Hotel Online Special Report 
Highlights of the SS Lurline Hotel Project; Representing Preservation and Restoration of the Oldest Existing Ocean Passenger Liner Highlights of the SS Lurline Hotel Project
Development Plan: Renovate the ocean liner SS Lurline as a 258 room hotel ship permanently berthed on the San Francisco Northern Waterfront. This project has a number of unique and positive benefits:
1. A superior waterfront location. The SS Lurline will be berthed at Pier 35 North (next to PIER 39). This is the site of the current cruise terminal, which was originally built to service the SS Lurline, and other Matson Line ships. There are spectacular views of Alcatraz, the Golden Gate Bridge, the San Francisco Skyline, and the surrounding Bay Area. The immediate area is a center of day use tourist activity with over 10 million visitors a year.
2. A competitive advantage and protected position. In San Francisco there are no land-based hotels on the waterfront, and never will be. This is prohibited by Proposition H that was passed by the voters in 1970. The exception is for historic ships, which is how we expect the Lurline to qualify. The developer has identified this opportunity and secured the ship.
3. Long term lease. The Port of San Francisco has offered a 55-year lease at Pier 35.
4. On board amenities and character. The ship profile and onboard amenities are those of a classic liner. It conveys an age of elegant travel and hospitality. Dramatic public areas include high ceiling ballrooms, sun decks, and outdoor promenades.
5. The Ship is in good condition. The SS Lurline was in service until about three years ago and has been well taken care of at its current berth in Tampa.
6. Strong Market. The San Francisco hotel market is extremely strong in all sectors. Both occupancy and average daily rates are at high levels and increasing.
7. Port of San Francisco and Political Support. The developer has entered into a Memorandum of Understanding with the Port covering lease terms and conditions. Port staff and commissioners have expressed strong support and the project has received favorable comment from both major newspapers.
8. Outstanding Financial Performance. Our preliminary analysis of costs and revenues shows a projected annual operating income of $10.7 million and an IRR of 57% after financing. There is substantial potential from catering special events, weddings, and corporate functions on the decks and spacious public areas.
9. Reasonable Ship Renovation Cost. Whereas preliminary cost estimates have been made and appear reasonable, they need to be verified. We are looking at a total cost of around $40 million for 258 rooms. This is substantially below new construction costs in San Francisco. A secondary element is that there is little or no seismic risk.
10. Excellent Timing. We believe that the ship can be renovated and be open within 18 months. Shipyards are accustomed to work quickly on refit and renovation projects. Doing a land based project would take 5 to 10 years if land and approvals could be obtained.
11. Spacious Room Configuration. In the reconfiguration plan, staterooms will be renovated to meet modern hotel customer requirements. The 700+ smaller cabins will be combined to create 258 spacious stateroom suites of 250 to 450 square feet. In addition, the stateroom windows and portholes will be replaced and enlarged.
12. Built in Meeting Space and Cinema. San Francisco is a great meetings market and the property should appeal to the small corporate meetings and incentive market. The ship renovation plan provides substantial meeting space. It also has an existing theater that is excellent shape and can be used for group events or evening cinema.
13. Large Capacity Public Spaces and Back of House. Since the ship was designed to handle a passenger complement of over 1,500, there is a large amount of capacity in the public spaces, kitchen, and back of house operations. The kitchen, in particular, is in excellent shape. Additionally, the large open and covered decks provide recreation and relaxation areas that can not be duplicated in another San Francisco hotel.
14. Rich History of the SS Lurline. Hundreds of thousands of people sailed on the ship from San Francisco to Hawaii and she is fondly remembered by past guests. Memorabilia from the Matson ships have become desirable collectors’ items.
