There’s a hotel boom happening in San Luis Obispo.
With 42 hotels now in the city, the recent surge can be attributed to one thing: tourism.
“Tourism is a huge economic driver for San Luis Obispo and our region at large,” said Jacqui Clark-Charlesworth, the city's tourism and community promotions manager.
In the 2018-19 fiscal year, pre-pandemic, the transient occupancy tax collected from all lodging businesses in the city of San Luis Obispo was just over $8 million. In 2022-23, it was more than $11 million, which local tourism experts say shows that there is a need and benefit to more hotels.
“We're really growing the pie," said longtime Madonna Inn property manager Clint Pearce. "There's a lot more opportunity and these new properties coming online, obviously they're brand new properties.”
Pearce has been involved with the Madonna Inn since 1990 and has seen the shift with more brand-name hotel chains like Hilton and Marriott entering the area. The most recent addition was the former independently-owned Hotel Cerro which recently came under new ownership and was added to the Marriott Autograph Collection.
“They have great programs for independent or boutique properties to move over into their brand,” Pearce explained.
With 10 already in the city, Clark-Charlesworth explained that the brand names are helping draw more traffic thanks to their consistency, loyalty programs and brand recognition.
“They have loyal audiences. They have visitors that sometimes choose where they're going based on where a hotel that they're a member of operates."
But independently-owned hotels still dominate the space with 32 of them in the area like the Madonna Inn and Hotel San Luis Obispo that provide customers with a unique experience
“We like to delight guests in our own way, and that works for us, but it doesn't work for some others,” Pearce said.
So if you’re wondering why there are more and more hotels going up, it’s because of demand.
“It's our region really becoming discovered both by guests and investors alike seeing this is a great opportunity in the travel and leisure market.”
Other hotels scheduled to be built or under construction:
- Residence Inn/SpringHill Suites by Marriott at San Luis Ranch — 200 rooms; anticipated completion date: Spring 2025
- San Luis Square — 36 rooms. This project has multiple phases/buildings. The permit application for the hotel building has not yet been submitted. Other buildings are already under construction.
Other hotels in the pipeline:
- Motel Inn off Highway 101 at the old historic “first motel” site. In building permit review; includes 83 rooms
- SLO Airport Hotel (950 and 990 Aero Drive) — In building permit review; includes 204 rooms
Editor's Note: A previous version of this article incorrectly stated Clark-Charlesworth's title. This article has been updated with the correct title.
