Kilroy Realty Corp., the dominant office landlord in San Diego's Carmel Valley office market, has signed banking giant JP Morgan Chase and consulting firm Deloitte to office leases at its under-construction One Paseo development, the latest indicators of high demand that could keep the neighborhood's office rents among the region’s highest.
Zoning Partially to Blame for Lack of Housing: Report
A new report is looking into why there is a shortage of homes for sale around the country. According to the report by NerdWallet , in October of 2017, the US had a 3.9-month supply of existing homes for resale, meaning at that pace, it would have taken 3.9 months to sell all the homes on the market.
San Diego Tech Companies Receiving Record Investment
Illumina’s San Diego Campus
Tech investment in San Diego is set for a record year. According to research from JLL, tech investment in the first quarter has already surpassed $408 million, one-third of the total investment volume in 2018
San Diego Unemployment Rate Matches 10-Year Low
San Diego matched the lowest unemployment rate in a decade in May with the latest jobs report. Unemployment fell to 2.8%, the same mark as a year ago and the trough for this benchmark over the past 10 years. For comparison, California’s unemployment rate was 3.5% while the nation's was 3.4%.
The Commercial Office Market is Surprising Everyone
Warning signs were abound with the advent of the Internet and Co-Working concepts, but commercial trades and leasing of office space are tracking strong. Institutional investment has grown a bigger part of sales transactions and rent growth has paced above national averages.
Affordable and Inclusionary Housing Mandates: How Could They Effect Housing Supply?
The City of San Diego Rules Committee voted to approve an increase to the city’s inclusionary housing requirement on all new residential projects. Inclusionary is a government mandate that all new housing developments set aside a specific number of homes at below market cost. The new rules would also require a $22 per square foot fee charged on new homes in lieu of the set aside requirement.
At the end of almost 3 hours of testimony from industry leadership and others, the Committee voted 3-2 to move the proposal to the full city council. Voting yes were Council President Georgette Gomez and Councilmembers Chris Ward and Barbara Bry. Councilmembers Chris Cate and Mark Kersey voted against the plan citing the negative impact the new restrictions would have on housing prices, rents and supply.
A city study found that construction costs and rents would have to increase to offset the losses associated with the inclusionary mandates. A subsequent analysis by Point Loma Nazarene University Economist, Dr. Lynn Reaser concluded that overall housing production would plummet by nearly 900 units each year as a result of the new mandates.
The proposal comes at a parlous time for housing production with permit activity down 73% compared to the same period last year. Most analysts attribute the steep decline to rising construction material costs and government regulations that lead to higher prices. The draft policy moves to the Planning Commission in June followed by a full City Council hearing in late July.