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Council updates real‑estate policies on sales, nonprofit leases and acquisitions to strengthen due diligence
Summary
Council unanimously adopted revisions to Council Policies 710, 712 and 732 to increase transparency, extend appraisal validity, require due‑diligence reporting to the IBA and add safeguards on broker conflicts for city real‑estate transactions.
The San Diego City Council approved comprehensive revisions to three long‑standing policies governing city real‑estate transactions — Council Policies 710 (sale/lease), 712 (nonprofit leasing) and 732 (acquisition) — aimed at implementing multiple audit recommendations and improving transparency.
Director of Economic Development Christina Bibler and Deputy Director Lucy Contreras presented the changes, which include: extending appraisal validity from six to 12 months where appropriate; a Portfolio Management Plan to be presented to council every two years; requiring signed contracts and conflict disclosures for outside brokers and advisors; and an Acquisition Due‑Diligence Checklist that staff will attach to council reports on acquisitions.
The policy updates were supported by labor groups and some councilmembers who said the changes protect taxpayer assets; an industry coalition of lessees and the regional Chamber asked for more stakeholder discussion on specific Section 5 language regarding refinancing and reversionary interests. Robert Gleason of the San Diego County Lodging Association and partners urged the council to refine parts of Section 5 to avoid unintended economic consequences for long‑term leaseholders; Christina Bibler and staff said the council retains discretion to waive policy requirements for unique deals and invited ongoing stakeholder engagement.
Councilmember Von Wilpert and others pressed staff on how refinancing consent would be handled; Bibler said such requests would be evaluated case‑by‑case and the council could waive policy provisions when warranted. Councilmember Moreno pushed for a durable acquisition checklist and independent building condition assessments; staff agreed to include building condition assessments where applicable.
After discussion and a small technical amendment to include independent building‑condition assessments in the acquisition checklist, the council voted 9–0 to adopt the revised policies. The policies aim to close procedural gaps identified in prior audits (including high‑profile acquisition problems) and to require clearer documentation of due diligence to support future council decisions.
Next steps: staff will finalize the Acquisition Due‑Diligence Checklist as a supplement to Policy 732, provide required attachments to council staff reports and continue stakeholder conversations on implementation details.
