Why Fairmont can’t bar homeless — or anyone else — from its San Jose hotel

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When San Jose subsidized development of the downtown Fairmont Hotel, the money came with an unusual catch: The luxury high-rise in the heart of Silicon Valley couldn’t stop anyone from visiting the lobby, restaurants and ground-floor public restrooms.

Even the homeless.

But Pascual Mendivil, who spends his nights on a nearby sidewalk a world away from 1,000-thread count sheets, says the hotel hasn’t always honored the deal: Twice last year, he says, the Fairmont told him to leave when he went to use the restroom and lobby.

“The first time, I just asked to use the telephone,” said Mendivil, 67. “They asked if I was a guest and then told me to get out. Another time I went to use the restroom and a guy in a suit with a walkie talkie told me to get out, he told me I couldn’t use the facilities if I wasn’t a guest.”

Mendivil obliged. But he remembered reading in the newspaper about a city pact that ensured he was just as welcome in the Fairmont lobby as the rich and famous who visit Silicon Valley. So he went to City Hall and rode the elevator to the 16th floor to visit City Attorney Rick Doyle’s office to find out. Sure enough, he walked away with a copy of the terms that confirmed it.

“They signed on to something and they have to meet their obligations,” Mendivil said.

Fairmont General Manager Dan McGowan didn’t directly address Mendivil’s claims that he was twice asked to leave the hotel. But he insisted in a written statement that the hotel aims to abide by the terms of its covenant with the city. Indeed, the Fairmont often serves as a pit stop for crowds during concerts and events across the street at Plaza de Cesar Chavez.

“Fairmont San Jose has been a proud pillar of the downtown community for more than 30 years,” McGowan said. “Our hotel has a covenant with the city to allow public access on our ground floor, and we are proud to honor this agreement. We work hard to ensure our hotel remains a place where both locals and guests can feel welcome, safe and secure.”

It would not be the first time owners of the hotel, which changed hands in January 2018, were accused of failing to abide by the unique access requirement. In 1996, the city attorney’s office noted that signs near the hotel’s entrance that said “the facilities of this hotel are for the exclusive use of guests and patrons of this hotel” violated the agreement.

“A failure to allow public access is a default under the Declaration of Covenants, Conditions and Restrictions,” the city attorney’s office told city officials in a Dec. 4, 1996, memorandum. It added that “it seems apparent that some contact needs to be made with the Hotel owners to remind them of the public’s rights at the Hotel.”

The Fairmont, whose 22-story tower opened in 1987 between South Market and South First streets, was a key component in a decades-long quest by San Jose city and business leaders to revitalize a downtown that suffered from retail flight to suburban malls.

The hotel was originally built for $140 million by San Francisco’s Swig family and local developer Kimball Small, with the city’s redevelopment agency kicking in $28.2 million, a subsidy that former director Harry Mavrogenes said was critical to making it happen.

In 1996, a partnership led by veteran Bay Area developer and former Oakland Athletics baseball team owner Lewis Wolff bought the hotel for $36.7 million and, with a $9.5 million city contribution, spent $80 million building the hotel’s 13-story annex, which opened in 2002.

Wolff’s partnership sold the Fairmont in January 2018 for more than $223 million to SJ SC Holdings, a group controlled by San Ramon-based Eagle Canyon Capital, whose primary executive is Sam Hirbod.

But City Attorney Rick Doyle said the public access requirement — he’s unaware of another like it — remains part of the deal. The covenant allows hotel officials to establish “reasonable rules and regulations” concerning public access to ground-floor amenities, which Doyle said could allow them to prohibit “spending hours on end” in the restrooms or “showering in the sink.”

“But short of that,” Doyle said, “they have to abide by the covenant. In the past, we’ve had to remind the Fairmont.”

Mendivil said he’s a longtime San Jose resident who has also lived in Phoenix and the Merced County town of Los Banos to be near family.

He hasn’t been back to the hotel since and doesn’t plan to press the issue — he said he doesn’t want to cause trouble. He hasn’t talked to a lawyer — can’t afford one, he said — or raised the issue with city leaders. But he still hopes City Hall will hold the hotel to its promises.

“I think they have to be kept honest,” Mendivil said recently. “There are other people who want to use the facilities. They took our public money and they owe us something.”

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