A prominent real estate developer wants a Superior Court judge to halt the city’s plan to open a large safe parking lot for homeless people living in vehicles this spring.
McMillin-NTC, which transformed the former Naval Training Center now known as Liberty Station into a bustling shopping and entertainment district, recently asked Superior Court Judge Gregory W. Pollack to grant an injunction while its legal fight over the project near the airport continues. Pollack is set to hear arguments from the city and McMillin on April 30.
The request follows failed settlement talks in the months before and after McMillin’s September lawsuit against the city and the California Coastal Commission.
McMillin’s lawsuit argues that the city’s move to convert a former public safety training hub near the airport into a 190-space lot for homeless San Diegans violates a 25-year-old agreement between the city and the federal government that barred homeless services on the site. The developer’s suit also alleges that the city failed to get a proper use permit and failed to comply with the state’s premier environmental law in its pursuit of the safe parking lot, and that the coastal agency’s decision to grant a coastal development permit for the project violated the state Coastal Act.
Mayor Todd Gloria argues otherwise and is adamant the city will prevail in court. He claims McMillin has been unreasonable.
“It is unconscionable that McMillin — a company that has derived considerable financial benefit from nearby public land — is attempting to block our efforts to deploy this city-owned land to help people and improve our community,” Gloria wrote in a statement.
McMillin Chairman Scott McMillin argues that his company tried to work with the city before it took legal action.
“They’re just bullying their way through this,” McMillin said.
McMillin also maintains his company isn’t trying to stop the safe parking project altogether but to find a way to ensure the best outcome for investors, hotel visitors and others with a stake in the area that surrounds H Barracks.
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The possibility of homeless services at H Barracks, a five-acre site next to the San Diego International Airport and across the Esplanade Canal from Liberty Station, first publicly emerged in June 2023.
The city released a shelter strategy that identified H Barracks as a site that could potentially accommodate 300 to 700 people in multiple large tent shelters and perhaps a safe campsite or a parking lot for people living in vehicles. Gloria’s office expected H Barracks could be in operation for as long as five years before the city proceeded with a Pure Water processing site there. Point Loma residents soon mobilized against that plan.
As Gloria’s office continued discussing the H Barracks plan, McMillin decided his company needed to speak up – at least behind the scenes. He hired Aimee Faucett, former mayor Kevin Faulconer’s chief of staff, to help and she requested a meeting with Gloria.
The McMillin team wanted to go over the longtime Naval Training Center reuse and planning documents they understood to ban homeless services in the area. Those 25-year-old plans assumed McMillin would finance what turned out to be a more expensive than predicted redevelopment of Liberty Station in exchange for what the Union-Tribune editorial board later described as some land “for almost no direct cost.”
As the city worked out those plans, it opted to pay homeless service providers $7.5 million rather than house homeless residents at the Liberty Station site.
As part of the Liberty Station redevelopment that proceeded, McMillin envisioned three hotels, including two that have already been built.
Early last year, McMillin wanted to brief Gloria’s team on how the initial two hotels were already being impacted by homelessness in the area and fears about how the planned third hotel near H Barracks could fare.
McMillin and his team met with Gloria and his team in January 2024.
After the meeting, an email obtained by Voice of San Diego shows Faucett emailed a mayoral staffer proposing that the city pledge to shut down shelter operations at H Barracks by early 2029, allow McMillin to provide input on operational plans for the site and “establish a range of acceptable response times” for police calls in the area.
Faucett also proposed that Gloria’s office seek City Council approval to extend hotel ground leases in the area. The leases are now set to expire at the end of 2068 and Faucett urged Gloria’s team to extend them to each cover 66 years of operation to “allow the hotels to recoup the losses caused by the H Barracks shelter, at no cost to the city” and to address previous delays in opening the hotels.
McMillin and Faucett said they didn’t hear back from Gloria’s office on their pitch.
Then, in April 2024, Gloria sent a letter to McMillin stating that a new proposed shelter site in Middletown would allow the city to focus solely on safe parking at H Barracks. Yet Gloria noted in the letter obtained by Voice that his team would be including a large tent shelter in its application for a coastal permit for the site “should the city wish to pursue that shelter model in the future.”
Gloria’s office has publicly said the city is unlikely to pursue a shelter there – even after the Middletown shelter plan collapsed. McMillin said Gloria has privately said the same.
But McMillin said the inclusion of the large tent shelter in the permit application rattled investors and lenders tied to the planned third hotel. For a time, he feared a lender would bail on the project, a concern that ultimately didn’t play out.
The Coastal Commission ultimately approved the permit last July despite protests from McMillin. Frustrated, the developer filed suit in September.
Emails obtained by Voice show attorneys for the city and McMillin were trying to work out a settlement by this January.
Senior Deputy City Attorney Jana Mickova Will wrote in an email that the city might be willing to state in an agreement that it doesn’t “in good faith anticipate” installing large tent shelters at H Barracks and to amend its Coastal Commission permit to reflect that. But she wrote that that the city couldn’t “bind council’s future discretion as you seek because that would be unlawful.”
And Will added: “Regarding police response, no public agency can anticipate or guarantee police response times, but McMillin obtained several prior assurances from the mayor and the third hotel was able to secure financing as a result.”
Mark Zebrowski, an attorney representing McMillin, argued that the City Council doesn’t have discretion over the H Barracks site due to the past agreement with the federal government. He contended a settlement would allow the city to deviate from that prior decision and use H Barracks for safe parking for “an agreed time period.”
Zebrowski also noted that McMillin would no longer seek the lease extensions it had proposed months ago – and that if McMillin prevailed on any of its claims, the court could decide the city can’t serve homeless residents at H Barracks.
