1. Susan Jordan, Executive Director California Coastal Protection Network
Loss of Lower and Moderate Cost Visitor Serving Accommodations in the Coastal Zone
Susan Jordan, Executive Director
California Coastal Protection Network

2. Public Access to the Coast is a “Right” not a “Privilege”
Article X, Section IV of the California Constitution protects the public right of access to the shore:
No individual, partnership, or corporation, claiming or possessing the frontage or tidal lands of a harbor, bay, inlet, estuary, or other navigable water in this State, shall be permitted to exclude the right of way to such water whenever it is required for any public purpose, nor to destroy or obstruct the free navigation of such water; and the Legislature shall enact such laws as will give the most liberal construction to this provision, so that access to the navigable waters of this State shall be always attainable for the people thereof.

3. What is Public Access?
Eliminating barriers such as signage, gates, walls, patrols, etc.
Providing transportation via adequate, low cost parking, bus and train routes, bicycle racks, etc.
Providing hospitable environments such as bathrooms, showers, etc.
Providing overnight visitor-serving accommodations for lower and moderate income persons.

4. Evolution of Public Access Requirements in the Coastal Act
1975: California Coastal Plan identifies the lack of tourist facilities for low and moderate income persons as an impediment to public access
1976: Coastal Act’s broad and strong access provisions include PRC that mandates protection, encouragement, and, where feasible, provision of lower cost visitor serving facilities
1981: PRC amended to prohibit the CCC from setting room rates or establishing any method of identifying persons of low or moderate income.

5. The Coastal Act’s Role in Protecting Lower Cost Accommodations
PRC Lower cost visitor and recreational facilities shall be protected, encouraged, and, where feasible, provided. Developments providing public recreational opportunities are preferred.
Neither the commission nor any regional commission shall either: (1) require that overnight room rentals be fixed at an amount certain for any privately owned and operated hotel, motel, or other similar visitor-serving facility located on either public or private lands; or (2) establish or approve any method for the identification of low and moderate income persons for the purpose of determining eligibility for overnight room rentals in any such facilities.

6. LCOA: An Endangered Species on the Brink of Extinction?
Reasons for rapid loss of LCOA:
Weak, ineffective provisions in the Coastal Act.
Outdated Local Coastal Plans – ineffective; lack policies that protect existing LCOA or provide mechanisms for development of new LCOA.
Pressure to convert lower cost visitor serving areas into high-end private residential housing.
Financial incentives for developers to demolish or convert existing lower cost accommodations into luxury high-end hotels.

7. Coastal Commission’s Response to Loss of Low Cost Accommodations
• CCC provides the developer with a ‘choice’ which is then incorporated into a permit condition if approved:
– Replace lost units on site or offsite.
Require an in-lieu fee for lost units
@ $34,100 per unit lost.
Require a percentage (25%) of new construction to be affordable.

8. Loss of Moderate LCOA Proceeding under the CCC Radar
While the provision of “low” cost accommodations is our most critical challenge, many “lower” and “moderate” cost units have also been lost over the last several decades.
For the most part, these losses have occurred without CCC review, appeal or any requirement to preserve lower cost accommodations on site or via the payment of an lieu fee.

9. At Risk: Sea Sprite Motel in Hermosa Beach

10. At Risk: Sea Sprite Motel in Hermosa Beach
38 room oceanfront hotel, family-owned and operated since 1966.
Rates as low as $140 in the summer/peak season.
Constant offers from developers to sell with the likely intention to level it and convert to non-visitor serving use or upgrade to luxury.
Many more like this up and down the coast.

11. Lost: Casa Malibu in Malibu

12. Lost: Casa Malibu in Malibu

13. Replaced by: Nobu Ryokan

14. Lost: Casa Malibu – No CCC Review
Historic affordable hotel on the sand in Malibu in operation for 60 years with room rates in the $129 to $189 range.
Purchased by billionaire Larry Ellison in 2007 for $20M and converted into a luxury Japanese concept hotel called Nobu Ryokan.
“…received a [coastal development permit] from the Malibu Planning Commission for a remodel (defined as less than 50% of the walls to be demolished) … “It is a major remodel, so when the work begins, the only thing that will probably be left standing is 50% of the walls.” 

15. Lost: Ben Brown’s in Laguna Beach

16. Lost: Aliso Creek Inn, Former Ben Brown’s

17. Replaced by: The Ranch at Laguna Beach

18. Replaced by: Ranch at Laguna Canyon
Historic affordable hotel replaced with “luxurious canyon golf & spa resort with rooms, cottages & a posh 1,600 square-foot treehouse.”
History of violations and unpermitted demolition of existing structure.
CCC staff recommended an in-lieu fee for the loss of affordable rooms. CCPN’s application of CCC traditional in-lieu fee formula would have resulted in a $2.4M mitigation fee; Commissioners voted to not require ANY in-lieu mitigation fee and only required a $250K donation for a trail.

19. Lost: San Simeon Pines 1of 6 Upscale Conversions on Moonstone Beach in Cambria

20. Pacifica Hotels: Corporate Strategy
Pacifica Hotels: Hospitality group is taking coastline properties by storm
March 20, 2016 | Updated March 21, :27 p.m.
“For years, Irvine-based Pacifica Hotels has quietly been watching properties, waiting for the right moment to pounce on hotels that fit its position as a boutique hotel owner and operator.”

21. Pacifica Holdings along the CA Coast
Pacifica owns 34 hotels, 23 along the CA Coast and and 6 properties on Cambria’s Moonstone Beach alone:
San Simeon Pines (latest purchase)
Fireside Inn
Cambria Landing and Suites
Pelican Inn and Suites
Fogcatcher
El Colibri
An owner operator that is focused on off-market deals in ‘legacy locations.’
No CCC Review

22. Pacifica: A Focus on CA Coastal Hotel Properties
SF AREA:
Half Moon Bay Lodge
LA AREA
Carlyle Inn
CENTRAL COAST
The Redondo Beach Hotel
San Simeon Pines (latest purchase)
The Belamar
Fireside Inn
Marina Del Rey Hotel
Cambria Landing and Suites
Jamaica Bay Inn
Pelican Inn and Suites Fogcatcher
The Kinney
El Colibri
Inn at Venice Beach
Holiday Inn Express/SLO
Hotel Hermosa
Spyglass Inn
SAN DIEGO AREA
Cottage Inn
Blue Sea Hotel
Sandcastle Inn
Sommerset Suites
The Tides
La Jolla Cove Suites
Pacifica Suites
Wayfarer

23. Potential Remedies/Responses under Existing Law
Clear and consistently applied definition of “lower cost” and “moderate cost’ units.
Better monitoring of potential conversions or renovations that will increase prices
Consistent denials of new projects that will not adequately protect existing LCOA, provide for sufficient new LCOA as part of project, or, as fall-back option, provide sufficient in-lieu fees
Realistic calculation of full costs of developing replacement LCOA; assessment of in-lieu fees to reflect such costs and better ensure development of in-kind replacement accommodations

24. Potential Remedies/Responses under Existing Law (continued)
Improved partnerships between Coastal Commission, state and local park agencies, Coastal Conservancy, and others to plan and develop LCOA projects with blended funding from public sources, in lieu fees, and other sources
Improved LCOA options, programming, and marketing for state-owned properties
Support for public funding, where appropriate, for projects to enhance availability of LCOA, e.g., bond funds for grants to local park agencies and qualified nonprofits

25. Don’t Let the Low and Moderate Cost Accommodations Slip Through CA’s Fingers