As part of San Diego's Board of Port Commissioners unanimously-approved term sheet for the proposed downtown location of TopGolf driving range and entertainment venue, staff were directed to move forward with the concept of creating an "Eatertainment" district on the adjacent bayfront property.
The Board today unanimously authorized staff to sign a non-binding term sheet with TopGolf. The non-binding term sheet provides a negotiating framework for any potential future lease agreement between the Port and Topgolf to be submitted to the Board for consideration. This was not a final vote nor did the Board approve the proposed project.
Founded outside London in 2000 by brothers Steve and Dave Jolliffe, Topgolf is a redesigned driving range that uses microchip technology inside golf balls to make driving balls its own unique game. The company is now owned in part by Carlsbad's Callaway Golf Company and currently operates nearly 60 locations, most of which also house an event space, restaurants, bars, and multiple entertainment rooms.
The term sheet for TopGolf provides a proposed lease term of 20 years with four, five-year options to extend. Minimum annual rent following completion of construction is set at $1,527,000; however, projected rent upon commencement of operations is approximately $1.9 million in year one of operations based on percentage rental rate projections. The terms also provide for a contribution from TopGolf for a portion of the public infrastructure costs on East Harbor Island, and a community benefits package that includes numerous programs for the local communities and organizations.
The term sheet for TopGolf provides a proposed lease term of 20 years with four, five-year options to extend. Minimum annual rent following completion of construction is set at $1,527,000; however, projected rent upon commencement of operations is approximately $1.9 million in year one of operations based on percentage rental rate projections. The terms also provide for a contribution from TopGolf for a portion of the public infrastructure costs on East Harbor Island, and a community benefits package that includes numerous programs for the local communities and organizations.
San Diego's Board of Port Commissioners has not approved the Topgolf project, the design, the draft project description, a lease, any financing for the project or any other approvals necessary to carry out the project, all of which may be granted denied, or conditioned in the Board’s sole and absolute discretion. Further, the Port is not committing to fund all or any portion of the project.
For the proposed East Harbor Island location, Topgolf is proposing a three-story venue housing 102 hitting bays with an event/stage area, outdoor patios, and additional games and entertainment. The project is proposed for an approximately 9.5-acre parcel at the southwest corner of North Harbor Drive and Liberator Way. More specifically, the area of East Harbor Island is the north basin side bordered by North Harbor Drive to the North, with Liberator Way wrapping around the South and East end, and Harbor Police Headquarters to the West.
For the proposed East Harbor Island location, Topgolf is proposing a three-story venue housing 102 hitting bays with an event/stage area, outdoor patios, and additional games and entertainment. The project is proposed for an approximately 9.5-acre parcel at the southwest corner of North Harbor Drive and Liberator Way. More specifically, the area of East Harbor Island is the north basin side bordered by North Harbor Drive to the North, with Liberator Way wrapping around the South and East end, and Harbor Police Headquarters to the West.
Currently, the proposed project is undergoing environmental review. It is anticipated that public review of the Draft Environmental Impact Report would occur in the first half of 2024 followed by Board consideration of the project for approval and to enter into an Option to Lease Agreement in the second half of 2024. Final approval of a Port Master Plan Amendment (if necessary) followed by a Coastal Development Permit is expected in 2025 with commencement of construction soon after.
Additionally, as part of efforts to enhance and activate the San Diego Bayfront, the Board directed staff to move forward with the concept of creating an entertainment district in the area where TopGolf is proposed on eastern Harbor Island where rental car companies currently operate and have operated for years. The plans call for TopGolf as the anchor tenant and could include other “Eatertainment” concepts, including leisure activities such as pickleball, mini-golf, darts, ping-pong, and shuffleboard in tech-infused settings similar to Topgolf.
Expect the "Eatertainment" district to include breweries, restaurants, and other similar retail operations with an emphasis on blending entertainment with quality food and drinks. Examples include Chicken N Pickle, Camp Pickle, and Popstroke. Any future redevelopment of this area of East Harbor Island would also include public waterfront parks - 11 acres in addition to the parks that exist on Harbor Island today - as well as waterfront promenades that connect to the rest of Harbor Island.
For the entertainment district's request for proposals, Port staff anticipates issuing the such requests toward the end of the first quarter of 2024. The process from issuance of the requests to selection of a proposal is expected to take six months. Request for proposal responses would be due in mid-2024. Staff anticipates returning to the Board no sooner than the third quarter of calendar year 2024 with recommendations.
For the entertainment district's request for proposals, Port staff anticipates issuing the such requests toward the end of the first quarter of 2024. The process from issuance of the requests to selection of a proposal is expected to take six months. Request for proposal responses would be due in mid-2024. Staff anticipates returning to the Board no sooner than the third quarter of calendar year 2024 with recommendations.
In addition to the anticipated $40 million, 68,000 square-foot facility planned for San Diego's bayfront, Topgolf International has plans for a second area outpost to open in Sorrento Valley. Current plans for TopGolf in Sorrento Valley are focused on TopGolf redeveloping the Carroll Canyon Golf Center, replacing it with a three-level venue equipped with the company's latest technology throughout its 80+ bays. There is no word on the status of that location.
