Palm Springs City Council hears updates on two long-stalled hotel projects

The Palm Springs City Council on Wednesday received updates on two long-stalled hotels: the Dream Hotel near the Palm Springs Convention Center and the Orchid Tree Hotel downtown.

Both updates involved the performance timelines of agreements originally enacted in response to lagging progress on each project.

The Dream Hotel project was first approved as a mixed-use development featuring a hotel and residential condos in 2007. Over the past two decades, the project has gone through various iterations and stages of the planning process. In June 2017, a 170-unit hotel and 35 residential condos were approved for the site, though the unit mix has since been adjusted to 155 hotel rooms and 89 condos and townhomes.

The council approved an amendment to the 2023 settlement and development agreement between the city and Serene Palm Springs LLC, the project’s developer. The amendment includes more frequent milestone deadlines and more formalized community outreach commitments, such as monthly neighborhood meetings, maintaining a project website, and providing regular updates about the project’s timeline. The developer is also required to maintain the project site during the pre-construction period, including upkeep of fencing and landscaping.

“I would say that this contract actually holds the developer’s feet to the fire a bit more closely,” said Seth Merewitz, an attorney representing the city, who said the intention is to “strengthen accountability and transparency as the project goes towards construction.” The developer already started holding regular neighborhood meetings in November, according to Merewitz.

The amendment was informed by meetings between the hotel developer and city staff last year, including visits by city officials to the Dream Headquarters in New York, according to the city staff report.

The agreement now includes nine milestone dates instead of the original three, beginning with site investigative work and ending with the hotel’s opening. By March 31, the developer is required to have 80% of construction drawings completed — the earlier agreement had set a March 2024 date for that work. “These milestones provide clearer accountability than prior schedules and allow the City to monitor progress at defined intervals,” the staff report states.

Under the amended timeline, the target completion date is now Dec. 2028, pushed back from Dec. 2026.

The Orchid Tree Hotel project at 284 Baristo Road has been in the works for over a decade. In April 2025, the city entered a covenant agreement with the developer establishing a series of milestones the developer must meet.

The council on Wednesday heard an update on shifting some of those milestone dates. The initial deadline for the developer to submit a planning application was moved from Aug. 23, 2025, to Feb. 14 after city staff determined the initial submittal was incomplete. The original agreement included language “that gives the applicant opportunity to cure any default” in that application, with other timeline dates adjusted accordingly, according to Assistant City Manager Flinn Fagg.

City planning staff expect to issue a response letter to the developer by mid-March. Under the agreement, the developer has eight months after submitting an application to receive project entitlements, placing that milestone in mid-October.

All other milestone dates will “shift accordingly,” the staff report states. That pushes back the deadline for the start of construction from July 2027 to January 2028, and the certificate of occupancy from Dec. 2029 to June 2030.

The agenda item was a “receive and file” matter, meaning the council was not taking approval or denial action.

“Council has made it clear that each of these milestones are going to be part of the public discussion with the developer standing in front of us, defending why the delays occurred, whether we want to continue on with our partnership and perhaps revoke the hotel incentive agreement,” said Mayor Pro Tem David Ready.

“But that being said, we’re on a trajectory. So thank you for your efforts on this. So we look forward to seeing you then again, we will agendize this in an October timeframe, hopefully to celebrate the next milestone.”

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