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Wednesday, Jun 19, 2024
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Seaport Village Breathes New Economic Life

RETAIL: Center Now 97% Leased, New Restaurants Opening Soon

After a few years of pandemic-related malaise, Seaport Village is once again a booming center of economic activity.

Rafael Castellanos
Commissioner
Port of San Diego

“The Port of San Diego has invested a lot of time, money and effort in Seaport Village, and it’s really paying off with several new stores and restaurants – and more coming soon,” said Port of San Diego Board Chairman Rafael Castellanos.

At least two businesses with brick-and-mortar locations already on site have expanded their reach this summer. Mike Hess Brewery recently extended its Seaport Village footprint with a second location while LG Retail Enterprises’ President and CEO Chris Glenn opened his company’s fifth shop in the 14-acre center.

San Diego favorites Crack Taco Shop and Zytoun Gourmet Mediterranean are set to open before the end of the year. And established restaurants from points north have also come on board.

Helene Henderson
Co-founder
Malibu Farm

Los Angeles-based restaurant Malibu Farm, which has six locations including one in New York and another in Japan, is expected to open this month at Seaport Village. Co-founders John Stockwell and his wife, Helene Henderson in 2019 toured the 14,000-square foot digs that were long the home of now shuttered Harbor House.

“We drove down to check it out and fell in love,” Henderson said. “San Diego was a huge investment for us. We are still an independently owned ‘mom and pop’ operation and do not have the funds of a corporate and/or investor-owned restaurant group. We hope we will be embraced by the community and the locals… We love Seaport Village and the quirky historical charm of it.”

Shorebird, a coastal-inspired concept by Wild Thyme Restaurant Group out of Newport Beach, is also expected to open this year, while seafood restaurant Gladstone’s out of Malibu and Cork & Batter, a sports bar out of Inglewood, anticipate 2024 openings.

An Easy Sell

Since 2018, the Port has worked in close coordination with property manager Protea Property Management, Inc., as well as broker Retail Insite, the company hired to manage its leases.

Allison Campbell
Partner
Retail Insite

Retail Insite Retail Partner Allison Campbell said selling Seaport Village to potential tenants has not been tough.

“From the start, we strategized with the port on ‘How can we kind of really make this project dynamic and bring in great tenants?’” Campbell said.

She said one of the keys was to allow for longer term leases and guarantees for tenants the right to operate for five years, with the Port given the rights to terminate leases after that time.

“You know there’s not one-size-fits-all but that was a pretty great way to structure a deal that let those businesses open and invest in their space, to get the sales that they need, while still allowing the Port to maintain control of their real estate while they’re moving forward and working toward the long-term development,” she said.

Foot Traffic, Revenue Returning

In 2018, Seaport Village was challenged with 20 of its 68 storefronts vacant. Currently, Seaport Village is 97% occupied with 63 tenants and only five vacancies, according to Port of San Diego Public Information Officer Brianne Page.

Along with more businesses, Page said the center’s foot traffic has also been steadily returning to pre-pandemic levels. In 2019, the Port reported 2.9 million visitors. The pandemic year of 2020 saw foot traffic down by about 50% with 1.5 million people but Seaport Village drew 2.7 million last year.

In FY2024, the Port will budget about $10.8 million in revenue and nearly $3.8 million in operating expenses for Seaport Village needs. In previous years, the Port budgeted $11.7 million (2020); $7.3 million (2021); $4.8 million (2022) and $9.3 million (2023) in revenue toward Seaport Village. The Port this year is also budgeting $2.4 million in investment spending for tenant improvements through its Economic Recovery Program.

For all the care it’s been given by the Port, Seaport Village has given back financially – from July 1, 2022 through April 30 of this year, the Port’s revenue from Seaport Village was $6.2 million. For the entire year in 2021 Seaport generated $3.71 million which more than doubled in 2022 to $7.86 million.

Future plans for seaport Village include inclusion in a $3.6 billion redevelopment of San Diego’s downtown waterfront by the development group 1HWY1.

Port of San Diego

FOUNDED: 1962
ACTING CEO: Randa Coniglio
HEADQUARTERS: Pacific Highway, San Diego
BUSINESS: Special District
REVENUE: $200+ million
EMPLOYEES: 550
WEBSITE: portofsandiego.org
CONTACT: 619-686-6200
SOCIAL IMPACT: District’s stated mission is to “continuously build and promote a culture of diversity, equity, and inclusion throughout all levels of the organization.”
NOTABLE: Port revenue from Seaport Village from July 1, 2022 through April 30 of this year was $6.2 million.

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