New 6-Story Hotel Planned Near Murrieta's Loma Linda Medical Center

MURRIETA, CA — Discussions at Murrieta City Hall about a new six-story, 131-room hotel planned next to Loma Linda Medical Center are progressing, and on Tuesday City Council will review a revenue-sharing strategy designed to help spur the project.

The City Council will decide whether to draft a Transient Occupancy Tax Revenue Sharing Agreement with project developer 3 Thrones Hospitality, LP, for a proposed Hilton Homewood Suites located on a 2-acre vacant lot just south of the hospital.

Transient Occupancy Tax, or TOT, is a tax charged to lodgers. The TOT money typically goes to local jurisdictions — in this case Murrieta.

Under the proposed revenue sharing agreement, once the hotel opens the city would let 3 Thrones keep 50% of the TOT collected until $1 million is received by the developer. It's estimated the threshold would take about three years to reach, according to city documents. After that point, all TOT from the hotel would go to the city.

3 Thrones is asking for the agreement because investors are wary of hotel projects due to the COVID-19 pandemic that saw a travel halt, supply chain problems and other issues, according to city documents.

During Tuesday night's City Hall discussion, it's likely the proposed up-front revenue-sharing deal will be considered against future revenue projections. Gross revenues of approximately $70 million are projected to be generated in the first 10 years of the hotel opening, according to developer calculations. The city would see approximately $6,958,661 in TOT revenues in the same period, according to the developer.

Prior discussions about the hotel project included input from Loma Linda University Medical Center, according to the city. The hotel would offer temporary living space for hospital staff, traveling staff and local residents. As such, it would feature larger suites and apartment-style living units, city documents show.

The hotel would match the needs of the nearby hospital and provide a "substantial" economic boost to Murrieta, according to the city. Tourism is identified as an "economic development goal" in the city’s General Plan. A dominant mission of the City Council is to "aggressively pursue economic development," according to city documents.

Even if City Council moves forward on the revenue-sharing agreement, the developer has other hurdles to cross, including environmental concerns and a number of other city approvals.

Tuesday night's Murrieta City Council meeting begins at 6 p.m., 1 Town Square. See the full meeting agenda here.