In a groundbreaking decision that demonstrates a strong commitment to collaboration between the city and the military, the Port of San Diego and the U.S. Navy have secured a deal to end the Navy's lease at 1220 Pacific Highway 27 years early. This opens up numerous opportunities for public access, recreational activities, and commercial development in the prime waterfront area of San Diego Bay.

Since 1949, the Navy has leased the 3.4-acre site, primarily for office uses. When the Port was established in 1962, it inherited the 100-year lease from the City of San Diego. The deal negotiated between the Port and the Navy paves the way for new park spaces, open areas, better access, and more vacation and staycation choices in the highly coveted bayfront area.

Rafael Castellanos, Chairman of the Port of San Diego Board of Port Commissioners, heralded the agreement as a historic moment. "We are thrilled we have a deal with the Navy that means there will soon be more for visitors and our communities to enjoy and experience along our San Diego Bay waterfront," he said. Both Congressman Scott Peters and Mayor Todd Gloria were also credited for their advocacy in this transaction.

This isn't the first time the Port and the Navy have joined forces for a positive outcome. In 2022, the two agencies signed a first-of-its-kind agreement granting the Navy access to California's Low Carbon Fuel Standard (LCFS) market. The partnership provided the funds required for electrification projects around San Diego Bay. The Port and Navy cooperated on natural resources management and coordinated sea-level rise initiatives as well.

As part of an executed Lease Termination Agreement, the Port will provide $5.75 million in improvements to the Navy, allowing for facility or support service enhancements. In turn, the Port will work to deliver new public access and recreation spaces, including, extending Lane Field Park, adding more visitor-serving facilities, and improving mobility connections. Although up to four years of planning is anticipated for the development opportunities, the Navy will be allowed to continue using the property during this transitional time.

Rear Adm. Brad Rosen, Commander of Navy Region Southwest, acknowledged the significance of this agreement for both parties. "The Navy negotiated with the Port on an agreement that meets our requirements while accommodating the Port's interest for redevelopment," he said.

The historic deal was met with praise by those involved. Representative Peters emphasized the importance of the San Diego-Navy partnership and the treasurer the redevelopment will bring to commercial and public interests. San Diego Mayor Todd Gloria expressed his gratitude for the Navy's commitment to the region and the mutually beneficial relationship that has lasted over a century.

The North Embarcadero, referred to as San Diego’s ‘front porch,’ has evolved into a great attraction for tourists and locals alike with popular restaurants, museums, bay cruises, and hotels. The termination of the Navy's lease and plans for redevelopment are sure to add more allure to this already enticing waterfront destination.

As a non-taxing public agency, the Port aims to redevelop part of the site to increase revenue, enabling reinvestment back into the waterfront. This includes funding public amenities, services, environmental protection, conservation efforts, and public safety.