspired by the Hotel del Coronado, involve low height levels, be handicap accessible, as well as able to please those who are more anti-development with responsible development and a tremendous gift for the community. The imagined seaside village would have no gates to public access except for safety.

Mishkin discussed the $30 million project’s landscaping and sense of arrival, casual and intimate feeling, park areas, shops, dock ‘n dine, public gondola rental, youth sailing opportunities, more than double the required parking, shuttle services, 35% of the lodging being hero rooms at a discount for first responders and teachers, resident discounts, and a continuous promenade that adds to “the green necklace” the Port is trying to accomplish.

A real estate broker from Arizona — where he has a collection of high-end, award-winning hospitality property developments — Mishkin said he’s a long-term player and a long-term investor as well as sees the project as a legacy asset for his family. He has been coming to Coronado for 40 years, he said, his family staying at the Coronado Shores.

“Coronado is my happy place. It’s one of my favorite places to go,” Mishkin said, and he’s trying to understand what’s important to everybody — adding he wants the project to fit and wants to make one of the gems in San Diego Bay and the Cays even more of a gem. “Over 80% of people we meet with sign on for support… The support has literally been overwhelming.”

Image produced by Marta Carvalho Planning & Design; image courtesy of the Inn at the Cays project development team.

While there has been disapproval from groups including the CCHOA leadership and associated Grand Caribe Task Force Committee, the developers are planning to keep taking steps to try and move forward with the proposal. Mishkin said they don’t need the HOA’s support but really wants them on board, and he also wants to meet with them; he said with past developments he feels blessed to have had remarkable community support.

Batten described how if the Port proceeds with adjusting the designation unfavorably for the project proposal, the communication isn’t stopping with the Port.

“There’s an easier path and that’s what we’re seeking but it doesn’t change anything,” Batten said, adding they’re 100% moving forward.

Past projects, even if lower density as well, have fallen through. Yet Mishkin presented that if the community doesn’t want the inn completed, what could the plan be for the potential green, open space?

Mishkin mentioned it has been challenging to get in front of the whole community given the pandemic, but they have been using Zoom on a weekly basis and doing some in-person meetings as well — and the team is optimistic certain meeting restrictions will be lifted shortly.

“We’ve designed something that is a fraction of what it can support form a land standpoint and have a win-win,” he said, adding they want people to ask any question. “It’s something really important to me as a person… We care about the community.”

Twenty-year Cays resident Richard Herrmann was invited several times to the developer’s presentation and attended a few weeks ago at the CCYC. He listed what he saw as opportunities of the proposal:

1) Would possibly increase home values in the Cays because of exposure to guests who use the hotel; 2) Possible future security for use of land by CCYC. 3) Possible dedication of a parking lot to CCYC; 4) Use of hotel facilities and restaurant. 5) Elimination of a larger park area; and 6) Commodore Club discounts for the hotel and amenities.

He also mentioned the following loss: Greater use and crowds at existing park as hotel residents also use the park.

Other residents have expressed concerns over increased tennis court usage.

Another Cays resident, Daron Case, launched a petition with the Coronado Citizens Coalition recently, which quickly gathered around 300 signatures. (Access the petition here.) Case also spearheaded the Facebook page “No Hotel at Cays” and has submitted letters to Coronado publications.

The Grand Caribe Task Force worked to get the City Council to pass a resolution in May 2017 to keep the North Isle green.

In addition, at its meeting last week, the CCHOA Board unanimously confirmed its resolution from 2005 that opposed the hotel project put forward at the time. The resolution also stated it was the official policy of the HOA to oppose a hotel or other high-density project on Grand Caribe.

Kim Tolles, HOA board member as well as task force chair and board liaison, shared:

“Coronadans were so happy when our Port Commissioner stated recently that he has heard ‘loud and clear’ that the people of Coronado do not want any more hotel rooms on tidal lands, either at the Ferry Landing or here in the Cays, and that Port staff has been directed to incorporate no more hotel rooms into the updated Port Master Plan.”

Tolles added that residents will be reestablishing a nonprofit organization, a conservancy, that will be happy to work with this leaseholder, so that North Grand Caribe Isle can be part of the Port’s envisioned green necklace as well as a wonderful stop on the Bayshore Bikeway.

“Now that we have new, energetic people in the Cays who have gotten Audubon grants to restore the native plant garden at Grand Caribe Shoreline Park on the south end,” Tolles stated, they’ll also be working on a new conservancy to focus on the south end’s park and Port mitigation area as well as be ready to work on the north end with the Port through grants to purchase and plan.

The bayside coast in front of Grand Caribe Shoreline Park.

Brian Goelz, commodore of CCYC, said he believes in a democratic process that allows its members to decide what to support and what not to, and the board doesn’t speak for its membership at large. While the board remains non-oppositional as long as the proposal environment is supportive, he expressed the goal is to allow the development team and Mishkin to have a voice and take part in the process.

Goelz said Mishkin has done what they call essential meetings with CCYC members and the board, earmarked specific requests such as the bocce ball court — as well as focused on adding more land and water to the club plan, expanding the guest dock and creating joint-use of a selection of things. Goelz added he thinks Mishkin is a very conscientious, considerate and environmentally-conscious developer, and “he’s doing the very best he can to accommodate everyone’s needs.”

The commodore said if the resort goes through, the club is pleased Mishkin is working with them.

As the club is a longtime tenant, Goelz said Mishkin has been and is being a good neighbor. Goelz mentioned the club has some time before its lease is up for renewal. He also said most all members who have met with Mishkin have been supportive of the project and that a very small handful are anti-development.

The CCYC has almost 400 members with a little over half residing in the 92118 zip code. The club seems to be growing, Goelz said, due to the pandemic and people looking for a more active lifestyle. It typically hosts 17 major events with three additional fundraisers as well as participates in weekly sail races, trivia nights, live music and holiday gatherings.

The commodore said he can’t envision what the bay would be like without the Cays yacht club and its related activities. “This is a mariner-rich community,” he pointed out, especially given the Cays homes on the water with their own docks and boats.

The north end of the peninsula’s property entrance that takes people to the Cays yacht club and nearby boat storage yard.

To learn more about the Inn at the Cays proposal, visit the project website at or email [email protected]. The proposal team has responded promptly and is happy to answer questions, schedule a phone or video call, or safely meet in person at the earliest convenience.

Concerned residents can also email all the Port commissioners with opinions and questions.

Editor’s Note: This article was edited on September 4, 2020 to clarify lease and sublease information.

Aly Lawson
Aly Lawson
Aly has a BA in mass communication, emphasizing journalism and public relations, and a MBA in marketing. She has worked as a reporter and marketer in various industries and overseas. She also won a best community business story award from the Nevada Press Association in 2017. Originally from Washington, this is her second time living in Coronado, where her husband is stationed as a Navy helicopter pilot. They have two small children and the whole family adores Coronado. Have a story for The Coronado Times to cover? Send news tips or story ideas to: [email protected]