Commercial Real Estate in Half Moon Bay: Main Street, Visitor-Serving Zoning and Coastal Permits

By Matthew Martinez, Founder, CEO & Managing Broker, Diamond Real Estate Group. California DRE #01869679.

Half Moon Bay is the only incorporated city on the San Mateo County coast, and its commercial property falls into three groups: the historic downtown along Main Street, visitor-serving lodging and recreation sites near the shoreline, and general commercial and industrial land along the Highway 1 and 92 corridors. Every parcel in the city lies inside the Coastal Zone, so commercial projects go through the city’s Local Coastal Program as well as its zoning. Confirm zoning and permit needs with the City of Half Moon Bay before relying on this page.

Who controls the parcel

Half Moon Bay regulates land use inside city limits through Title 18, which carries the city’s certified Local Coastal Program zoning. Under Chapter 18.20, all land and water within the city is in the Coastal Zone, and development generally needs a coastal development permit (CDP) before work starts. Neighboring El Granada, Princeton and Miramar to the north are unincorporated and follow County rules; see our El Granada commercial guide.

The California Coastal Commission keeps a direct role in some cases. It issues permits for development below mean high tide or on tidelands and public trust lands, and city decisions on certain sites can be appealed to it, including land between the sea and the first public road and sites within 300 feet of a beach or the top of a coastal bluff.

Half Moon Bay zoning for commercial, industrial and mixed use

In all of these districts, a use the code does not list is prohibited.

Main Street and the C-D downtown district

The C-D district implements the downtown specific plan.

• By right. Restaurants, indoor retail and offices outside Heritage Main Street.
• Use permit. Bars and some auto uses.
• Heritage Main Street. This subarea covers Main Street between Pilarcitos Creek and Correas Street. Extra ground-floor rules apply to the first 50 feet of frontage depth, and multifamily housing is not allowed in that ground-floor space.

Housing downtown. Single-family and multifamily housing is allowed elsewhere in C-D without a permit. In mixed-use projects, homes generally go upstairs, though the Planning Commission may consider some ground-floor units.

Form and parking.

• Height and coverage. Buildings may reach 36 feet and three stories, with no coverage cap for commercial, mixed-use or multifamily buildings.
• Setbacks. None, except five feet from adjoining residential parcels.
• Parking. Mixed-use projects can get a shared-parking reduction of up to 20%, guest parking can be waived on Heritage Main Street, and off-site parking within 300 feet is encouraged.

The chapter dates from the 1996 zoning code, most recently amended by Ordinance C-2023-02.

Visitor-serving and general commercial land

C-VS. The C-VS district, whose purpose statement was added by Ordinance C-2020-02, is for recreational commercial areas serving coastal visitors, with uses expected to fit the recreational setting.

• Allowed. Hotels, motels and time shares, capped at 36 bedrooms per net acre, and B&Bs.
• Use permit. Restaurants, fast food, bars, campgrounds and RV parks, and vehicle repair.
• Not allowed. Service stations, car washes and auto rental. Multifamily housing is also barred, and any residential space in a mixed-use project needs a use permit and must be secondary.

C-G. C-G permits restaurants, drive-throughs, service stations, auto rental and vehicle repair, and it allows multifamily and mixed use. Hotels and B&Bs are allowed in both districts.

Shared standards. Both districts cap height at 36 feet and three stories and require 10,000-square-foot lots. Front setbacks are 20 feet in C-VS and 25 feet in C-G, with 15% and 10% landscaping respectively. Neither sets a coverage percentage for commercial buildings; parking effectively sets the buildable area.

Coastal permits and the growth limit

What needs a CDP. Under Chapter 18.20, CDPs are required for development as the code defines it. Examples include work within 100 feet of sensitive habitat, riparian corridors, bluffs or wetlands, new wells or septic systems, removal of major vegetation and some temporary events. Business licenses, sign permits, home occupation permits, repair and maintenance, and some seasonal sales are exempt.

Who decides. The Planning Commission or City Council decides most CDPs, and the Community Development Director handles minor ones. To approve a CDP, the city must find that the project conforms to the LCP, has adequate services, and is consistent with the city’s annual population limitation system.

The growth limit. Chapter 18.04 caps new dwelling units each year at the number that would produce 1% population growth, with a 50% increase allowed for the downtown area. The city’s allocation system says it carries out Measure D, the residential growth initiative. This affects any commercial project with housing, and the CDP consistency finding brings it into commercial review. One-for-one replacement units and state-required affordable density bonuses are exempt.

Transfer tax, business tax and property tax

The San Mateo County Assessor-County Clerk-Recorder collects documentary transfer tax at 55 cents per $500, or $1.10 per $1,000, at recording. The County page names only the City of San Mateo as adding a city tax; we did not find a Half Moon Bay transfer tax, but confirm on the escrow estimate. Half Moon Bay has a transient occupancy tax chapter (3.12); we did not confirm its rate or the business license tax. A sale generally triggers Proposition 13 reassessment.

Due diligence that matters in Half Moon Bay

Start with our commercial due diligence checklist, then add:

• Confirm the parcel is inside city limits and not in unincorporated Miramar or El Granada.
• Check whether the site is in a Coastal Commission appeal area (near the beach, bluffs, wetlands or streams).
• On Main Street, confirm whether the parcel is in Heritage Main Street and how its ground floor is used.
• For lodging in C-VS, check the 36-bedroom-per-acre limit.
• For any housing component, confirm the growth-limit allocation path.
• Confirm water and sewer service capacity for new or intensified uses.

Questions people ask

Sources & notes

1. Half Moon Bay Title 18, Zoning (GoCodebook)
2. Chapter 18.07, C-D and C-R
3. Chapter 18.08, C-VS and C-G
4. Chapter 18.20, Local Coastal Development Permits
5. Chapter 18.04, Residential Growth Limitations and Chapter 17.06, Residential Dwelling Unit Allocation System
6. San Mateo County Assessor-County Clerk-Recorder, documentary transfer tax

Note: We did not review the downtown specific plan, the IND and PUD chapters, the zoning map or the hotel tax and business license chapters. The growth limit is described from the code; we did not review the Measure D ballot text itself.

This page is general information, not legal or tax advice. Last reviewed October 2026 by Matthew Martinez.

Related: Half Moon Bay real estate guide · Multifamily property in Half Moon Bay · Commercial real estate services