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Council OKs Marriott’s Plan For Gaslamp

Council OKs Marriott’s Plan For Gaslamp

BY MANDY JACKSON

The developers of the Marriott Renaissance Hotel in Downtown San Diego have made several offers to buy the last 5,000 square feet of land that they need for their 12-story, 334-room Gaslamp Quarter hotel.

The current owner, Ahmad Mesdaq, who operates the Gran Havana Lounge at Fifth Avenue and J Street, says the reason he won’t sell has nothing to do with money.

GRH LLC, a partnership of local investors Ed Himmelberg and Ramin Samimi with Denver-based Hospitality Investment Counselors Inc., says it is willing to accommodate Mesdaq, within reason. GRH already owns the other 35,000 square feet it needs for its hotel.

The San Diego City Council approved the developer’s hotel plans on March 30.

If GRH is unable to buy the property, the City Council’s approval of the project allows the Centre City Development Corp. to use its recently renewed power of eminent domain to initiate condemnation proceedings for the site.

However, the CCDC, the city’s planning and redevelopment agency for Downtown, is trying to facilitate a private transaction.

“My hard work is not for sale. I do not want to sell, period,” Mesdaq said. “You want this hotel, then you build around me.”

He said he will not accept any offer and will let the matter be resolved by a jury when condemnation proceedings land in court. Mesdaq called the struggle over his property undemocratic and compared it to actions by the government in Afghanistan, which his family left when he was a child.

“I don’t blame the developer. He’s a businessman. He wants it all. But the mayor and the council they have to protect me from abuse of condemnation,” Mesdaq said.

Prior Notice

Himmelberg said plans for the hotel were under way before Mesdaq bought his building. Prior to selecting the Gaslamp Quarter site for its hotel, GRH owned some property in the East Village that was acquired by the city for Petco Park.

In addition to 334 rooms, the four-star hotel will have a two-story lobby, two restaurants, 10,300 square feet of meeting space, 13,700 square feet of street level retail, 205 underground parking spaces, and an outdoor pool deck and garden.

Himmelberg said planning guidelines for Downtown limits the hotel’s valet entrance to the corner where Mesdaq’s property is located. Even if Mesdaq were to accept an offer incorporating his business into the hotel building, it couldn’t be at the corner.

Mesdaq opened Gran Havana, a cigar bar and coffee shop, 13 years ago and moved from leased space at Fifth Avenue and Market Street last year. He purchased Gran Havana’s current location four years ago for $1.3 million and spent $1 million to refurbish it.

While the transaction was in escrow, and after he put down a $100,000 down payment, the CCDC notified Mesdaq that the property was on the site of a planned hotel development. He said he attempted to sell the property to the hotel developers, but they declined his offer in preference of condemnation proceedings.

“We have asked him several times to let us know what would be acceptable to him,” said Cindy Eldred, the San Diego attorney representing GRH.

Eldred said there are two offers to acquire Mesdaq’s property.

In the first offer, GRH would pay $3 million or the fair market value determined by an appraiser selected by the CCDC, whichever is greater. The developer would rent the building back to Mesdaq for $1 per month until the end of the year, when the building would have to be demolished.

In the second offer, GRH would create a condominium within the hotel project that Mesdaq would own and could use for his business on Fifth Avenue.

Past offers involved cash purchases, relocations to leased space in the hotel, and new locations off of the site. Eldred said Mesdaq refused those offers.

GRH hopes to make progress on purchasing the property by the end of April, and begin construction within six to nine months, Himmelberg said. The hotel could open in mid-2006 after 18 months of construction.

Himmelberg said, “All of the financing and equity is in place. We just need to move forward.”

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