15. Urgency. It is important to move quickly in order to limit the costs of berthing the ship and take advantage of the favorable approval conditions and attitudes at the Port
More About Project Lurline Project Lurline represents the preservation and restoration of the oldest existing ocean passenger liner in the world as a showpiece along the revitalized San Francisco Waterfront. We envision a showcase project that will attract both San Franciscans and visitors, allowing once again, increased human interaction and day to day contact with maritime related uses along the waterfront. Additional benefits will include but not be limited to open access to the waterfront for the public, free admission for all citizens of San Francisco and its visitors, rehabilitation of the existing pier structure, job creation and substantial economic and employment benefits to the Port and City.
To understand why this project is a natural fit for the Northern Waterfront, some history is helpful. The ss Lurline is the most well-known passenger ship in the history of the Port of San Francisco. For decades, she was the best known liner operating out of San Francisco to the Pacific. From the early 1930’s to the early 1970’s, the Lurline was a regular visitor to the Port of San Francisco and is fondly remembered by many as the scene of bon voyage parties and grand sailings with bands playing and streamers flying. The Lurline was homeported in San Francisco her entire life, with most of her crew drawn from San Francisco and the Bay Area. Lastly, Matson Navigation Company was, and still is, headquartered in San Francisco, being one of the oldest companies in San Francisco with a proud heritage stretching back over a century. Also of note is Lurline’s splendid wartime record as a troopship, carrying hundreds of thousands of US and Allied troops to and from the Pacific Theatre.
We propose that the Lurline is to be located along the Northern Waterfront as a permanently docked cruise ship offering a distinctive and localized ‘Ocean Liner’ ambiance to San Franciscans and visitors. It is our goal to make this ship once again a vibrant and integral part of life in San Francisco. In an era when no modern cruise ships allow visitors aboard while in Port, we will offer open access, encouraging city residents, school children and visitors to once again board a liner along the Embarcadero for a tour of our maritime history museum, which will explain not only the history of the Lurline and its link to San Francisco but also the history of the Port and shipping in San Francisco in general. For the first time in decades, it will be possible to board a real liner for an evening of dancing, dining and entertainment, all in a carefully restored, historically accurate setting.
While the ship will not be on Port of San Francisco property, it will be berthed for the duration of the property lease at a pier. This will require a berthing agreement/lease to be negotiated with the Port of San Francisco.
The Project Lurline complex will consist of
- Existing pier facilities with open access for the general public.
- 250-room ocean liner deluxe four star hotel.
- Limited meeting room venues.
- Public restaurant/nightclub facilities/food & beverage outlets.
- Free maritime museum/exhibit
The Project team for ss Lurline is made up entirely of San Francisco and Bay Area residents, all with long links to the waterfront, historic preservation and shipping. It is critical to us that the quality of the final product be commensurate with the historical significance and importance of the Lurline, as well as with the setting on the Northern Waterfront. A great deal of the repair work and refit of the ship will be done here in San Francisco at San Francisco Drydock Company, another port tenant, providing hundreds of union pre-opening jobs for shipyard workers, local artisans and craftsmen and construction workers. It is our intent to work closely with the Port, community groups and other interested parties to insure a showcase product in which everyone can take pride. This commitment to working with the community extends to such issues as a transit first policy, union representation and environmental sensitivity. Not only will the ship have a San Francisco flavor and ambiance, but it is our preference to have local operators for the full-service restaurant and hotel facilities onboard.
The economic benefits from a permanent docking of ss Lurline along the Embarcadero are tremendous. In addition to hundreds of pre-opening shipyard and construction jobs, the ship will employ approximately two hundred seventy five employees, making a substantial contribution to the local economy. Additionally, ss Lurline will immediately be the Port’s largest tenant in terms of income while utilizing berthing that has not yielded substantial income for decades. Last but not least, with a careful restoration and refit to its pre-war grandeur and the maritime museum, ss Lurline will provide another waterfront attraction venue not replicated by nor competing with, any other existing business in San Francisco or the northern coast of California.
While this project could be accomplished in any port in the world, there is nowhere else in the world that we would prefer to do this project in, restoring ss Lurline to her old home and creating a showcase that will once again grace the City’s northern waterfront.
