Cayucos News: County Reviews Two-Story Mixed-Use Motel Proposal on South Ocean Avenue

CAYUCOS NEWS | LOCAL DEVELOPMENT AND INFRASTRUCTURE · OCTOBER 2026

San Luis Obispo County filed an August 13, 2026 environmental exemption notice concerning a new mixed-use motel proposed at 17 South Ocean Avenue in Cayucos. The application seeks a major grading permit for a two-story building in the community’s coastal-zone commercial area.

What the documents actually say

The state notice describes an approximately 4,910-square-foot building planned on a 0.18-acre parcel, with roughly 290 cubic yards of earthwork. The development would disturb most or all of the small lot during grading and construction. The parcel is currently identified in the Commercial Retail land-use category and lies in the Estero Planning Area. The public record says the applicant designed the grading and site improvements to minimize disturbance within the available footprint.

Why it matters locally

For a small coastal community, a new lodging project may affect parking, traffic, construction activity and the character of nearby commercial streets. The environmental notice does not specify the number of motel rooms, opening date, tenant lineup or final operating approvals, so those details should not be assumed. Residents can request the submitted site drawings and permit conditions from county planning staff.

What happens next

Cayucos News will report separately on any subsequent building permit, approved project modifications, construction timeline and confirmed public opening. The August notice records environmental review of a grading proposal, not an operating hotel.

Official source

San Luis Obispo County — Donaldson Grading Permit, August 13, 2026.

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