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Tuesday, Mar 19, 2024
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New Ambitions For Design District

Locally based RAF Pacifica Group has a million mixed-use development in the works at 330 S. Cedros Ave. in Solana Beach. Rendering courtesy of RAF Pacifica Group

The area of Solana Beach known as the Cedros Avenue Design District looks nothing like it did in the 1940s, when Quonset huts housed airplane parts from a manufacturing plant that operated there.

Today, there is a collection of upscale shops, galleries and offices in the popular design district that extends a little over two blocks along South Cedros Avenue, not far from the North County city’s beachfront.

And it appears there’s a new wave of renovations and construction planned for the district created 25 years ago.

Developers and other observers are expecting the projects to bring in new retailers and creative-office users, as well as the district’s first official residential units, as the neighborhood moves more in the direction of a work-live-play atmosphere.

“I’m seeing a lot of new redevelopment energy, activity and youth occurring there right now,” said Sean MacLeod, a longtime Solana Beach property owner who serves on the executive committee of the South Cedros Property Owners Association. The business improvement group was started around the time of the design district’s beginnings, in 1991-92.

Several months ago, MacLeod acquired a vacant parcel that had previously housed Cedros Gardens at 330 S. Cedros Ave., and subsequently invested considerable time and effort into completing entitlements.

$21M Mixed-Use Project

But after considering a wave of development changes hitting the San Diego region in the years since the Great Recession — and the high-demand, low-supply nature of retail projects in coastal areas — he decided to turn the property over to a developer with more experience in medium- and large-scale mixed-use development.

In mid-April, Encinitas-based RAF Pacifica Group announced that it had purchased that property for $5.5 million, with plans to develop a mixed-use, $21 million project to include high-end restaurants, ground-floor retail, offices and multifamily units. Tenants have not yet been announced for the 26,000-square-foot project, scheduled for completion in 2018.

“We’re going to take our time and get the right retail tenants in there,” said Adam Robinson, founder and principal of RAF Pacifica Group, in a recent interview. “The office space will probably have a waiting list.”

Robinson, whose company also has several office and industrial developments in the works in North County and central San Diego, said he and other developers have long been attracted to the design district, which draws visitors from throughout San Diego County, aided by its close proximity to a train station that brings in Coaster and Amtrak riders.

However, properties along South Cedros have several longtime local owners and have only come on the market occasionally over the years. Robinson said recent availabilities have given developers opportunities to provide visitors and locals with long-sought retail and dining elements, including outdoor patios and related sidewalk-adjacent amenities that fit the district’s character.

High Household Income Area

RAF Pacifica’s project news came less than two weeks after San Diego’s Brixton Capital announced the signing of upscale furnishings retailer West Elm, which plans to open just its second San Diego County store this fall at 212 S. Cedros Ave.

Brixton last year purchased the 1970s-vintage building, which originally housed a roller rink and later the Antique Mall, and the developer is at work on an extensive renovation that will also bring in other yet-unnamed tenants.

“We are very interested in coastal retail and office properties in San Diego County,” said Eric Li, vice president of leasing at Brixton Capital. That developer, for instance, earlier this year acquired the Del Mar Plaza retail center in downtown Del Mar, for an undisclosed price.

Del Mar and Solana Beach, with North County neighbors Rancho Santa Fe, Encinitas and Carlsbad, share demographics including large contingents of high-net-worth households. Brokerage firm CBRE Group Inc., which handled the West Elm leasing, noted that the average household income is more than $120,000 within a five-mile radius of the Cedros Design District.

However, property owners note that the 2.5-block district — which currently includes more than 85 boutiques, galleries and restaurants, along with offices — has long attracted a broad cross-section of visitors and locals.

Protective and Selective

Retaining several of the now-repurposed Quonset huts, the neighborhood is known for its Sunday farmers markets that draw visitors from throughout San Diego County, and the Belly Up is among the region’s best-known live-music venues, hosting a string of big-name acts over the years, most recently including a 2015 private performance by The Rolling Stones.

MacLeod acknowledged that change has come slowly for key hubs like the design district, because Solana Beach, like its coastal neighbors, is protective and selective when it comes to what gets developed. But he pointed to other projects along Cedros Avenue that, along with the RAF and Brixton ventures, are being carefully planned to preserve the district’s assets while boosting its practical utility.

For instance, at 507 South Cedros, owner Brian Church is in the process of turning an otherwise underused older building into offices for his architectural practice. At 444 South Cedros, owners Brian Caine and Jeremy Cohen are converting a vacated former plumbing business site into a mixed-use retail complex expected to include a coffee shop and other retail tenants.

And according to CoStar Group, Solana Beach-based Trilogy Investment Group, led by Michael Marks, purchased the building at 240 South Cedros Ave. in July 2016 for approximately $10.4 million. Trinity plans to retain the existing tenant, a marketplace known as Leaping Lotus, while expanding facilities to add high-end retail and creative office spaces, possibly to house technology-oriented businesses.

Residential Beginnings

MacLeod noted that RAF’s mixed-use project at 330 S. Cedros includes eight apartments on its second floor, which would be the first residential units formally proposed and developed specifically for the design district since its formation. Similar projects with small multifamily components — apartments or condos — could follow in coming years, provided they are compatible with surroundings and current zoning.

Current buildings along South Cedros consist primarily of ground-floor retail, with offices on the second floor. However, zoning in the district allows for the limited incorporation of residential elements in future mixed-use commercial projects.

“I think it could eventually become more of a live-work-play neighborhood,” MacLeod said of the design district.

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