CEDARst Companies, based in Chicago, is starting construction on a $74 million apartment building in North Park in the company’s first San Diego project – with more in the works.
“CEDARst as a whole was ready to grow beyond Chicago, which is historically where we focused our energy,” said Will Murphy, the company’s CEO and managing partner.
“We were always attracted to the West Coast. Obviously, there’s a housing crisis in California and San Diego is no different,” Murphy said. “San Diego, from our perspective at CEDARst, has some of the best fundamentals for multi-family development. We think it has a great quality of life.”
CEDARst’s equity partner in the project is Bridge Investment Group. JLL secured a $45.5 million construction loan for the project from BMO Harris Bank.
CEDARst and Bridge Investment also are partners in developing a 226-unit project, TimberHouse, in Vancouver, WA.
“We were really attracted to North Park. It’s in line with the demographic that we cater to in Chicago and the upper Midwest,” Murphy said. “Our demographic is predominated by millennials and Gen Z-ers. We’re in that age bracket, call it 20 to 35.”
Biking Community
The North Park site at 4135 Park Blvd. was particularly attractive because it is within an Opportunity Zone, a designation that comes with tax advantages, Murphy said.
Due to be completed in 2024, the seven-story project under way at 4135 Park Blvd. will have 190 apartments in a mix of studio apartments, one-bedroom apartments and two-bedroom apartments.
The apartments will range from about 420 square feet to about 770 square feet.
Monthly rents will range roughly from $1,100 to $1,400 for studio apartments, and roughly $2,000 to $2,900 for two-bedroom apartments, Murphy said.
The project will have 11 apartments designated as affordable for renters with annual incomes up to 50% of the area median income.
Community amenities will include a two-story fitness center, a game room, a café, a swimming pool, hot tub and communal kitchen.
Apartment balconies will be big enough to serve as an extension of interior, Murphy said.
The project is considered a transit oriented development and although zoning regulations don’t require it, Murphy said it will have from 150 to 165 parking spaces.
“It’s just something we believe in,” Murphy said.
To encourage people to get out of their cars, the project also will have “significant bike storage.”
“We see San Diego as a biking community. Even here is Chicago, despite six months of freezing temperatures, we still make a concerted effort to offer bike storage for our tenants,” Murphy said.
More Planned
According to Yardi Matrix, a real estate research firm, the San Diego multi-family market rebounded in 2021.
Doug Ressler, manager of business intelligence at Yardi, said that the rebound was “sustained by strong demand paired with limited inventory expansion.”
“Meanwhile, occupancy increased to 97.8% as of November, up 1.5% year-over-year, signaling one of the tightest rental markets in the country,” Ressler wrote in an email.
Murphy said CEDARst is planning another apartment project in North Park and is looking at other sites in North Park, South Park, East Village and the Gaslamp Quarter.
“We’ve been focused on those markets,” Murphy said, adding that “candidly, we’re looking at every market in San Diego right now. It’s an area of focus for us and our capital partner.”
He said the company is drawn to neighborhoods that have a high walkability score.
Murphy declined to give details on the second North Park project that CEDARst is planning but said it will be similar to the one at 4135 Park “in terms of size and scale.”
“We’re excited to be part of the community and we hope to be opening an office on the West Coast soon,” adding that the office would likely be in San Diego, “another indication of our commitment to San Diego.”
CEDARst Companies
Founded: 2008
Headquarters: Chicago
CEO and Managing Partner: Will Murphy
Business: Housing development, management and general contracting
Employees: 150
Website: www.cedarst.com
Contact: info@cedarst.com; 312-506-3200
Notable: The company’s national portfolio includes about $2 billion in assets in seven states.
