Downtown San Marcos bed-and-breakfast property for sale

The owners of the buildings at 326 W. Hopkins St., San Marcos, which includes the Crystal River Inn and the Thomas House, have put the property for sale.

The owners of the buildings at 326 W. Hopkins St., San Marcos, which includes the Crystal River Inn and the Thomas House, have put the property for sale.

The Crystal River Inn, 326 W. Hopkins St., San Marcos, is for sale.

Co-owners Cathy and Mike Dillon said that is not news. The property has “essentially been for sale for about three years,” Cathy said.

The owners did recently change the listing agent on the property to the Damron Group Realtors, a San Marcos-based realty company. The list price on the property, which includes four buildings and approximately 37,927 square feet, is $3 million.

The Dillons have been at the forefront of a number of zoning issues in downtown San Marcos that they and some city residents believe could disrupt the neighborhood's character.

Most recently, the owners of the Crystal River Inn successfully led an appeal of a planning and zoning commission decision to grant an alcohol sales permit to Gumby’s, a pizza restaurant, on Feb. 7. That appeal was granted by City Council on Feb. 7, which meant Gumby's will no longer be allowed to serve mixed drinks. Patrons at the new restaurant, located at 312 W. Hopkins St., will still be able to bring their own beer and wine to the restaurant.

The Dillons said they are concerned more bars—Gumby’s owner Forrest Higdon has said his business's new location near Crystal River Inn would be a restaurant first and a bar second—could disrupt the character of the 300 block of Hopkins Street. That could potentially make it difficult to keep their B&B in business, which they hope the next property owner will be committed to doing.

“[The property being on the market] is essentially irrelevant to Gumby’s, with the exception of the fact that our fondest wish after 33 years of running this business is that we are so eager to have this hotel stand on its own in the future as a hotel,” Cathy said. “We would like to see it as a hotel, keep it as a boutique hotel. San Marcos needs such a place downtown. It doesn’t need more student housing."

The Dillons were also involved in a lengthy fight with Zelick’s, a bar adjacent to their property, in 2012. The Dillons have said Zelick's caused disruption to their business because of noise and other issues stemming from the bar.

Mike said although the relationship between Zelick’s owners and the Dillons has improved in recent years, they would not have supported the bar owners’ initial bid to build their business in that location “had we known what we know now.”

“We want to keep the neighborhoods in the neighborhoods,” he said. “We want to keep the bars and businesses downtown. And we need a transition between the two.”