ERA is introducing the project to a very few hotel operating companies, investors, and individuals that may have the corporate culture and experience to appreciate a different approach that could give competitive advantage and relatively immediate entry into the San Francisco market.
1. A superior waterfront location. The SS Lurline will be berthed at Pier 35 North (next to PIER 39). This is the site of the current cruise terminal, which was originally built to service the SS Lurline, and other Matson Line ships. There are spectacular views of Alcatraz, the Golden Gate Bridge, the San Francisco Skyline, and the surrounding Bay Area. The immediate area is a center of day use tourist activity with over 10 million visitors a year.
2. A competitive advantage and protected position. In San Francisco there are no land-based hotels on the waterfront, and never will be. This is prohibited by Proposition H that was passed by the voters in 1970. The exception is for historic ships, which is how we expect the Lurline to qualify. The developer has identified this opportunity and secured the ship.
3. Long term lease. The Port of San Francisco has offered a 55-year lease at Pier 35.
4. On board amenities and character. The ship profile and onboard amenities are those of a classic liner. It conveys an age of elegant travel and hospitality. Dramatic public areas include high ceiling ballrooms, sun decks, and outdoor promenades.
5. The Ship is in good condition. The SS Lurline was in service until about three years ago and has been well taken care of at its current berth in Tampa.
6. Strong Market. The San Francisco hotel market is extremely strong in all sectors. Both occupancy and average daily rates are at high levels and increasing.
7. Port of San Francisco and Political Support. The developer has entered into a Memorandum of Understanding with the Port covering lease terms and conditions. Port staff and commissioners have expressed strong support and the project has received favorable comment from both major newspapers.
8. Outstanding Financial Performance. Our preliminary analysis of costs and revenues shows a projected annual operating income of $10.7 million and an IRR of 57% after financing. There is substantial potential from catering special events, weddings, and corporate functions on the decks and spacious public areas.
9. Reasonable Ship Renovation Cost. Whereas preliminary cost estimates have been made and appear reasonable, they need to be verified. We are looking at a total cost of around $40 million for 258 rooms. This is substantially below new construction costs in San Francisco. A secondary element is that there is little or no seismic risk.
10. Excellent Timing. We believe that the ship can be renovated and be open within 18 months. Shipyards are accustomed to work quickly on refit and renovation projects. Doing a land based project would take 5 to 10 years if land and approvals could be obtained.
11. Spacious Room Configuration. In the reconfiguration plan, staterooms will be renovated to meet modern hotel customer requirements. The 700+ smaller cabins will be combined to create 258 spacious stateroom suites of 250 to 450 square feet. In addition, the stateroom windows and portholes will be replaced and enlarged.
12. Built in Meeting Space and Cinema. San Francisco is a great meetings market and the property should appeal to the small corporate meetings and incentive market. The ship renovation plan provides substantial meeting space. It also has an existing theater that is excellent shape and can be used for group events or evening cinema.
13. Large Capacity Public Spaces and Back of House. Since the ship was designed to handle a passenger complement of over 1,500, there is a large amount of capacity in the public spaces, kitchen, and back of house operations. The kitchen, in particular, is in excellent shape. Additionally, the large open and covered decks provide recreation and relaxation areas that can not be duplicated in another San Francisco hotel.
14. Rich History of the SS Lurline. Hundreds of thousands of people sailed on the ship from San Francisco to Hawaii and she is fondly remembered by past guests. Memorabilia from the Matson ships have become desirable collectors’ items.
15. Urgency. It is important to move quickly in order to limit the costs of berthing the ship and take advantage of the favorable approval conditions and attitudes at the Port
More About Project Lurline Project Lurline represents the preservation and restoration of the oldest existing ocean passenger liner in the world as a showpiece along the revitalized San Francisco Waterfront. We envision a showcase project that will attract both San Franciscans and visitors, allowing once again, increased human interaction and day to day contact with maritime related uses along the waterfront. Additional benefits will include but not be limited to open access to the waterfront for the public, free admission for all citizens of San Francisco and its visitors, rehabilitation of the existing pier structure, job creation and substantial economic and employment benefits to the Port and City.
