Veritas Urban Investing In Redevelopment Of Hillcrest And Point Loma Neighborhoods
The City of San Diego is updating the Uptown Community Plan, a redevelopment district with six distinct neighborhoods and some of the highest allowable densities in the region outside of Downtown—up to 74 and 109 units/acre along transit corridors. The update, which will be considered by the City Council on Nov. 14, would provide an opportunity to build 9,500 additional units, the majority of which would involve vertical redevelopment in the Hillcrest Gateway district, Uptown’s commercial core just north of Downtown.
Bisnow caught up with Veritas Urban Properties principal Russ Murfey, who is among the developers presenting at Bisnow’s State of San Diego’s Multifamily Market event Oct. 19, to learn more about how this plan will impact multifamily developers.
Veritas Urban Properties is the real estate development arm of Murfey Co, a vertically integrated firm that handles everything from site acquisition, entitlements and investment capital through construction and ultimately property and asset management. “There’s a ton of opportunities for building new product in Hillcrest,” he tells us, suggesting redevelopment will involve replacing low-density housing with higher-density projects.
Russ, along with his business partner and brother Scott (pictured at right with Russ), recently completed the Crest Urban Apartments (below) at 4021 8th Ave in Hillcrest, a 36-unit project that replaced a 50-year-old, dilapidated apartment building with 22 units. This project, which is 100% leased, consists of 28 one-bedroom and eight two-bedroom units, ranging from 670 SF to 1,120 SF, and includes walk-in closets, storage and oversized decks, he says.
Russ says Veritas Urban is a long-term investor and builds urban infill projects that enhance or fit the character of neighborhoods where they’re located. "We generally include a small amount of retail in projects to activate the streetfront," he says, "but that retail didn’t fit this location, and therefore is 100% residential." The project is close to the commercial heart of Hillcrest and walking distance to Whole Foods, Trader Joe’s and restaurants along University Avenue.
“Retail has to have the right location to be successful,” Russ says. “We want to develop projects that create a sense of community, rather than just build units. For us, civic pride is important.” He says the ultimate goal is to create neighborhoods with lifestyle amenities, and in some cases, inspire neighborhood improvements in areas undergoing transition. Russ says Veritas Urban has built multiple new projects that served as catalysts for revitalization, causing other business owners on the street to upgrade their store façades.
“Hillcrest has always been a desirable area, but now is a hotspot for growth,” Russ says. “It has nightlife, museums, parks, restaurants and cultural amenities. It’s also centrally located to provide easy commute to work anywhere in the city and is close to the airport." There are three hospitals and the 1,200-acre Balboa Park nearby.
One of the oldest urban parks in the nation, Balboa Park was the site of the first World’s Fair and includes open space, natural vegetation zones, green belts, gardens, walking paths, museums, several theaters, restaurants, community recreational facilities and the San Diego Zoo.
Veritas Urban is getting ready to break ground on Veritas Point Loma (below), an 82-unit mixed-use project in the Midway District of Point Loma, the second new multifamily project built in this area in 30 years. The company also built the first project here, the Famosa Townhomes (above), a nine-unit, luxury condo community with a retail space on the ground level occupied by The Coffee Bean & Tea Leaf. Both projects are within walking distance of restaurants and shopping areas.
This area is just beginning to undergo revitalization, but that will pick up speed when the San Diego Sport Arena’s lease with the city expires in 2020, Russ tells us. The city not only owns the land where the sports arena is located, but also the surrounding land occupied by businesses. As land leases expire, this whole area will be revitalized, changing the landscape of this up-and-coming coastal area dramatically, he says.
While there are plenty of opportunities to build multifamily projects in SD, Russ says financing is more challenging these days. “Due to the extreme decline in the last downturn, people are hesitant to put their necks on the line, but their concern may be a little premature,” he says. “There still is abundant capital available, but investors are being more selective. There’s a lot of new projects coming online, so investors are picking and choosing projects that fit their business plans."
Hear more from Russ and other local multifamily experts at Bisnow’s State of San Diego’s Multifamily Market event Oct. 19, at 7:30am with breakfast and networking at the Westin San Diego Gaslamp Quarter 910 Broadway Circle.