San Diego Business Journal Development: Formation Of Sanitation District a Step Toward Future Growth

Just to the east of the San Diego city limit in Otay Mesa sits between 3,300 and 3,900 acres of flat, vacant land its many owners would like to see become an extension of the busy industrial development within the nearby city limits.

However, that must wait until infrastructure to support development is built, said one county official. One step in that direction was the recent formation by the county Board of Supervisors of the East Otay Mesa Sanitation District, said Joan Vokac, the county's chief of advanced planning.

Earlier this year, the county formed the district so funds could be assessed via property tax that will pay for sewers in the area.

The land is east of Brown Field and south of the George F. Bailey Detention Facility. Enrico Fermi, Airway and Otay Mesa roads make up the south and east boundaries, she said.

"The Board of Supervisors has also authorized formation of an infrastructure financing district to capture the tax increase from the development that goes in," Vokac said. "We're also hoping to get light rail in along SR 125. We have the last area in the county that's nice and flat."

Steep Slopes

The current zoning calls for residential development in some parcels that have a greater than 15 percent slope. However, because of the slope the land will likely be rezoned as open space, she said.

While most of the land is unused, there are plans to build a truck stop and hotel currently going through the county approval process, Vokac said. There's also a power plant project by Pacific Gas & Electric Co. that will be built on East Otay Mesa if the state energy commission approves it, she said. The county has already given its approval.

Despite the current activity in the east mesa area, full-scale development is likely to still be five to 10 years off, a real estate agent active in the area said.

"The big problem is infrastructure , you need sewers, roads and fire hydrants , and until you get them, things won't start moving," said Brian Olivier, associate vice president of San Diego Commercial Real Estate Services.

"We could get a third border crossing, which would really open things up, by maybe 2003," Olivier said. "However, it will likely be 2007 to 2010 before the crossing is finished."

He currently represents Swallows Holdings LTD of Tijuana, which owns 160 acres zoned for mixed industrial and commercial support uses in the east mesa area.

Educated Workers

"In addition to infrastructure, you also need to have people who are highly educated living nearby," Olivier said. " It's a much easier commute to Otay Mesa than it is to Carlsbad if you live south of San Diego, so we're hoping people will see the benefit of working here if they live in the South Bay area."

Housing for those highly educated workers is starting to be built on Otay Mesa. In November, McMillin Homes of National City announced plans to build the first two neighborhoods at Vista Pacifica, a 204-acre parcel on Otay Mesa. The two neighborhoods will have 242 new homes when completed, said Sandy Perlatti, senior vice president.

Residential developers are still active in the area just to the north of Otay Mesa. Carlsbad-based Shea Homes San Diego has two neighborhoods at Otay Ranch where it is currently selling new houses as well.