He Covers the Waterfront
By James B. Kelleher
(page 1 of 4)INSIDE DOUG MANCHESTER’S OFFICE on the 33rd floor of the Hyatt Regency San Diego, the views are big. So are the plans. So is the talk. Through the floor-to-ceiling window to the right of Manchester’s desk, visitors enjoy an almost aerial view of the city’s North Embarcadero area, from Seaport Village up past the B Street Pier over to Lindbergh Field and beyond. It’s a pretty impressive panorama, Manchester admits, but not one he couldn’t improve.
“When I look out the window,” the 57-year-old developer says, gesturing toward the foot of Broadway, “I see a tremendously underutilized, horrible set of Navy buildings that should be developed into more graceful, mid-rise buildings with office and retail space and hotel rooms.”
Shifting his focus to the airport, a facility he tried unsuccessfully to move to Miramar in 1994, Manchester becomes more expansive. Lindbergh Field, he says, is a dirty hazard that will “not stand the test of time.” The sooner its terminals and runways are reclaimed, the sooner the redevelopment of the 500-acre prime parcel can commence. Manchester paints a picture of the inland waterways, golf courses, hotels and sports facilities that could replace the airport—a plan he insists would “change the environmental fabric of this city.”
Coming from most folks, this kind of ambitious talk is just that. Talk. Coming from Manchester, a man who has been compared to Alonzo Horton by his more imaginative admirers, it cannot be dismissed so easily.
“Doug has an uncanny ability to look at a situation and come up with a vision that very few other people see,” says Ben Clay, a lobbyist who worked for Manchester in the early 1980s, when he was just getting to work on the waterfront. “Doug will look at a site and say, ‘You know, this would be great for X, Y or Z.’ Other people look at it and think, ‘This guy’s nuts.’ But Doug makes it work.”
During the almost 30 years Manchester has planned developments locally, he has proven his doubters wrong time and again, turning his often unlikely visions into brick-and-mortar reality in La Jolla, on the Torrey Pines mesa and in downtown San Diego. And when those properties have experienced problems, Manchester has rolled up his sleeves to turn them around—or taken off the gloves and fought like hell to keep them alive.
His best-known work, the three waterfront towers of the San Diego Marriott & Marina and the Hyatt Regency San Diego, transformed Navy Field from a no-man’s land into a tourist magnet and probably played as important a role in the revitalization of the Gaslamp Quarter as Ernie Hahn’s Horton Plaza. Manchester’s name is not widely known outside San Diego, even among most travel-industry types, but his work is almost legendary in some circles.
“His hotels put San Diego on the map in the hospitality industry. There’s just no question about it,” says Jim Burba, an industry analyst at Insignia/ESG Hotel Partners in Newport Beach. “There was always a big hospitality presence in San Diego, but it really didn’t have great convention hotel facilities. His hotels and the city’s convention center came together and created arguably one of the best convention meeting plants in the country.”
Now, after weathering what he admits were “some real rough times” in the 1980s and early 1990s, when construction delays and high-profile battles with partners kept him awake at night and in court during the day, Manchester is once again keen to break ground and build. His company, Manchester Resorts, has proposed more than half a billion dollars in new hotels along the county’s waterfront, including a $100 million expansion of the Hyatt and a $250 million plan to develop the Campbell Industry Shipyard just south of the expanded convention center.
But his most challenging project, the one that is pure Manchester, is a $200 million plan to build a luxury beachfront resort in Oceanside, a city that Manchester, who can be extremely charitable, calls a “gem that needs polishing.” Manchester, who beat out San Francisco–based Catellus Development Corporation to win the exclusive development rights, envisions a 450-room hotel with three “world-class” restaurants built around the pier where, right now, underage leathernecks on leave hang out and look bored.
Once again, some think Manchester is crazy. His response? “Look at what we’ve done here with an old Navy athletic field.”
Still, these are big plans, fraught, industry sources say, with big problems. Forget the Coastal Commission, which has become increasingly green under Democrat Governor Gray Davis. The biggest obstacle may be the bankers. The lending market, hotel analysts say, is tighter than ever. Even established developers such as Manchester find it impossible to borrow more than 60 percent of the money they need to build their hotels.
In other words, Doug Manchester needs friends. Subtract the Hyatt expansion, which Manchester claims he can finance with the equity in the existing tower there, and he still needs to scare up about $180 million from outside investors if his visions for Oceanside and the Campbell Shipyard are ever going to see the light of day.
But can Manchester, whose ugly legal battle with one former partner, the Host Marriott Corporation, became a court case that continues to be cited in hospitality law disputes, convince folks he’s learned to play nice? Skeptics are, well, skeptical.
“It’s going to be hard to find a group that will provide that kind of equity and then support Doug Manchester,” says one hotel industry insider, who, like almost everyone who spoke candidly about Manchester, asked not to be identified. “He’s a tough guy to do business with.”