Banking On Life Sciences, Cresleigh Homes Plans Downtown San Diego Resi Tower
There are nine residential towers under construction in downtown San Diego, and soon one more tall one might be added to the list: A project has been proposed that would bring a 37-story residential high-rise to a property near Petco Park.
The developer, San Francisco-based Cresleigh Homes, is proposing building 443 apartments on a site at 611 Island Ave., between sixth and seventh avenues near Petco Park, replacing the Ballpark Self Storage facility, the San Diego Union-Tribune reported.
CBRE Senior Vice President J. Kevin Mulhern told the Union-Tribune that there are really only two places in the area where developers can get the rents that would make this kind of project feasible: downtown and University City.
That's saying something considering that San Diego rents are climbing. The area's average monthly rent hit a new high of $2,441 at the end of 2021 after climbing 17.1% year-over-year, according to CBRE.
Developers are looking at rent gains and, with life sciences companies really flocking to and growing in San Diego, are anticipating future gains too, Mulhern said.
“There’s already a lot of jobs downtown,” he told the Union-Tribune. “The bet a lot of developers are making now is there will be a lot more jobs in the future.”
Downtown is seen as a growth market, as available space in the Torrey Pines, UTC, and Sorrento Mesa and Valley areas becomes harder to come by. The life sciences market employed just under 70,000 people in San Diego as of the first quarter of this year, CBRE found.
Other developers are betting big on life sciences having knock-on effects. San Diego-based developer IQHQ is building a downtown office project expected to cost $1.6B in a similar bet on life sciences growth. IQHQ paid $230M for the site.