A few hours later, Will shut down negotiations.
“Hi Mark, we disagree with your legal conclusions and are going in circles,” Will wrote. “I recognize we will not resolve this by settlement.”
Almost two months later, McMillin sought an injunction to stop the project – at least temporarily.
“This case is not a challenge to the city’s exercise of its discretion; it is a challenge to the city’s disregard of controlling federal, state, and its own municipal law,” McMillin attorney Anders Aannestad wrote in a March 24 court filing. “Finally, no equity will be served for the city, its taxpayers, or homeless individuals if the city spends the money to maintain and temporarily operate the site only to have it shut down when the court issues a judgment in this case.”
Gloria isn’t backing down.
“The city does not consider McMillin’s legal position on this matter to be correct,” Gloria wrote. “Nevertheless, we engaged with the company and their hotel investment partners to assuage their concerns and reassure them that the operation of a temporary safe parking lot would in fact benefit the local community, which is currently experiencing impacts of street homelessness.”
The mayor argued that McMillin’s past settlement requests were unreasonable, especially the once-proposed lease extension.
“McMillin sought to exploit the city’s need to provide temporary emergency safe parking to hundreds of San Diegans living in their vehicles in order to extort a sweetheart deal on two hotel site leases,” Gloria wrote. “Secure in our legal position regarding use of the site to temporarily serve people experiencing homelessness, the city declined to give up substantial land value in order to avert their threat of a legal challenge.”
McMillin and Faucett pushed back in statements sent to Voice, noting that police responses to issues tied to homelessness have often been delayed and that the company’s engagement with the city has been well intended.
Faucett wrote that McMillin requested market-rate lease extensions to “help offset anticipated depreciation in investment value” it expected due to H Barracks. She argued the goal was to avoid significant financial burdens on the city while also addressing concerns McMillin and its investors had.
“Our request to the city was not for special treatment or a ‘sweetheart deal,’ but simply to work together to ensure the site is safely managed and compatible with the surrounding community,” Scott McMillin wrote. “It is disappointing that the mayor would characterize our good-faith efforts to raise legal and operational concerns as anything other than what they are: an attempt to be a responsible, long-term partner in this community.”
That dispute is now set to play out in Superior Court later this month. Both sides say they are ready for the fight – and expect to prevail.
“Right now, there are hundreds of people living in their vehicles within a few miles of the H Barracks site, and opening this lot is an opportunity to return those spaces to the public while providing the people living in their vehicles a safe place to park and support to help them end their homelessness,” Gloria wrote.
At Gloria’s direction, the city has continued preparations to open the H Barracks site amid the threat of an injunction.
The city reports that it has addressed grading issues with the lot, laid asphalt and painted on striping and markings. It has also installed lighting and electrical service, new fencing, gates and other amenities to support the project. It expects to wrap up construction this month – and it’s now proposing a contract with nonprofit Jewish Family Service of San Diego, which runs the city’s other safe parking lots, to operate the lot from 6 p.m. to 7 a.m. seven days a week. The proposed contract will be heard by the City Council’s land use committee on Thursday.
What happens when San Diego runs out of space for vehicle dwellers? It’s already out of control.
If the need for safe places for the homeless to stay is such a great idea, I can think of two places they can be setup: Right next to city hall, and on Todd Gloria’s street next to his home. This is getting ridiculous, homeless do nothing but bring down the value of the neighborhood you stick them in. McMillian is correct that they have invested millions into making Liberty Station a thriving area, and for the city and specifically Todd Gloria to berate someone that has only done good in the community is disrespectful and shows his complete and utter lack of understanding of how the real world works.
When you are dealing with two people with the same status as child killers in prison the only hope is that they take each other out simultaneously. Neither party is trustworthy, reliable or honest.
Second that motion! Beyond City Hall! District Leaders have a responsibility to tackle issues that leak beyond City Limits such as homeless. I only hear Desmond trying to find sensible solutions.
Time to start making the popcorn for this one.
85 percent of eligible voters did not cast a ballot on Tuesday. Think of an election without the media. The candidates would be turned upside down. Those without a chance in hell would suddenly be welcomed in the promised land. I’m an old now, been in San Diego since 1967 and have seen it all. I’ve run at least 14 times for local office. I lost track, maybe I’ve run 20 times. It doesn’t matter really. The people on this thread who espouse humanity, empathy and fiscal responsibility almost never vote along those lines otherwise we would not be in such dire straits in San Diego.
It’s obvious why you haven’t been elected…
Thanks for the laugh! I suppose your ignorance has a place somewhere. it’s obvious that you are an American true-blue idiot! LOL Just another bottom dweller without an anchor. Get lost! Good riddance!
True blue idiot? What the he’ll does that mean?
This is Daniel Smiechowski who wrote that. He’s a mentally ill Bay Park resident who seeks office every cycle, trolls social media, gets about 2 percent of the vote, and then does it again. Rocky de la Fuente was the same way.
No need to engage.
The only reason you dont win is because you dont know the winning strategies. Reds used to run a good race but Blues learned from it and shook the Reds but then Honorable President took it back! 🇺🇸
Please don’t allow 🙏🏼.
Homeless people move there it is a ridiculous idea.
We pay big money to live here and their are sooo many other places that they can be placed.
😂😂😂 yeah, historically all Districts have Voted to place homeless in Barrio Logan next to Perkins School. But with ballpark, the homeless
Industrial complex also felt the burden of displacement and gentrification.
Whats benefits citizens from Hotel development? 🏙️
What is the ROI on the Homeless Industrial Complex?
Can only think of Gov Deficit.
What does the HHSA have to say about the topic of homelessness?