Garden Street Terraces to break ground in downtown San Luis Obispo

Construction of the Garden Street Terraces project, including the 65-room Hotel Serra, will start Friday in the parking lot behind SLO Brewing Co. in downtown San Luis Obispo.
Construction of the Garden Street Terraces project, including the 65-room Hotel Serra, will start Friday in the parking lot behind SLO Brewing Co. in downtown San Luis Obispo.

Construction on one of the largest developments proposed in downtown San Luis Obispo in recent years will start Friday.

Garden Street Terraces was approved in March 2014 after 15 public hearings from the time an initial application was submitted to the city in 2006 for development of a 1.1-acre site bordered by Broad Street, Garden Alley and Garden and Marsh streets.

The development is expected to open in spring 2017.

“It’s been a long time coming,” said developer Hamish Marshall of Garden Street SLO Partners LP. “It’s been 11 years so far. We still have two more to go.”

The project went through multiple revisions over the years: Its size was first reduced to 135,000 square feet from 212,000 square feet, and further cut back to 93,425 square feet of commercial, residential and hotel space. The final approved project has a 65-room hotel, eight luxury residential units totaling 8,640 square feet, and 41 private parking spaces.

The height of the development was also reduced to 50 feet or less from up to 74 feet in the previous version of the plan. It was the first project to be analyzed under new zoning regulations allowing 75-foot-tall buildings in the downtown core, according to a news release from the developers on Friday’s groundbreaking ceremony.

The boutique hotel is called Hotel Serra in a nod to Spanish missionary Junípero Serra, who founded Mission San Luis Obispo de Tolosa on Sept. 1, 1772. Marshall said nearly every town with a mission also has a “Garden Street,” which served as the path leading to the gardens of the mission.

Hotel Serra is about 80 percent of the project. A brasserie-style restaurant will be built as part of the hotel in the bottom floor of SLO Brewing Co., which is moving to Higuera Street. Existing tenants on Garden Street will remain and a few new tenants will be added to some retail space in the new project.

“It’s a big thing for the vitality of this town, with bed tax and tourism,” Marshall said of Hotel Serra. “We’re excited about Granada (Hotel) and its expansion, we’re excited about the Copeland’s (Chinatown) project. That’s positive for the town; you get increased marketing. It really boosts everything up.”

It’s been a long time coming.

Developer Hamish Marshall

Marshall declined to disclose the cost of the project so far or the estimated cost of construction.

The San Luis Obispo City Council initially approved the project in November 2011, but Marshall made several changes after that, which required further review: to eliminate subterranean parking, add hotel rooms, and reduce the residential, commercial and parking space.

The buildings at Broad and Marsh streets will remain, because Marshall was unable to buy that property.

The council last year also approved a 99-year lease of the city parking lot accessed from Broad or Marsh streets that will be developed as part of the project. New construction will take place in the now-closed parking lot; the existing buildings on Garden Street will remain and the facades of the historic structures, such as the Smith and the Laird buildings, will stay intact.

The project owner is Garden Street SLO Partners LP, which includes Marshall, who is vice president of WestPac Investments Inc.; Alex Pananides, who started the first WestPac company; Pat Smith, a partner in WestPac Investments; and San Luis Obispo residents Beverely and Shaun Matthews, principals of Matthews Hospitality.

The same individuals also constitute hotel management company Serra Hotels & Resorts LLC. Its website,, includes information about construction activity.

A groundbreaking ceremony for the project will start at 3:30 p.m. Friday at 1127 Garden St., behind SLO Brew.

Cynthia Lambert: 805-781-7929, @ClambertSLO