The Palms Hotel at 12th and Island downtown (originally known as the Bay View and reportedly San Diego's oldest continuously operated lodging) and Hillcrest's similarly rundown Friendship Hotel are being purchased by the same Newport-based investment and management company. The Friendship once served as a nurses dorm for the nearby hospital. By the turn of the 21st century, in the two Friendship buildings across the street from each other on 8th Avenue, minimally furnished rooms could be had for as little as $20 nightly. The current operator says he's been managing the Friendship for 22 years.

The Palms and the Friendship will undergo extensive renovation and refitting. The investor is known for cleaning up distressed properties and adding kitchens and bathrooms, to remove them from SRO status and, eventually, selling the entire operation. The same investment firm is in the process of redoing downtown's Windsor Hotel on 4th Avenue between E and F, built in 1887 and located across from the Balboa Theater. According to one insider, obtaining permits for work on the Windsor (long ago broken up into very small rooms) was "a nightmare." The renovation completed over the past few months has included adding bathrooms and kitchens to the rooms. The Windsor also houses Bandar Fine Persian Cuisine, open since 1996.

As deal details are finalized, some work at the Friendship has already begun, with several floors and walls torn down to the framework. One witness reports workers delicately removing what was described as a "ten foot snake" from one of the uncovered floor frames.

The land at 12th and Island on which the Palms Hotel sits was originally occupied by the modest one-story Bay View Hotel. According to a San Diego Tribune article dated February 28, 1938, it was “One of San Diego’s first hotels, built soon after Father Horton came here in 1868…it was the social center for the young city in its day, the scene of many parties, the terminal for the stage [transportation] lines.” The structure is first referred to in an 1874 city directory, though it was reportedly already built in 1869.

In the 1870s, the Bay View was on the outskirts of town, with little around it other than the home of San Diego's earliest Civil War veteran Matthew Sherman, in what became known as Sherman Heights. When Pennsylvania oil, hotel, and lumber magnate Joseph Collins arrived in San Diego in 1886, he purchased the Bay View Hotel from owners Jones and Dillingham. His ad campaigns attempting to attract guests touted its locale as “the most sightly and healthiest part of town.”

Alonzo Horton in front of the Hotel circa 1895 (courtesy "Vintage San Diego The Group" Facebook page)

It is said Wyatt Earp and his third wife Josie stayed in a second-floor corner suite at the Palms Hotel in 1886 and 1887, while operating gambling saloons near 4th and Broadway. There are still several bullet holes in the ancient wood above the original reception desk that are colorfully (but erroneously) credited to one of Earp’s indoor shooting sprees.

During his time at the Palms, Earp listed himself in city records as a “capitalist,” leasing concessions at several gambling halls, operating the Oyster Bar in the Louis Bank Building at 837 5th Avenue, buying some land in Hillcrest, hanging out at the Tivoli Bar on 6th and Island, and turning up around town at boxing matches, some of which he supposedly refereed.

The Bay View was not torn down to make way for the gigantic and ornate multistory structure seen in popular picture postcards. The hotel was rebuilt in 1889, or rather built-over, resulting in the additional floors, though elements of the original building remained within the interior. Those two towers seen in the first photos were later added atop the hotel’s southwest side, including a widow’s walkway, later to be later deconstructed, leaving only a flat tar-papered rooftop.

Original one-story Bay View, before it was lifted and incorporated within the new structure built around it - elements of the old building can still be found in the hallways and rooms

“What you see on the outside is the 1889 Hotel, within it is the 1869 Hotel,” SOHO executive director Bruce Coons told the KPBS show San Diego Historic Places in an October 2009 episode. “In 1889, they jacked it up, put it on the second floor, and put a dining room underneath it.”

The original entrance to the 1869 Hotel can still be seen in an inside hallway, an open doorway flanked by the original glass side panels. “That would have been the front entrance that’s now on the second floor,” says Coons. “It was down on the street originally.”

Another hallway has a section of the original exterior wall uncovered, with its original wood siding and window frames (now blocked off). “There would have been six-over-six window sash in these window openings at the time. You can still see when you look out this window [at the end of the hallway] and see the rest of the hotel that extends out the back of the 1889 hotel.”

In competition with the U.S. Grant Hotel, the Bay View was one of the main social centers of early San Diego, the place to go for locals of affluence who enjoyed the ornate décor, lavish top floor views, or who wanted to rent a horse and buggy at the nearby carriage house or eat mint-soaked lamb and calf’s tongue at a high falutin’ eatery within spittoon-hitting distance of the Bay View’s expansive wraparound porchfront.

When builder Collins died in 1913, the hotel was sold and rechristened the Palms, named after the giant Queen Palm trees already breaking out of the perimeter sidewalks on all four sides of the building.

In 1972, the hotel was purchased for $200,000 by a consortium of developers, although little if anything was done to improve or even keep the property up. It was later owned by Bill Reed, a retired San Diego fire captain.

By the late 1970s, as I can attest from my own stay at the Palms, the upper branches of those palm trees housed what sounded like half a billion noisy birds, whose chirping at sunrise and sunset could drown out planes landing at the airport. The faded interior of the Palms can be seen at length in the 1979 Chuck Norris film A Force Of One, including the lobby and inside one of more rundown rooms (where Norris beats up a druggie).

Chuck Norris and friend enter the cavernous Palms lobby in the 1979 film A Force Of One

In May 1985, L.A. attorney Robert Ballantyne, representing financier Robert O. Peterson, paid around $1 million in behalf of a trust for most of a block at 12th and Island. One of Ballantyne’s partners in the development of a downtown seniors tower called San Diego Square, Mavourneen O'Connor (twin sister of Mayor Maureen O'Connor), was reported by the Union-Tribune as a frequent Palms visitor, sparking speculation that the building might be converted into senior citizen housing.

However, by July 1986, plans were instead implemented to upgrade the Palms and raise rents from an average of $200 to more than twice that amount; around two dozen eviction notices went out to tenants.

“They’ll literally turn it into a true hotel,” San Diego attorney Stephen Huggard told the Union-Tribune (7-24-86), representing the owners. By the end of the year, the building was undergoing a major renovation, from repainting to consolidating rooms, replacing common areas with additional rooms installed with private fixtures, and putting up real drapes over all the huge vertical Victorian bay windows previously covered only by paper window shades.

By 1991, few rooms at the Palms would have been considered priced for “low income” residents. There were a few exceptions on the second floor, thanks to a program initiated by Episcopal Community Services.

I took these photos of the Palms twenty-five years apart, 1979 and 2004

As of 1996, a woman named Glydia and her son Dave were running the Palms and were getting $400 or more monthly for the more stately rooms where I once lived for $110 per month.

Fast forward to 2009, when the Hotel’s owner, Mission Federal Bank in partnership with John Cook, put the Palms up for sale.

Photo from 2009 real estate listing

In October 2009, Sandor Shapery, a board member of SOHO, announced his plan to purchase the Palms Hotel via his company Shapery Enterprises. The hotel maintained its SRO/single room occupancy status, but apparently it wasn't the success that Shapery had hoped for.

A January 22, 2011 Union-Tribune article listed the Palms Hotel among eleven “Foreclosed Hotels in San Diego County.”