Two Santa Barbara-based hotel development firms have launched their second joint-venture in San Luis Obispo County with the purchase of a 23-acre property on the bluffs in Avila Beach.
Somera Capital Management and Postcard Properties purchased the undeveloped waterfront parcel from San Luis Obispo developer Rob Rossi for about $2.4 million, real estate firm Richardson Properties said. The property has long been envisioned and zoned for hospitality development, and the new owners hope to move forward with development of a 50-unit, cottage-style boutique hotel.
The project, which has not yet started to wind its way through what will likely be a lengthy entitlement process, is the second investment by Somera Management and Postcard Properties in south SLO County.
“The only real news is that we closed on the property,” said Dana Severey, founding principal with Postcard Properties. “We’re going to just focus on the future and wait for it to unfold. It’s a long planning process.”
The firms bought a project in downtown Pismo Beach in 2012 and has started planning the $40 million waterfront Inn at Pismo Pier. The 108-room Pismo Beach hotel project is working its way through the planning process now, with preliminary design renderings out. A Planning Commission meeting to gather community feedback is slated for April 2.
The firms wanted to invest in San Luis Obispo County, which is experiencing a significant tourism boom centered around its food and wine culture, said Chris Richardson, managing partner with San Luis Obispo-based Richardson Properties. He represented both buyer and seller in the deal.
“Those owners were looking to sell those properties, and everything lined up with the economy and the way the wine industry and tourism is taking off,” he said.
Rossi, a prolific SLO County developer, owned the Avila Beach property for more than 10 years, but decided free up resources to work on other projects, Richardson said. “He owns a lot of property and he just wanted to focus his efforts,” he said.
Postcard Properties and Somera Capital purchased the Pismo project, located at 601 Cypress St. between Hinds Avenue and Pomeroy Street, from a group of area investors after that firm’s top executive, Frank Benson, died.
Somera Management and Postcard Properties’ initial vision for the Pismo Beach project includes the hotel, a new parking structure and an outdoor common area for the city’s residents. The Pismo Beach property was previously approved for a commercial and residential development that included 11 high-end condominiums and about 31,000 square feet of retail space, along with a subterranean parking garage with 126 spaces.
Richardson, who also represented the buyers in the Pismo project purchase, told the Business Times in 2012 that he doesn’t think plans for luxury condos and new retail space in downtown Pismo Beach are the right concept in the current real estate market.
Based on the room rates and occupancy the developers are projecting, the hotel would contribute more than $1 million per year in transient-occupancy tax to the city, he has said.
“They’re first-class guys with great vision,” Richardson said. “I’m excited they’re taking these properties forward.”