CITY COUNCIL STAFF REPORT
DATE: March 11, 2026 BUSINESS & LEGISLATIVE
SUBJECT: AMENDMENT TO SETTLEMENT/DEVELOPMENT AGREEMENT BY
AND BETWEEN CITY OF PALM SPRINGS AND SELENE PALM
SPRINGS, LLC
FROM: Scott C. Stiles, City Manager
BY: Economic Development
SUMMARY:
This staff report provides the City Council with an update on the status of the Dream Hotel Project located at the northwest corner of Avenida Caballeros and East Amado Road, and requests Council consideration of the First Amendment to the Settlement and Development Agreement between the City of Palm Springs and Selene Palm Springs, LLC (“Developer”). The proposed amendment updates the project’s schedule of performance, memorializes additional community mitigation commitments, and clarifies ongoing site oversight obligations while preserving the City’s core economic development objectives and previously approved entitlements.
The Dream Hotel Project has a long history of City Council review and approval dating back as far as the late 1990’s, including multiple amendments to the Planned Development District, Purchase and Sale Agreement, Operations Covenant, and subsequent architectural and site plan approvals. Since the most recent City Council action approving amendments to the project in June 2023, the Developer has continued pre-construction work, site monitoring, and community coordination, while advancing design refinement, value engineering, and financing efforts.
The proposed Amendment reflects an updated and more detailed performance schedule extending through construction commencement and hotel opening, formalizes neighborhood communication protocols, and reinforces site maintenance and mitigation measures during the pre-construction period. Approval of the amendment will provide clarity and accountability regarding near-term milestones while maintaining the City’s protections and the overall framework previously approved by the City Council.
City Council Staff Report
March 11, 2026 -- Page 2
Amendment to Settlement/Development Agreement with Selene, Inc. 7 6
0 RECOMMENDATION:
1. Approve the First Amendment to the 2023 Dream Hotel Settlement and Development Agreement with Selene, Inc.; and,
2. Authorize the City Manager and City Attorney to make any non-substantive changes as needed and to execute the Amendment.
BACKGROUND:
The Dream Hotel Project has been subject to extensive City review and public process over nearly two decades, reflecting both its scale and its location adjacent to the Convention Center and established residential neighborhoods.
In July 2007, the City Council approved Planned Development District (PDD) 333 for the property, authorizing a mixed-use project consisting of a hotel and residential condominium development. Subsequent actions in 2009 and 2013 modified site layout, elevations, and phasing, while preserving the fundamental land use concept.
In March 2013, the City and the Developer entered into a Purchase and Sale Agreement and related Services Agreement governing conveyance of the City-owned property, performance milestones, and obligations related to public parking replacement.
Between 2014 and 2017, the City Council approved multiple amendments to these agreements adjusting entitlement deadlines, construction timing, and financing structure in response to market conditions and project redesign.
In June 2017, the City Council approved a significant amendment to PDD 333, transitioning the project to a Dream-branded hotel concept, including a 170-room hotel and 35 residential condominium units, with associated parking and amenities.
In November 2017, the Council approved an Amended and Restated Hotel Operations Covenant, extending the project’s participation in the City’s Hotel Operations Incentive Program and revising performance benchmarks.
Between 2018 and 2019, the City approved further amendments to the Purchase and Sale Agreement and Final Development Plans, including adjustments to the hotel-to- condominium unit mix, relocation of residential buildings, and extensions to construction and opening milestones. These actions preserved the project’s eligibility for incentive participation while responding to evolving design, financing, and construction realities.
In June 2023, following continued public hearings and Planning Commission review, the City Council approved amendments to the Final Development Plans and Tentative Tract Map, together with a Settlement and Development Agreement intended to facilitate completion of the project. As part of that action, the Council directed additional City Council Staff Report
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0 architectural review of the North and South Villas and requested heightened attention to neighborhood interface, site security, and project timing.
In 2024, the Architectural Review Committee conducted multiple hearings on the residential components of the project, resulting in further refinements to building massing, materials, solar control, and perimeter treatments. These reviews did not alter the overall entitlements but ensured consistency with Council direction and neighborhood compatibility.
