California students are facing annual college costs of more than $50,000, even as the University of California system spends nearly $200 million on a luxury resort overlooking the Pacific Ocean.
UC Investments, the university system’s investment arm, acquired the Ritz-Carlton in Half Moon Bay for $193 million, according to Coastside News.
The 261-room oceanfront resort will become part of UC Investments’ more than $300 billion portfolio, which helps support retirement benefits and pensions for approximately 40,000 university retirees.
UC representatives declined to comment to the outlet.
The high-profile acquisition comes as the cost of attending several UC campuses has climbed beyond $50,000 a year for California residents. The purchase is likely to intensify debate over affordability at a public university system long associated with accessible higher education.
The transaction may also bring financial complications. The resort’s former owner reportedly had as much as $2.1 million in unpaid hotel occupancy taxes.
Unlike university-owned hotels that are generally used for conferences, retreats and academic events, the Half Moon Bay Ritz-Carlton is being acquired solely as an investment, a source told Coastside News.
The university may retain the Ritz-Carlton name and have the luxury brand’s management team continue operating the property, according to another source who owns several hotels.
The resort is also a significant force in Half Moon Bay’s economy. According to the report, it is the city’s largest employer and taxpayer.
UC chief investment officer Jagdeep Singh Bachher has previously indicated an interest in real estate investments, especially in the Bay Area and in affordable workforce housing, Coastside News reported.
The expansive oceanfront resort opened in 2001 with 261 rooms, a full-service spa, several restaurants and panoramic Pacific views.
At its debut, the property featured 93 fireplaces, six tennis courts and a 122-seat restaurant. Room rates were reportedly as high as $3,000 per night.
The resort has also drawn criticism because of its vulnerable coastal setting, including concerns over erosion and rising sea levels.
Residents opposed the resort’s development for decades. In 2019, the property received a $1.6 million fine for obstructing public access to a nearby beach.
The acquisition comes as the UC system faces increasing pressure over operating expenses, including rising pension and retiree-benefit costs.
Housing and food expenses have further increased the overall cost of attending college, leaving California families confronting six-figure bills for a four-year education at a public university.
When housing and other expenses are included, many in-state families will spend roughly $200,000 over four years, while out-of-state students can face costs exceeding $300,000.
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