SAN DIEGO (KGTV) — On Tuesday, the Board for the Port of San Diego voted unanimously to approve the non-binding term sheet on an item connected to Topgolf's effort to set up shop on Harbor Island.
According to the board, the next steps include an environmental review, board consideration of the project, and board consideration of a lease agreement. "If all approvals are obtained, the earliest construction could begin is in late 2025," the board said.
It's a push that's been in the works since 2015, and Topgolf has spent more than a year working on a lease agreement as the board wants to see how environmental issues would be addressed and if the Coastal Commission would permit Topgolf to build its facility.
According to a Port of San Diego spokesperson, the project's environmental review is underway, and a public review of the environmental impact report is expected to happen in the first half of 2024. Following that review, the board will consider approving the project and entering into a lease agreement with Topgolf in the second half of 2024.
"Final approval of a Port Master Plan Amendment (if necessary) followed by a Coastal Development Permit is expected in 2025 with commencement of construction soon after," the spokesperson says.
In its proposal, Topgolf said it doesn't just want to build its facility on Harbor Island for the convenience of being next to the airport or for the panoramic views of the ocean, but it sees a strategic opportunity with as a number of car lot leases are about to expire. They include secondary lots for car rental companies like Avis, Enterprise, Hertz, and more.
The Port said it also favors the idea of Topgolf coming to San Diego because it could help revamp Harbor Island.
The new Topgolf facility would be a flagship location, with nearly 71,000 square feet, three levels, 102 hitting bays, multiple restaurants, outdoor decks, and more.
Topgolf would pay over $1.5 million in rent annually and the lease term would run for 40 years.
Initially, the Port wanted a hotel on the same parcel of land, but one real estate expert told ABC 10News that a venue like Topgolf would be a better fit to shift the land use from a hospitality to an entertainment district.
Gary London, a real estate economist with London Moeder Advisors, said, "The developer of the hotel, a bonafide developer, opted out. They walked away from the deal and that gave us a clue that perhaps the hotel wasn't the best solution."
London also went on to explain that housing cannot be built on the parcel of land because of the fault line the land sits on.
London said the land has been in need of diversification after surviving the pandemic. The pandemic slowed operations with the airport and car rentals significantly.
"They have an opportunity to still connect revenue and still connect activity at the port," London said. "This is an opportunity for the port for economic diversification."
In its lease agreement, Topgolf also promises to host 25 charitable events every year, on top of other opportunities to donate or give back to the community.
To see the full proposal, follow this link and head to page 333.
EDITOR'S NOTE: An earlier version of this story indicated the board was prepared to vote on a lease agreement with Topgolf. Tuesday's vote will not approve or deny any funds or final design for the project but rather for its negotiating framework.
