Atascadero to get hotel near former Walmart site 

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It’s safe to say that not much has gone as planned for Atascadero at the “Del Rio Marketplace,” a vacant commercial site at the north end of the city at Del Rio Road and El Camino Real.

For nearly a decade, the city planned around a Walmart store being the revenue-generating centerpiece of the shopping center. But after years of delay due to a lawsuit and other hiccups, in February, Walmart announced it’d withdrawn its plans for the store, citing a shift toward an online retail model.

Atascadero is now receiving its first new development proposal for the site—but not one it expected: a 120-room, four-story Hilton hotel proposed by developer Madonna Enterprises.

“It’s a first big project we’re seeing in the Del Rio Specific Plan,” Atascadero Community Development Director Phil Dunsmore told City Councilmembers at a July 11 meeting.

Clint Pearce, president of Madonna Enterprises, purchased 13
acres of the “Del Rio Specific Plan” in 2013—when Walmart was still in the picture—with an original plan to develop it for commercial/retail uses.

But Pearce decided to switch gears and propose a 1.8-acre
hotel to kick off development instead.

“The evolution of retail is partly why we made this pivot on
this site,” Pearce said. “It became clear we needed to do something different
on this parcel.”

The Atascadero City Council unanimously voted on July 11 to approve
the conditional use permit for the hotel and amendments to the Del Rio site plan and its environmental impact report.

City officials said the new hotel would not trigger the need
for traffic infrastructure improvements in the area. Additional development would require construction of a roundabout at Del Rio Road and El Camino Real, followed by Highway 101 interchange improvements. The timing of those triggers is still unclear to officials.

“Right now, this is the only project we have at the table,”
Dunsmore said. “We don’t know the timing of development of other parts of this project.”

Mayor Tom O’Malley said he thought the hotel was a safe
financial bet for Atascadero.

“The situation looks like we’re going to not have to put a
lot out from the city’s standpoint on infrastructure and we’ll see an income
stream coming in. That’s good,” he said.