SkyscraperPage Forum - SAN DIEGO | Boom Rundown, Vol. 2

Benefactor steps in to help San Diego entice developers to remake downtown’s Civic Center

The Prebys Foundation is paying real estate consultant U3 Advisors to come up with a big-picture vision for six city-owned blocks in the heart of downtown

Union-Tribune
BY JENNIFER VAN GROVE
APRIL 2, 2024 5:30 AM PT
Link to Article

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A prominent philanthropic organization has cut a $303,000 check to hire an outside consultant to help San Diego sidestep repeat failure as it seeks to secure developer interest in remaking the city’s Civic Center real estate.

On Tuesday, the Prebys Foundation and the Downtown San Diego Partnership announced that they’ve hired Philadelphia-based real estate consulting and urban planning firm U3 Advisors to come up with a big-picture vision for the six downtown blocks that the city intends to once again market for sale or lease later this year.

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The effort brings back to the surface Mayor Todd Gloria’s push for a “once-in-a-generation” transformation of San Diego’s municipal core. The idea is to not only offload the city’s deteriorating buildings and underused land, but to find a private development team to create a new hub of activity and hundreds of homes in the city’s core. The land transaction would then help fund the construction or purchase of a brand-new City Hall facility to house the city’s downtown workforce.

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But the Civic Center Revitalization solicitation, as it was called, failed to attract developer interest, save for two parties interested in the Ash Street tower.

The lack of interest was due in part to California’s Surplus Land Act, which regulates how municipal agencies offload excess land and prioritizes the production of housing for low-income families. At a minimum, interested developers were required to set aside 25 percent of proposed units as affordable units, meaning deed-restricted for families making 80 percent or less of the area median income.

In recent weeks, the city has telegraphed its intent to try again.

The timing is contingent, however, on two key decisions. The city must first decide whether it wants to continue negotiating with the developer proposing to convert 101 Ash into apartments. It must also determine whether it wants to build an all-new City Hall complex or buy an existing property. The latter choice will see the city either retain the City Operations Building block at 1222 First Ave. for a future skyscraper or free up that land for sale or lease.

In the interim, U3 Advisors will craft creative concepts for the municipal blocks that retain their civic nature.