Loan Filing Sets Stage for Construction of 2nd Waterfront Hotel Tower
The continued development of San Diego’s waterfront took a significant step forward Thursday with the official recording of a $208-million loan package between Torrey Enterprises Inc. and Home Savings of America that clears the way for construction of a second Inter-Continental Hotel tower.
The filing of the loan papers with the San Diego County recorder’s office came just a day before today’s deadline imposed by the San Diego Unified Port District, which owns the property and has a development contract with Torrey Enterprises. Had the company failed to meet the deadline, it risked losing its option to build a proposed Hyatt Regency Hotel nearby.
Torrey Enterprises developed and owns the first 681-room hotel tower, which is managed by Inter-Continental. An identical arrangement is part of the second tower project.
A buoyant Doug Manchester, the La Jolla developer who is president of Torrey Enterprises, said the second, 683-room tower will be open for business “in time for the Super Bowl in 1988.” San Diego is the host for the January, 1988, football extravaganza.
With the addition of the second tower, the Inter-Continental will have 1,364 rooms adjacent to San Diego Bay. The added rooms are considered a key element in the success of the Port District’s convention center, a $125-million complex currently under excavation next to the hotel. The convention center, however, is six months behind schedule, with its opening tentatively set for mid-1988.
Manchester’s efforts to build the second tower had been stymied by financial setbacks. Initially, Beverly Hills Savings and Loan was Manchester’s lender for the second tower, but that deal fell apart last spring when the lender was seized by federal regulators.
In September, Manchester announced an agreement with Home Savings of America involving a $118-million refinancing of the Inter-Continental and $90 million in construction financing for the second tower. Last week, the port commissioners consented to the financing package. The final step in the process occurred Thursday with the official recording of the loan.
At a news conference held at the Inter-Continental, Manchester said the loan is the largest ever made by Home Savings to a single entity and that he believes it is the largest for a single development in San Diego history.
Robert Jacobson, executive vice president for Home Savings, confirmed in a telephone interview from Los Angeles that the loan is indeed the largest the company has made to a single business.
“Obviously we’re very optimistic,” Jacobson said. “With the two towers and the convention center, we feel this will be an outstanding development for the city . . . better than anywhere in the country.”
In addition to the $208-million loan package, Manchester’s other investments in the project include $16 million from Torrey Enterprises, $3.8 million from the Inter-Continental Hotel and a $10-million buy-out of Beverly Hills Savings and Loan’s interest in the hotel.
