It’s more than two years since we explored the “new south” in this column. As you may recall, our mood was cautiously optimistic, awaiting the ground breaking of the new State Route 125 tollway. We opined the roadway’s opening would have a major effect on the depth of demand for South County housing as well as a dramatically accelerating demand for retail space and services.

Finally, after 20 years of planning, SR-125 has broken ground. It is on schedule to be completed in fall of 2006, just two short years from now. When it opens, it will place eastern Chula Vista area within a 15-minute drive of the vast number of employment centers in Mission Valley and Kearny Mesa.

Pointedly, it will do for eastern Chula Vista what the completion of Interstates 5 and 15 did for North County, and a lot faster. Already, East Chula Vista is providing more than a third of all the new single family homes in San Diego County and is on a near par with south Riverside County in terms of production.

Equally as interesting is the rapid rise in home size and price in East Chula Vista as the major builders gradually begin to reproduce Carmel Valley. Four years ago, the average new single family home in the area was 2,309 square feet and sold for $277,319. Today, four years later, the average size of 2,572 square feet sold for $632,703 — a modest price change of 128 percent.

In addition to the single-family home building, condominiums are beginning to surface, bringing the area a new range of affordability. More than a dozen condominium projects are on the market, most of them low density townhomes selling in the $300,000-400,000 range. Not quite cheap, but reasonable.

The pricing of homes today in East Chula Vista is on a par with the prices of Carmel Valley in 2000. The accompanying table indicates that home prices in Carmel Valley have now exceeded $1 million. Clearly, the “white collar” taboo of living south of Interstate 8 is fast disappearing as the home prices north of I-8 are reaching the point of absurdity.

The mathematical computation of number of homes times the average household income (pushing $90,000) results in an enviable demand for retail goods and services. That Econ 101 formula has resulted in an enormous burst of retail development in the area known as the “eastern urban center” of Chula Vista. In the past year, three major retail centers have opened for business and another one is on the way.

The first major center is the newly opened 400,000-square-foot EastLake Village Market-place with Lowe’s and Target. Designed for Sudberry Associates by Fehlman LaBarre, it is one of the more attractive power centers in the county and should be a home run. Right across the street is the new Kohl’s Department Store Center, another winning retail entry.

One of the area’s more charming shopping centers is the Heritage Towne Center in Otay Ranch. Newly opened, the 30,000-square-foot center features a 60-foot clock tower and is part of a village to be surrounded by a school, senior housing and other urban facilities.

Still to come is a McMillin-backed regional shopping center that will no doubt open on the heels of the SR-125.

Needless to say, thousands of new homes create massive demand for home furnishings. Fortunately for these homeowners, VTS Development soon will develop the 450,000-square-foot EastLake Design District. The first phase, with more than a dozen showrooms, opens in spring. Talk about ducks in a barrel.

Then comes the office space. Doctors, dentists, lawyers, accountants, financial planners, chiropractors, wily economic consultants and State Farm agents. The rule of thumb is that every person added to a community generates 20 square feet of demand for office space. Answering the call, the EastLake Corporate Center will contribute 170,000 square feet of space in two Class A buildings. Many more buildings will be needed to serve the burgeoning population.

Sure this is beginning to sound like a chamber of commerce promotion for Eastern Chula Vista, but no promotion is needed. It is happening on its own and we have only taken a snapshot in time. Just like Downtown San Diego, come back in five years and you won’t recognize the place.

Last thought: when the SR-125 opens, the cross-border traffic will soar, especially with the recently initiated transponder-based fast track crossing. And soon the Toyota plant east of Tijuana will unleash an annual production of 180,000 Tacoma truck beds and 20,000-plus Tacoma trucks. Toyota will import from the United States more than 90 percent of its parts for assembly, making the cross-border activity two-way. This, plus the newly rising activity in the other maquiladoras, will result in an expanding demand for industrial and office space in both Eastern Chula Vista and Otay Mesa.

As the legendary Phil Harris crooned in his theme song: “And that’s what I like about the South.”

Alan N. Nevin is director of economic research with MarketPointe Realty Advisors (marketpointe.com), a consultancy providing real estate and demographic statistics, feasibility studies and litigation support to the California land use industry and legal professions. Nevin can be reached by e-mail at anevin@sandiegometro.com.