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Thursday, Oct 6, 2022
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Echo Boom

Completed (10 Projects)

A summary of downtown projects completed in 2015 (mixed-use projects are counted separately by type):

• 1,248 apartment units (6 projects)

• 90 hotel rooms (1 project)

• 57,000 square feet of public park space (1 project)

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• 40,000 square feet of retail space (6 projects)

• 36,000 square feet of education space (1 project)

• 28,000 square feet of office space (1 project)

Approved Pending Construction (32 Projects)

A summary of downtown projects approved but not yet underway (mixed-use projects are counted separately by type):

• 4,382 apartment units (17 projects)

• 853 condo units (3 projects)

• 2,465 hotel rooms (6 projects)

• 377,000 square feet of retail space (22 projects)

• 1.315 million square feet of office space (2 projects)

From Little Italy to East Village, downtown San Diego continues to witness a steady post-recession stream of new building projects, especially apartments geared to the rising tide of millennial-age residents – 35 and younger – who prefer to live and work in vibrant urban spaces.

Downtown’s current residential population, which also includes empty-nest baby boomers and other 40-and-over business professionals – is at 40,000 and expected to reach 90,000 in the next 20 years. Those new residents will also demand quality-of-life elements like parks, stores, hotels and restaurants – also in the pipeline – that experts say will transform the environment to where it resembles the urban hubs of other major U.S. cities, such as New York and San Francisco.

The upshot could be a downtown operating in 24-7 mode, rather than the weekday “18-hour” cycle long familiar to local residents in many parts of downtown, especially the central office corridor.

“You need to be adding these amenities that people expect when you are living in a higher-density environment,” said Brad Richter, assistant vice president of planning for Civic San Diego, the city’s downtown project oversight agency.

At the end of 2015, Civic San Diego data showed that downtown had 17 projects currently under construction, which will eventually add 2,365 apartments and 232 for-sale condominiums to the local inventory.

Also at year’s end, construction cranes were in motion at downtown projects that will eventually bring 1,081 new hotel rooms to the market, along with 141,000 square feet of retail and more than 750,000 square feet of other commercial space.

Factor in another 32 projects that have been approved but not started, and another 15 projects submitted but pending approval, and downtown’s seven neighborhoods over the next decade will have more than 10,000 new apartments and condos than exist today, along with 13,000 additional hotel rooms and nearly 2.7 million square feet of commercial space.

The past year saw the completion and opening of downtown’s tallest apartment property, Pinnacle International’s 484-unit Pinnacle on the Park in East Village, the first of two 45-story towers planned for that site.

On downtown’s western end, Bosa Development is at work on a 41-story, 232-unit luxury condominium development called Pacific Gate, which has its own twin planned for a nearby parcel.

Later this year, downtown is expected to see the completion of the new $555 million county courthouse at State and C streets, among the biggest local construction projects of the past five years.

At the former Lane Field ballpark site, a development partnership known as L2HP is nearing completion on a dual-branded Marriott hotel project with a total of 400 rooms; and a summer opening is expected for T2 Hospitality’s new dual-branded Hilton project, with 364 rooms, near Little Italy.

The ever-bustling Little Italy continues to get an array of new apartments and restaurants, with more new elements including a central public plaza now under construction. Near downtown’s central business hub, a new public-square park with an amphitheater will be opening in May next-door to Westfield Horton Plaza, and the city has several other new downtown parks in the pipeline, including a multi-block open space called East Village Green.

Shaping all of this into a livable, walkable and drivable environment will be the challenge of government leaders as well as the developers aiming to capitalize on shifting demographics and lifestyle trends. Where those 35-and-under new workers prefer to work and play will continue to influence what gets built and how it all fits together over the next several years.

The city is in the process of getting public comments on a downtown mobility plan, part of which includes new way-finding signs that recently hit the streets of downtown to help residents and visitors better navigate the landscape and cut down on fuel-wasting searching for their destinations.

The city in the past year has been adding shared-bike and shared-car amenities in the downtown area, and later this year will significantly expand a downtown circulator service, making use of energy-efficient small vehicles that can be hailed on mobile apps to take multiple riders to all of downtown’s neighborhoods.

Economist Alan Nevin, director of economic and market research at San Diego-based Xpera Group, said the demographic trends shaping today’s downtown developments will be influencing developer offerings for the next several years.

One trend is that an estimated two-thirds of current downtown residents live alone. Nevin said many of those are younger professionals – working primarily in law and financial services – who have recently moved out of their parents’ homes or gotten out of situations where they lived with roommates.

That suggests a continuing rising demand for apartments, and Nevin said the impact of millennial professionals “has been huge” in that regard. For instance, he said owners at four downtown apartment buildings that opened during past 18 months – representing a total of about 900 units priced on average at $3 per square foot – reported that they are now nearly fully leased. Leasing has also been brisk at the new Pinnacle tower in East Village, Nevin said.

While apartments are obviously in demand, downtown will eventually need to address a relative dearth of affordable new for-sale homes. Entry-level for-sale housing will be essential to keep those younger new residents downtown, especially if they decide to raise families there.

“I wish that somebody would build a moderately priced condo project,” Nevin said. “Right now, nobody’s taking on projects with units priced between $300,000 and $500,000.”

In the central business district, the millennials could do even more to change the complexion of downtown, especially if the neighborhood continues to get more technology-oriented companies whose workers get out into the neighborhood to socialize and spend money at neighboring businesses during and after the work day. “The boomer workers generally don’t leave the building,” Nevin said.

Among wild cards going forward for the downtown development mix is what becomes of the San Diego Chargers’ quest to build a proposed multi-purpose stadium and events facility, likely in the southeastern corner of East Village.

Voters will ultimately decide whether a Chargers stadium happens downtown, possibly at the ballot box in November. But the prospect of an East Village stadium already has local urban planners buzzing with concern, including leading advocates of a mixed-use area in early stages of development in the northern part of the neighborhood, known as the IDEA District.

The district has long been envisioned as a hub for innovation, design, education and the arts. Two separate mixed-use projects under different developers – Makers Quarter and IDEA1 – are currently in progress with planned elements including apartments, offices, stores and restaurants.

Local architects, designers and other urban advocates recently held the first in what is expected to be a series of workshops addressing the future of East Village. About 10 years ago, said IDEA1 developer and longtime IDEA district planner David Malmuth, city leaders envisioned that the southern part of East Village – now being eyed for a stadium – would house a job-creating hub for major corporate or educational users requiring large floor plates.

The stadium issue ultimately will play a big role in future planning for East Village, downtown’s largest neighborhood, spanning 1,300 blocks. “There’s nothing wrong with competing proposals,” Malmuth said. “It forces the issue, and it creates urgency.”

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