Mayor Todd Gloria is asking the City Council to declare three parcels in city-owned Mission Bay Park surplus land — the first step toward redeveloping over 28 acres of commercial property in the popular open space.
The idea, according to the city’s Economic Development Department, is to remake a conference center, two marinas and a restaurant into new community assets — in particular a hotel, as called for in the city’s long-term master plan.
“The city leases portions of Mission Bay Park to various entities,” Director Christina Bibler wrote in a report to the council. “The city intends to issue requests for proposals to offer three of these properties for separate long-term ground leases, with the goal of facilitating redevelopment.”
The affected parcels include the 23-acre Marina Village banquet and conference center on Quivira Way, the 4.5-acre Dana Landing Marina on Ingraham Street and just under an acre nearby that hosts the Sportsmen’s Seafood restaurant and various water-related businesses.
In her report to the council, Bibler notes that the Surplus Lands Act is generally used as a tool to develop affordable housing.
But the Mayor’s Office said the city is not seeking to build homes on the properties. Instead, the city wants a new hotel at the site of the banquet center.
To negotiate what is likely to be a decades-long lease, the property must first be declared surplus under state law, spokesperson Rachel Laing said.
“With the (current) lease ending in 2027, we are going to be seeking a long-term lease to fulfill the Mission Bay (Park) Master Plan, which envisions a hotel and conference center at this site,” Laing said by email.
Bibler said the city sought exemptions so the parcels could be redeveloped without declaring them surplus or invoking the Surplus Land Act — but the state Housing and Community Development Department denied that request.
Newly amended state legislation aimed at confronting a widespread housing crisis is driving the surplus designation, Laing said.
“Nearly every long-term lease/land deal the city does now must go through this Surplus Land Act process,” she said. “Attracting such a considerable investment demands we offer a lease of more than 15 years, and anytime a public agency in California seeks to lease land for over 15 years, the Surplus Lands Act requires first offering it up for affordable housing.”
The city declined to say what it wants to see developed on the two smaller parcels.
Joe Busalacchi doesn’t understand why San Diego wants a new bidding process for his modest leasehold when his family has run the popular Sportsmen’s Seafood restaurant for decades.
He said he was close to reaching a deal to extend the lease his family first negotiated in the 1950s when the city suddenly ended negotiations. Now he worries for his restaurant and the 100 people who work there.
“We’ve been the longest-operating business in Mission Bay,” Busalacchi said. “There wasn’t even a bridge over Mission Bay when my grandfather built this place. They stopped our lease when we were an inch away from getting an extension.”
Busalacchi, whose extended family operates several other restaurants around San Diego, said he has invested $100,000 a year in the property his family has leased since 1974 and was prepared to spend much more once he secured an extension.
“It doesn’t make any sense,” he said. “There’s nothing you can build on this little piece of land.”
City officials said they could not discuss negotiations or negotiating strategies.
A manager at Dana Landing Marina said last week he did not know about the city’s plan to declare that property surplus. Marina Village operators did not respond to a request for comment.
Mission Bay Park was formed more than 60 years ago and is supposed to be preserved in perpetuity as public parklands.
The plan to declare the three lots surplus property has not been well received by some residents, even though the properties are already developed.
Former City Councilmember Donna Frye, who witnessed the development of Mission Bay as a girl, called converting what is now Marina Village into a hotel a terrible idea.
“The city needs parkland, and places to take their kids and families,” she said. “Mission Bay is one of the largest aquatic parks in the United States. We are not growing more parkland.”
Frye said she would like the two smaller properties to remain in their current uses and the larger parcel to be broadly discussed in public before being declared surplus. She wrote to all nine members of the City Council last week, urging them to delay a vote and consider the plan more thoroughly.
“There is no urgency to hear this matter on July 29 because the lease for Marina Village LLC does not expire until April 30, 2027,” she wrote. “This is a matter of great public concern and interest because Mission Bay Park is one of our most beloved coastal areas.”
Jeff Johnson, who is the chair of the Mission Bay Park Committee, said the issue should have been evaluated by the group before going to the City Council because the group’s primary responsibility is protecting and enhancing Mission Bay Park as recreation and open space.
“The committee takes seriously any situation that could undermine the park or its purpose,” he said. “We will withhold judgment until the committee is fully briefed by city staff on the issue and can come to an informed, consensus position.”
The mayor’s recommendation to the City Council asks council members to waive the requirement that surplus land first be circulated for review by all city departments to decide whether there is another municipal use for the property before seeking to offer it for commercial lease.
Once a surplus declaration is made, the city must distribute what’s called a notice of availability to other government entities, in case any of those agencies want or need the property.
That notice will spell out in more detail what requirements and conditions any developer would be asked to meet on the three properties, Bibler said, giving officials more direct control over what is built there.
Originally Published: July 28, 2025 at 6:35 PM PDT