The inaugural Association of National Olympic Committees (ANOC) World Beach Games is to be moved from San Diego after the Californian organisers were unable to raise the necessary money to fund the event.
ANOC has already opened discussions with at least two cities - believed to be located in Asia - to find a replacement so the event can go ahead this year as planned.
"The Games will take place in 2019 and ANOC is currently in discussion with a number of cities that have the financial guarantees necessary and a proven track record to host a world-class event," the organisation said in a three-paragraph statement tonight that pointedly did not mention San Diego by name.
"An announcement on the new host city will be made in due course."
The Games had been due to take place between October 10 and 15 and been preceded by the ANOC General Assembly, an event attended by all of the world's 206 NOCs.
This is now expected to be relocated along with the Games.
Competitors from more than 70 countries had already qualified to compete in 17 disciplines in 15 youth-centric beach, water and action sports on the iconic Mission Beach and other well-known San Diego locations such as South Mission Beach and Bonita Cove.
In total, more than 1,300 athletes were expected to take part in the Games.
But there had been doubts over San Diego's hosting of the event for several months with the Chef de Missions seminar having been postponed twice.
"We respect ANOC’s decision and will remain in communication with their team," San Diego 2019 chairman Vincent Mudd said in a statement on its website, according to the Times of San Diego.
"We greatly appreciate everyone’s work on diligently preparing our city for the Games.
"While it may not happen this year, San Diego will always be a wonderful location for major international events, and, the San Diego Exploratory Foundation will continue pursuing opportunities to host many more exciting activities in the future."
The website and Facebook and Twitter pages of San Diego 2019 were later suspended.
Asia would be a sensible place to relocate the event.
They have been holding Asian Beach Games since 2008 when the first one took place in Bali.
Subsequent editions have taken place in Muscat in Oman, Haiyang in China, Phuket in Thailand and Da Nang in Vietnam.
The next edition is due to be held next year in Sanya in China, with planning already well advanced.
China had been among the cities beaten by San Diego when the event was awarded by ANOC at its General Assembly in Washington D.C. in October 2015.
Other cities that bid included Sarasota in Florida, Dubai in the United Arab Emirates and Sochi in Russia.
The event, the brainchild of ANOC President Sheikh Ahmad Al-Fahad Al-Sabah, who had been the pioneer of the concept in Asia, was due to take place in 2017 with as many as 5,000 athletes competing in up to 22 sports, including esports.
They were later moved to 2019 in order to give NOCs and International Federations time to prepare athletes for the event and downsized to a much smaller version than originally planned.
The budget was also drastically cut from $135 million (£107 million/€121 million) to $39 million (£30 million/€34 million), a figure still beyond the organisers, even though they owned 100 per cent of the commercial rights.
The failure of the World Beach Games in San Diego follows the removal of another new event from California.
In March, the Global Association of International Sports Federations replaced Los Angeles as hosts of the inaugural World Urban Games and reallocated them to Budapest following a row over which sports should be included on the programme.