Even as hotel development slowed across the state, San Diego County saw a surge in hotel openings in 2025, driven by the debut of the 1,600-room Gaylord Pacific Resort in Chula Vista.<\/p>\n
The Gaylord hotel is so large that it almost singlehandedly helped boost statewide hotel real estate performance last year. The megaproject effectively made California totals look especially strong, despite relatively modest levels of new hotel room supply in several other counties, reports Atlas Hospitality Group, which released its year-end development report on Thursday.<\/p>\n
Statewide, 50 hotel projects accounting for 7,100 rooms debuted in 2025, compared with 35 properties consisting of nearly 3,800 rooms a year earlier. The contrast was even more marked in San Diego County, where a total of five hotels accounting for 2,034 rooms opened last year, compared with just a single 179-room property opening in 2024, reported Atlas, an Orange County-based brokerage and advisory firm specializing in hotel properties.<\/p>\n
Besides the Gaylord resort, other newly opened hotels in the county included Jamul Casino\u2019s first hotel and the Sentral Gaslamp Quarter, which has 135 furnished apartments with hotel-style amenities, designed for short- and long-term stays.<\/p>\n
Despite the higher volume of rooms coming online in 2025, the number of newly opened properties locally is slightly below average, compared to the past several years. In 2018, for example, there were seven new hotels and in 2019, there were 10, says Atlas Hospitality.<\/p>\n
At the same time, new development continues to slow in San Diego and elsewhere, with 11 hotels under construction last year, compared with 13 in 2024. For Southern California as a whole, 59 properties were in the construction stage last year, compared with 71 in 2024.<\/p>\n
\u201cThis is happening because investors can buy existing hotels right now at a fraction of the replacement cost,\u201d said Atlas Hospitality President Alan Reay. \u201cSo you have potential developers looking at San Francisco, Silicon Valley, Los Angeles, where they can buy existing hotels way below replacement cost.<\/p>\n
\u201cAnd then when you figure in tariffs and everything else, construction costs become very high, so it\u2019s difficult to develop. It\u2019s not just the construction costs, but you also have to provide the fixtures and equipment and furnishings, which are all imported from China, so the tariffs have had a huge impact on costs.\u201d<\/p>\n