The Garden Street Terraces project, 93,425 square feet of commercial, residential and a 64-room hotel, was approved by the council on a 3-1 vote.
The project is planned for a 1.1-acre site bordered by Broad Street, Garden Alley and Garden and Marsh streets in the historic district of downtown San Luis Obispo.
It is the largest redevelopment project in the city’s downtown since the Court Street open-air shopping center was built by Tom and Jim Copeland in 2006.
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Councilwoman Kathy Smith opposed the project, saying its large size goes against the character of the downtown. Councilman Dan Carpenter recused himself because he owns commercial property nearby.
The council also approved an agreement with developer Hamish Marshall of Garden Street SLO Partners LLC for a 99-year lease of a city parking lot that will be developed as part of the project.
Marshall introduced the contemporary-styled project to the city in 2005.
The project approved Tuesday night is nearly one-third smaller than the 135,448-square-foot project approved by the council in 2011 — and drastically different than its first inception.
In early stages, Hamish proposed a project that included a 70-room hotel, 53 condominiums and 17,000 square feet of retail space. Structures were proposed to be four or five stories high, with the tallest point reaching 74 feet.
Now, no portions of the project will reach more than 50 feet and the buildings are no more than four stories tall.
The project was revised multiple times over the past nine years and went through more than a dozen public hearings. An early version of the project was modified to retain the existing buildings on Garden Street — keeping the facades of historic structures, such as the Smith and the Laird buildings, intact.
The most recent change made to the project kept the building on the corner of Broad and Marsh streets, which is occupied by the Couch Potato furniture store, as it is today.
That portion of the proposed project faced public opposition because of its height and dark gray color scheme.
Marshall was unable to purchase that property from Marsh Street Associates LLC, operated by John Rossetti and Vic Montgomery.
It will be included in the project, but under separate ownership, and remain one story, not multiple stories as once proposed.
The final project includes a 64-room hotel, eight residential units totaling 8,640 square feet, and 41 parking spaces.
The residential units, ranging from 1,000 to 1,250 square feet, will be privately owned. Homeowners will have the option of paying a homeowners association fee entitling them to all the amenities of the hotel, such as maid service and laundry, Marshall said.
All of the residential and hotel parking will be valet. The City Council, prompted by Councilwoman Carlyn Christianson, included a condition of approval Tuesday night stipulating that no street parking can be used. Instead, the developer must contract with the city or another entity for overflow parking.
An additional condition was added stating that the residential units could not be converted to hotel use.
Groundbreaking is anticipated in April 2015. Marshall hopes to have the hotel, of which Pacific Hotels Corp. is a partner, ready for occupancy by the summer of 2016.
Reach AnnMarie Cornejo at 781-7939. Stay updated by following @a_cornejo on Twitter.