Bosa Development Completes Diega Apartments in Downtown San Diego
Downtown's Third-Largest Building Is Canadian Developer's First Apartment Project in California
Bosa Development this month is opening Diega, a 617-unit apartment complex in downtown San Diego. (CoStar)
By Lou Hirsh
CoStar News
July 22, 2021 | 6:52 P.M.
Bosa Development, a prolific builder of condominiums on the West Coast, this month is opening its first California apartment project, downtown San Diego’s newly completed, two-tower complex known as Diega.
The building at 702 Broadway, in an area of downtown better known for office buildings, arrives after three years of construction and is downtown’s third-largest apartment building by unit count at 617, according to CoStar data. It includes towers rising 41 and 20 stories high.
It is unlikely to add to San Diego’s supply of much-needed affordable housing, however, with an average monthly asking rent of $3,340. That’s well above the downtown average of $2,719 and the San Diego regional average of $2,057.
Filings with the city indicate Vancouver, British Columbia-based Bosa decided to forgo building 10% of its units as affordable and instead paid an in-lieu fee of nearly $4 million to a city fund that goes toward affordable housing programs.
“Building affordable units is still very costly, and in some places like Downtown, it doesn’t provide much of a rebate for builders,” said Joshua Ohl, director of market analytics for CoStar Group in San Diego. “This has been an ongoing struggle to add more affordable units, and one likely to continue, given the sky-high rent growth and record high rent levels across the region.”
Ohl noted that 90% of San Diego County’s apartment construction pipeline consists of luxury units. The region is expected to see 5,000 apartments constructed this year alone, the bulk of them downtown.
CoStar data indicates Bosa and other developers are looking to capitalize on downtown rents that have risen 8.5% in the past year, even though the downtown apartment vacancy rate of 9.5% is currently well above the San Diego regional rate of 3.2%. That said, the pace of leasing for newly built downtown apartment buildings has been steadily rising over the past year.
Bosa officials did not immediately respond to a request from CoStar News for comment. A statement from the developer said Diega is geared to “urban enthusiasts and professionals looking to live in a community full of entertainment,” including several prominent nearby restaurants, museums and art galleries. The property includes a fitness center, yoga studio, rooftop pool, social lounge, coworking spaces, ground-floor retail and a “dedicated pet retreat.”
Over the past 20 years, Bosa has built several luxury, high-rise condominium projects in other parts of downtown San Diego, and began leasing rental units at Diega in April.