Construction Fever : Hotels, Penthouse Suites Add Diversity to Booming Downtown San Diego
striking transformation of downtown San Diego, where spindly construction cranes seem a permanent fixture on the skyline, shows no signs of abating in 1990 as several large-scale projects--from high-rise hotels to small-scale condominiums--are expected to break ground.
When combined with developments already under construction or scheduled to open this year, it is clear that downtown remains on fast-forward, in a boom cycle the upward spiral of which began in the mid-1980s.
This year’s construction comes with a new twist: housing, from tiny and inexpensive one-room shelters found in single-room occupancy hotels to sumptuous, multimillion-dollar penthouse condominiums perched on 41-story towers.
The emphasis on residential construction is a departure from high-rise office buildings that have dominated downtown development. That is not to say that the office market is dead downtown. On the contrary, several large buildings are under construction and more are in the planning stages.
But this year, the majority of new projects will be residential, a phenomenon that thrills downtown land-use planners.
For all of this year’s development activity, it promises to be merely a precursor to 1991. Barring a worldwide economic downturn, downtown construction next year is expected to be even more dramatic, with several apartment, condominium and office towers scheduled to break ground, according to both private real estate experts and government land-use planners.
“The key ingredients for a vital downtown are coming together,” said Kraig Kristofferson, an associate vice president of Coldwell Banker commercial real estate brokers who specialize in downtown office space. He cites the long-awaited opening of the new Convention Center, the emphasis on residential construction and construction of hotels as indicators of a vibrant downtown.
Although there are fears that the office market might be overbuilt, Kristofferson maintains otherwise, saying that there is room to expand and that office absorption rates are healthy enough to propel more construction. “Downtown is the strongest office market in all San Diego,” more so than Mission Valley or the Golden Triangle in La Jolla, he said.
It’s strong for offices but traditionally weak for housing, despite the push by city and redevelopment planners to make downtown an attractive residential market. That effort has included offering developers incentives such as government subsidies and low-interest loans.
Although such incentives are still needed in some cases, as with the construction of single-room-occupancy hotels that offer low-priced, bare-bones efficiency shelter, developers increasingly compete on the open market to build housing downtown as they would anywhere else.
In the last few years, as anti-growth sentiment in suburban parts of the city has led to frequent attempts to limit development in those areas, downtown proponents have jumped in, marketing center city as a place hungry for housing.
The premise behind this strategy is that what downtown needs more than anything else is people: middle-class folks who have a stake in its enhancement as a neighborhood. According to the theory, as the area becomes identified with a range of housing types and prices, it will become a magnet to even more people, leading to the real goal, the metamorphosis of a once-moribund urban core into one with a sense of vitality and life.
At least that’s how the city’s government planners see it.
“I think you could say that 1990 is the year of housing,” said Paul Desrochers, a top administrator with Centre City Development Corp., the agency in charge of downtown redevelopment. Of the about 40 major projects breaking ground, under construction or scheduled to open in 1990, almost half are housing projects, a plethora of plans encompassing single-room-occupancy hotels, artists’ lofts, apartments and both low-scale and massive condominium complexes.
And, for the first time, the city will see the construction of a “living-unit” project. The low-cost hybrid offers shelter that is larger than a room in a single-room-occupancy hotel but smaller than a studio apartment. The city has approved the project in an effort to increase affordable housing.
“We’ve worked hard to make downtown a good place to market residential projects,” said Larry Monserrate, a principal planner for the city of San Diego who specializes on downtown.
Monserrate, who works with the Centre City Planning Committee headed by Horton Plaza developer Ernie Hahn, said not only has the committee recommended enlarging the area downtown where housing can be accommodated, but it has also recommended giving developers construction bonuses, allowing them to build bigger projects if they are predominantly residential.
There are, however, holes in downtown’s glossy future. Aside from an economic downturn reverberating through the development industry, the major damper on continued housing construction downtown is the homeless and the transients, among them the mentally ill, whose presence is apt to repel fence-sitting downtown housing customers.
Although the building of single-room-occupancy hotels has helped provide shelter for some of those who have been able to find jobs, planners such as Desrochers say much more needs to be done.
But he acknowledges that his agency, as well as others, have pressed so hard for bricks and mortar that serious, comprehensive solutions or alternatives to deal with the street population have been largely ignored.
The remedy for the most part has been left to social agencies, from the Rescue Mission to the St. Vincent de Paul Joan Kroc Center for the Homeless, which are mainly concentrated in Centre City East.
One exception will be evident this year. Scheduled to break ground in the spring is the Neil Good Day Center for Homeless Men, an experiment in keeping homeless men off the streets by giving them someplace to go during the day, someplace where they can be safe, where they can take a shower and perhaps get a foothold on entering mainstream society.
The $705,000, 5,000-square-foot facility is being paid for by a combination of private funds, the San Diego Unified Port District, the county and the city. It will be located on a strip of California Department of Transportation right of way on 17th Street, between J and K streets, at the Interstate 5-Imperial Avenue off-ramp.
Although the homeless day center and other single-room-occupancy hotels are slated for construction in 1990, the glitzy high-rises will fetch the most attention, primarily because they are too large to overlook.
Three major ones are scheduled to break ground near the waterfront.
One is One Harbor Drive, consisting of two slender towers, each 41 stories high, containing a total of 202 condominiums.
Built on a triangular tract across the railroad tracks from the new Convention Center, the towers will have units ranging from 1,119 square feet with one bedroom to 4,878-square-foot penthouses. They will also be the most expensive condominiums yet built downtown, with prices starting at $271,000 and running up to $2.5 million, according to Suzette Y. Gauvin, director of sales and marketing for the project and an employee of Stark Properties.
A long fly ball away across Harbor Drive, the long-awaited 40-story, 875-room Hyatt Regency is also scheduled to break ground. Developed by Doug Manchester’s Torrey Enterprises, the hotel and the huge adjoining 1,250-car garage will open two years after construction begins in April.
A short distance away, near Horton Plaza, the biggest of the three--Roger Morris Plaza--is scheduled to break ground in the third quarter of 1990.
The central feature of this complex, spread over a block and a half, is a 50-story tower. The development will have 750 hotel rooms, 150 apartments and an underground parking garage with 800 spaces.
Although not on the same scale as the big three, the expansion of Seaport Village is also scheduled to start this year, according to Roger Manfred, a partner and director of Seaport Village. He is also president and chief executive officer of the firm that is developing Roger Morris Plaza.
Officials and developers say construction downtown probably would be even greater this year if not for an underground plume of gasoline. The plume has delayed several residential projects while redevelopment officials try to find a long-term cleanup solution, an effort that has already consumed more than a year.
If a comprehensive plan to clean up the toxic waste and determine legal liability is arrived at soon, then two other high-rises will probably begin construction next year. One would be the 32-story, 368-unit Tyson Plaza apartment tower across G Street from Horton Plaza, and the other would be the Courtyard, a 40-story, 400-unit apartment high-rise on the next block bounded by G, Market and Front streets, and 1st Avenue.