Following the 2024 approvals and subsequent architectural reviews, the Developer has continued pre-construction activities while coordinating closely with City staff. These efforts focused on maintenance of the site including landscape and fence conditions, completed $80M in value engineering, secured administerial entitlements, refined construction sequencing, and advanced financing discussions.
The Developer has also undertaken steps to improve transparency and responsiveness to community concerns, including preparing materials for neighborhood meetings, developing a project webpage framework, and coordinating with staff regarding site maintenance and security issues raised by nearby residents. Neighborhood meetings are held the second Thursday of every month at the Palm Springs Convention Center and can be found here: www.PalmSpringsDream.com
Staff notes that while construction has not yet commenced, the proposed First Amendment reflects a more robust and structured approach to project oversight, communication, and milestone tracking than prior agreements. Approval of the amendment will allow the City to formalize these commitments and provide a clearer basis for ongoing monitoring as the project moves toward construction.
STAFF ANALYSIS:
Proposed First Amendment – Key Terms
The proposed First Amendment to the Settlement and Development Agreement is informed by 2025 activity including recent project status reviews, visits by City officials to the Dream Headquarters and ownership in New York, correspondence between the City and Developer in 2025, and discussions focused on addressing schedule compliance, site conditions, and community concerns. The amendment is narrowly tailored to update performance milestones and formalize commitments that have been the subject of ongoing coordination.
Updated Schedule of Performance The amendment establishes a revised and detailed schedule extending from late 2025 through hotel opening, including interim benchmarks for construction document completion, site remediation, financing completion, construction commencement, and project delivery. These milestones provide clearer City Council Staff Report
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0 accountability than prior schedules and allow the City to monitor progress at defined intervals. This schedule extends the terms of the Covenant.
Community Outreach and Communication Commitments The amendment significantly strengthens and formalizes the Developer’s obligations related to community engagement. Specifically, the Developer commits to:
- Hosting an initial neighborhood meeting beginning in November 2025, followed by monthly in-person meetings thereafter through project completion, at the Developer’s sole expense;
- Establishing and maintaining a dedicated project webpage and project email address, updated at least monthly with schedule updates, construction notices, and upcoming meeting information;
- Providing opportunities for residents to sign up for project updates and notifications;
- Coordinating with City staff on meeting logistics, agendas, and follow-up responses to community questions; and
- Continuing good-faith cooperation with the City to implement additional mitigation measures as may be mutually agreed upon prior to and during construction.
These commitments are intended to ensure consistent, transparent communication with nearby residents and stakeholders and to provide predictable forums for addressing issues as the project advances.
Ongoing Site Oversight and Maintenance The amendment also memorializes the Developer’s obligation to maintain the site during the pre-construction period, including regular monitoring, fence repairs, landscape maintenance, and timely response to site conditions upon awareness. These measures respond directly to prior Council concerns regarding aesthetics, security, and neighborhood impacts while construction is pending.
ALIGNMENT WITH STRATEGIC PLANNING:
This action directly advances the City Council-adopted Economic Development Strategic Framework, Principle B (Reinvigorate the Business Climate); Principle C (Bolster Core Industries); and Principle E (Strengthen Community Assets and Infrastructure).
FISCAL IMPACT:
Approval of the proposed First Amendment has no immediate General Fund impact. The amendment does not increase the City’s financial obligations or modify the previously approved Hotel Operations Incentive Program terms. Upon completion and operation, the project is anticipated to generate significant ongoing TOT, sales tax, and property tax revenues consistent with prior analyses presented to the City Council.
City Council Staff Report
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0 REVIEWED BY:
Department Director: Wayne Olson
City Attorney: Jeffrey S. Ballinger
City Manager: Scott Stiles
ATTACHMENTS:
A. 2023 Draft Agreement with Selene Palm Springs, LLC approved on June 5, 2023 B. Dream Hotel First Amendment to the Settlement and Development Agreement by and between the City of Palm Springs and Selene Palm Springs, LLC C. Covenant Agreement and between the City of Palm Springs and Selene Palm Springs, LLC