To understand why this project is a natural fit for the Northern Waterfront, some history is helpful. The ss Lurline is the most well-known passenger ship in the history of the Port of San Francisco. For decades, she was the best known liner operating out of San Francisco to the Pacific. From the early 1930’s to the early 1970’s, the Lurline was a regular visitor to the Port of San Francisco and is fondly remembered by many as the scene of bon voyage parties and grand sailings with bands playing and streamers flying. The Lurline was homeported in San Francisco her entire life, with most of her crew drawn from San Francisco and the Bay Area. Lastly, Matson Navigation Company was, and still is, headquartered in San Francisco, being one of the oldest companies in San Francisco with a proud heritage stretching back over a century. Also of note is Lurline’s splendid wartime record as a troopship, carrying hundreds of thousands of US and Allied troops to and from the Pacific Theatre.
We propose that the Lurline is to be located along the Northern Waterfront as a permanently docked cruise ship offering a distinctive and localized ‘Ocean Liner’ ambiance to San Franciscans and visitors. It is our goal to make this ship once again a vibrant and integral part of life in San Francisco. In an era when no modern cruise ships allow visitors aboard while in Port, we will offer open access, encouraging city residents, school children and visitors to once again board a liner along the Embarcadero for a tour of our maritime history museum, which will explain not only the history of the Lurline and its link to San Francisco but also the history of the Port and shipping in San Francisco in general. For the first time in decades, it will be possible to board a real liner for an evening of dancing, dining and entertainment, all in a carefully restored, historically accurate setting.
While the ship will not be on Port of San Francisco property, it will be berthed for the duration of the property lease at a pier. This will require a berthing agreement/lease to be negotiated with the Port of San Francisco.
The Project Lurline complex will consist of
- Existing pier facilities with open access for the general public.
- 250-room ocean liner deluxe four star hotel.
- Limited meeting room venues.
- Public restaurant/nightclub facilities/food & beverage outlets.
- Free maritime museum/exhibit
The Project team for ss Lurline is made up entirely of San Francisco and Bay Area residents, all with long links to the waterfront, historic preservation and shipping. It is critical to us that the quality of the final product be commensurate with the historical significance and importance of the Lurline, as well as with the setting on the Northern Waterfront. A great deal of the repair work and refit of the ship will be done here in San Francisco at San Francisco Drydock Company, another port tenant, providing hundreds of union pre-opening jobs for shipyard workers, local artisans and craftsmen and construction workers. It is our intent to work closely with the Port, community groups and other interested parties to insure a showcase product in which everyone can take pride. This commitment to working with the community extends to such issues as a transit first policy, union representation and environmental sensitivity. Not only will the ship have a San Francisco flavor and ambiance, but it is our preference to have local operators for the full-service restaurant and hotel facilities onboard.
The economic benefits from a permanent docking of ss Lurline along the Embarcadero are tremendous. In addition to hundreds of pre-opening shipyard and construction jobs, the ship will employ approximately two hundred seventy five employees, making a substantial contribution to the local economy. Additionally, ss Lurline will immediately be the Port’s largest tenant in terms of income while utilizing berthing that has not yielded substantial income for decades. Last but not least, with a careful restoration and refit to its pre-war grandeur and the maritime museum, ss Lurline will provide another waterfront attraction venue not replicated by nor competing with, any other existing business in San Francisco or the northern coast of California.
While this project could be accomplished in any port in the world, there is nowhere else in the world that we would prefer to do this project in, restoring ss Lurline to her old home and creating a showcase that will once again grace the City’s northern waterfront.
Contact: Clive Jones at 415-956-8152 ([email protected]) or Jay Pauly (tel. 415.956.3636 ext.112) developer’s website at http://members.aol.com/thelurline Also See: Resort Investment & Development / J. Richard McElyea & Gregory L. Cory / ERA Marriott Conference Centers on Short List for Development Within the Presidio, San Francisco / Jan 1999