SFO Building $225 Million, 350-Room Hotel to Be Managed by Hyatt

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By Adam Steinhauer

San Francisco International Airport plans to build a 350-room, four-star hotel on airport property, at a projected cost of $225 million, to add upscale hotel rooms that will be connected to SFO by rail.

Hyatt Hotels Corp. has been given the branding and management contract for the property, which will be operated under the Grand Hyatt brand.

[contextly_sidebar id=”5ppYU5UUnBMMu47Zoe02mcjgdZO38bqV”]The hotel is expected to open in mid-2019, with construction to start this spring.

The Grand Hyatt is expected to be the only four-star hotel on the San Francisco Peninsula, airport spokesman Doug Yakel said. And with the airport maintaining ownership, it expects to be able to enforce standards for its quality, to the economic benefit of the city.

“We really want control over our facilities and we want that to make sure the quality remains at a very high level,” Yakel said. “Because we own the facility, we have the ability to drive that high standard.”

The hotel will be located a 4.7-acre site that is close to terminal buildings and parking garages, the airport has said.

The property will also have direct access to the AirTrain rail system, which connects to airport terminals, parking garages, the airport’s rental car center and BART.

Along with roughly 350 rooms, the hotel is expected to have about 17,500 square feet of meeting space, full-service and casual restaurants, wine and sushi bars, a rooftop cocktail lounge, a health club, pool and spa.

The property will be designed to achieve Leadership in Energy and Environmental Design (LEED) “Gold” certification for environmental sustainability, the airport has said.

Hornberger + Worstell is designing the hotel, according to Yakel. Webcor Builders has the construction contract.

The Airport Commission plans to issue $243 million in bonds to finance the project. The offering is expected to net $225 million in construction proceeds, Yakel said. The timing of the offering has not yet been determined, but it is likely to be sometime early in 2017.

The building of a new hotel on airport property will achieve an ambition that airport officials have held for a decade and a half, according to Yakel. A Hilton hotel had previously stood on San Francisco airport grounds until the late 1990s, when it was torn down to make room for renovations that included the airport’s current international terminal.

The replacement of the Hilton has repeatedly been delayed by economic setbacks and crises in the air travel industry, including the dot-com bust, 9/11 and the SARS epidemic.

Now, with the economy strong and air passenger traffic to SFO increasing, airport officials believe the time is right, Yakel said.