Morro Bay releases final report on former elementary school site

By Staff Report · Thu Aug 27 2026

The City of Morro Bay has released its final due diligence report for the former Morro Elementary School property as the city moves closer to deciding whether to complete its purchase of the 9.7-acre site.

The city is under contract to purchase the property at 1130 and 1330 Napa Ave. from the San Luis Coastal Unified School District for $5.3 million. The City Council approved the purchase agreement in March.

The property includes the former school’s main building and other campus structures. The city is evaluating the site primarily for potential use as a new City Hall, while portions of the property could eventually be considered for housing and open space.

The city’s due diligence process has included environmental testing, architectural and structural evaluations, assessments of mechanical, electrical and plumbing systems, historic resource reviews, title and boundary work, and preliminary construction cost estimates.

The city said the final report compiles findings from the various consultant studies and will help inform the City Council’s determination of whether the property is suitable for its intended uses. The council is expected to consider that determination in late August.

The purchase agreement includes a $500,000 earnest money deposit, which would be applied toward the purchase price at closing. The due diligence period ends Aug. 31, with closing anticipated on or before Oct. 31. The property is being purchased in “as-is” condition.

If the city identifies unacceptable risks or unexpected costs during the due diligence period, the agreement allows it to terminate the purchase before the deadline and receive a refund of the deposit.

The city has also held community meetings in April and June and is offering additional opportunities for residents to tour the former school property. Upcoming tours are scheduled for Sept. 23 at 5:30 p.m., and Oct. 14 at 5:30 p.m. No registration is required.

The final due diligence report and other project documents are available at morrobayca.gov