Manchester, Seaport Village Square Off Over Expansion Plan

Seaport Village Ltd. and Hotel Inter-Continental developer Doug Manchester--two of the biggest bayfront developers in San Diego--clashed Tuesday over Seaport Village’s extensive expansion plans.

As a result of Manchester’s complaints, Seaport Village’s plans were delayed until early next month by the San Diego Unified Port District, which oversees development along San Diego Bay and is the landlord for both Manchester and Seaport Village.

Seaport Village wants to triple its size by building more restaurants, shops and entertainment spots on 12 adjoining acres and rebuilding the old police station. The expansion concept has already been approved by the Port District.

Seaport Village officials Tuesday asked the Port District board of commissioners to formalize the approval by giving them an option agreement on the property. However, Port District officials balked as the result of complaints from Manchester and his representatives and because of a request for more time from San Diego City Councilman Bill Cleator.

Manchester said, in essence, that the Port District was rushing to grant Seaport Village an option without having given other developers the chance to bid on a proposal to build shops and restaurants on the expansion site.

Manchester also said the proposed rent was inadequate and he vowed to double what Seaport Village would be paying to the Port District.

Manchester pressed for a delay by saying that the location of a proposed realignment of Harbor Drive, caused by the expansion, could hurt his plans to build a third hotel next to Seaport Village by hindering entry to the hotel site.

Morris B. Taubman, chairman of Seaport Village Ltd., said the success of Seaport Village had made it in less than 10 years into a “local institution” on a par with other tourist attractions such as the zoo and Sea World.

Taubman said it is natural for Seaport Village to expand. The Port District staff, in arguing against seeking bids from competing developers, said it prefers that the proposed development remain under the same ownership and management.

“Negotiations with Seaport for the redevelopment of the police station site and other district tidelands adjacent to Seaport Village have been based on the concept that a better utilization of the land could be made by expanding the existing Seaport development than by issuing (bids to other developers) and potentially permitting another developer to develop a separate commercial development,” according to a Port District staff report.

If the Port District were to grant Seaport Village a 20-month option, as has been proposed, construction on the expansion and a 2,200-space parking garage could begin sometime in 1989.

Manchester, chairman of the board of La Jolla-based Torrey Enterprises, said: “What’s being proposed here is not in the best interest of the Port District.” Manchester is suing the Port District over delays in construction of the convention center next to his hotel.

He said that until a few days ago he was unaware that the Port District planned to act on Seaport Village’s request. Noting that his hotel and an adjacent hotel tower under construction represent a $250-million investment, Manchester said he found such a lack of notification intolerable. “That’s ($250 million) about 15 times more than Seaport Village,” he said.

Manchester also claimed that when he wanted to build some retail shops along with the Hotel Inter-Continental, the Port District asked for considerably higher rent than it is now asking for Seaport Village’s expansion.

In response, attorney Richard Burt, representing Seaport Village, accused Manchester of “grandstanding” and making “off-the-wall” proposals. “He doesn’t know how to operate a shopping center,” Burt said.

It was clear from the comments of the handful of Port District commissioners who spoke that, while they favored the Seaport Village expansion, they wanted more information on rents and the traffic that will be generated by the development.

“We have a dispute here among two of our best tenants along the bay . . . maybe we can have one last chance to come up” with an acceptable compromise, said Dan Larsen, the board’s new chairman. Larsen said he wanted Manchester, Seaport Village officials and the Port District staff to try to resolve the issue by Feb. 3, when the matter will return to the commissioners.

William Rick, another Port District director, also asked for a delay, noting that Councilman Cleator had asked him to request a postponement.