Pacific Edge Hotel Redevelopment Moves Into Construction Phase
The 93-year-old oceanfront property keeps 136 rooms and gains an automated parking garage as demolition work begins after a long entitlement battle.
One of downtown Laguna Beach’s oldest hotel properties has entered its construction phase. The Pacific Edge Hotel at 647 South Coast Highway, a 93-year-old oceanfront property, is being substantially renovated under a plan that retains 136 hotel rooms while updating public areas, restaurant and pool facilities, according to local coverage of the project.
The defining feature of the new plan is a multi-level automated parking garage with room for roughly 220 vehicles, replacing two surface lots. The garage would total about 58,476 square feet, with vehicular access relocated to Sleepy Hollow Lane, according to the entitlement records.
The Laguna Beach Planning Commission approved the amended project last November, granting design review, an amended conditional use permit, a coastal development permit, an encroachment permit and a variance for elevators that exceed code height limits. The approved room count is 20 rooms fewer than previously entitled.
The project has not been without friction. A previously proposed rooftop public retail pavilion was swapped for a private, lower-profile roof garden to reduce height and view impacts, and the hotel’s coastal development permits were called up to the California Coastal Commission for review. In a January 2026 update, the city noted the hotel had two construction-related appeals before the Coastal Commission that had to be addressed before renovation and reopening.
The redevelopment displaced the property’s well-known oceanfront food and beverage outlets. Driftwood Kitchen and The Deck, built by restaurateurs John Nye and Chef Rainer Schwarz, closed after Labor Day, ending about a decade of service. A new luxury resort aimed at high-end travelers is expected to take shape in about three years.
Logistics alone made headlines this summer. The developer had proposed using the Laguna Terrace parking lot in South Laguna, about two miles south of the hotel, as a remote construction staging site for workers, materials and equipment. After nearly two and a half hours of testimony and debate, the Planning Commission approved only a pared-back parking use.
The project’s environmental review says operation of the renovated hotel would not require new employees: hotel staff would remain around 30 per shift of no more than 20, with 65 restaurant employees and no more than 50 total on site at any given time. Construction would be limited to weekdays between 7:30 a.m. and 6 p.m. under the city’s municipal code. For the lodging market, the project preserves rather than expands room supply: 136 rooms in a town where new hotel rooms are effectively impossible to entitle from scratch. The automated garage, a rarity on this coast, signals how much parking math now drives Laguna hospitality deals.
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