Topgolf secures 40-year lease commitment for San Diego Bay

The Port of San Diego has tentatively agreed to a 40-year lease with Topgolf International for a 9.5-acre site on East Harbor Island that will offer stunning views of San Diego Bay and the downtown skyline. The agreement was made in spite of public opposition to the project, with some people objecting to the appearance of the proposed facility and tall netting system.

The lease agreement, which is not final, sets the stage for the construction of a 70,700-square-foot, three-level Topgolf facility, complete with 102 hitting bays, a 4.5-acre outfield, event space, and multiple restaurant and bar areas. The facility will also include a polyester barrier netting system suspended on poles up to 170 feet in height.

The decision to move forward with the lease agreement also involves a new direction for 6.5 acres of neighboring land, where the Port of San Diego will solicit interest in building complementary “eatertainment” concepts. Proponents of the project believe that Topgolf, along with other concepts, could attract over a million guests to the waterfront each year.

The lease agreement calls for a 20-year base term with four five-year options to extend, totaling 40 years, with Topgolf’s minimum annual rent starting at $1.53 million. The company will potentially pay rent as a percentage of sales, starting at 5.5 percent and increasing to 7 percent over the full term. Additionally, the company is expected to cover a portion of public infrastructure costs for the broader redevelopment of East Harbor Island.

While the project has received support from local Business associations, the carpenter’s union, and area hotels, there has also been opposition, with some residents expressing concern about the project’s visual impact on the waterfront. The port is currently in the process of conducting an environmental analysis of the area and is seeking public comments on the project.

Historically, East Harbor Island was a location where three car rental companies used to operate. The redevelopment of the area seeks to create public access to the waterfront and revitalize a location that has been fenced off for decades.

In conclusion, the Port of San Diego is moving forward with a lease agreement that has the potential to transform East Harbor Island into a vibrant waterfront destination, despite public opposition to the Topgolf project. The agency is expected to publish a draft of the environmental impact report in the coming years.

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