The operator of a beachfront racquet club collected tens of millions of dollars in revenue from tournaments and other events while paying the city just $50 a month to lease a dozen-plus acres in Ocean Beach, a new investigation has found.
The Barnes Tennis Center, the sprawling complex run by the Youth Tennis San Diego nonprofit, also ignored several city codes and lied about at least one violation, the San Diego City Auditor’s Office said in newly released findings.
“In 2024, the city ordered the lessee to immediately stop parking in an area that the lessee had illegally graded in violation of lease terms, permitting requirements and environmental laws,” the report says.
“Nearly a year after the city’s directive, the lessee sent a reply letter falsely asserting the area had been routinely used for parking since 1994 and proposing only to address required permits as part of new lease negotiations,” it added.
The findings of negligence and misconduct are not limited to the nonprofit, however.
According to city auditors, aides to Mayor Todd Gloria have not enforced a single code violation against the Barnes Tennis Center — or any city-owned property — even though a spate of violations have been confirmed.
“City representatives stated that the city does not formally investigate or take enforcement action against city lessees as it would for violations on private property,” auditors said. “A notice of violation was never issued, and fines were not imposed.”
The Barnes Tennis Center operates a host of tennis courts, pickleball courts and other sports facilities on 12.5 acres of city-owned property along West Point Loma Boulevard. It received the lease in 1994, and the $600 annual rent has not been raised since.
The 35-year deal is due to expire June 30, 2029.
San Diego city auditors said the agreement should be amended both to recognize the new amenities constructed by Youth Tennis San Diego and to make the rent more equal to the money the property generates.
“Newly revised city policies provide mechanisms to recover a portion of a nonprofit’s gross revenues and evaluate whether the nonprofit’s public benefit is commensurate with the lease subsidy related to newly issued or amended leases,” the report said.
The report from the San Diego City Auditor’s Office is not a formal audit. It is instead the product of an investigation that was undertaken following a call to the city’s fraud hotline.
But the findings do include three specific recommendations to city officials: Require the tenant to correct its lease violations, create a plan to enforce code violations against all city tenants and establish a market rate for the rent once the Barnes Tennis Center lease is renewed or extended.
Cheri Turner and Roger Leach play pickleball at the Barnes Tennis Center on Friday, Aug. 28, 2026, in San Diego. (Luke Johnson / The San Diego Union-Tribune)
The Gloria administration agreed with the proposed fixes and pledged to implement them over the coming months and years.
“The lessee recently submitted an initial proposal for the city’s consideration related to a potential amendment or future lease structure intended to address the compliance issues and uses currently occurring on-site,” the city wrote in its response.
“These negotiations are in the preliminary stages, and the city is currently evaluating the proposal.”
There was no response from Youth Tennis San Diego included in the 53-page report, and Barnes Tennis Center chief executive Ryan Redondo did not respond to a request for comment.
But former San Diego city manager Jack McGrory, who signed the original lease more than 30 years ago on behalf of the public and now serves as president of the charity’s board of directors, said the independent review was flawed.
“The audit was pretty irresponsible and pretty inaccurate,” he said. “They did not talk to Youth Tennis San Diego.”
McGrory denied the report’s finding that the tenant wrongly used part of the leasehold as a parking lot. He said city officials knew the lot had been improved with gravel as a way to control dust after complaints from neighbors.
“We’ve been using that overflow parking since 1996,” he said. “We consulted with the city engineers and we consulted with the real estate staff. We eliminated the dust issue.”
McGrory did concede the charity did not secure approvals before proceeding with the construction, however.
“We did not technically get a permit because we didn’t think we needed to,” he said.
The investigation does not specifically address the relationship between McGrory’s role as city manager between 1991 and 1997 and his subsequent role with Youth Tennis San Diego.
But the former city manager defended the long-term lease as practical for both sides because the 12-plus acres were little more than sand when the deal was reached in 1994 — and the tenant made all the improvements.
“That’s what we were doing in those days for nonprofits,” McGrory said. “We considered nonprofits to basically be partners.”
People practice on the court as a tennis ball sits stuck in the fence at the Barnes Tennis Center on Friday, Aug. 28, 2026, in San Diego. (Luke Johnson / The San Diego Union-Tribune)
Youth Tennis San Diego has collected more than $21 million over the five years ending in 2024, federal tax filings show. City auditors said San Diego should be collecting more of that revenue.
“Lease amendments appear to be necessary, which could significantly increase revenue to the city,” they wrote. “Our investigation found that the lessee’s revenues have increased roughly 400% between 2020 and 2024, reaching over $7.2 million in 2024.”
They also noted that the Youth Tennis San Diego chief executive is paid almost $300,000 per year — more than the entire payroll of the Balboa Tennis Club operating in Balboa Park.
The Barnes Tennis Center has expanded in recent years, adding pickleball courts and other amenities. The upgrades were funded in part with a $2.5 million advance from the city — money that was expected to be repaid by the state, auditors said.
But the city has been reimbursed only $260,000 so far — and the rest may be in jeopardy because the state grant rules required the tenant to obtain all of the needed permits, investigators said.
“The lessee obtained permits to install a solar photovoltaic system and tenant improvements to an existing locker room and restroom,” the report said. “However, no grading permits were obtained.”
The publicly funded renovations contributed to the explosive growth in charity revenue. The study noted the facility hosted the USA Pickleball National Championships in 2025 and 2026, along with other championship tournaments.
“As currently configured, the Barnes Tennis Center has been referred to as ‘the Disneyland of racket sports’ due to the variety of racquet sports and amenities available in one attractive coastal location,” it said.