Artist’s rendering of a military apartment project at Naval Station San Diego for single sailors.

The nation’s first large-scale military apartment project devoted exclusively to unmarried sailors — three buildings containing 941 two-bedroom apartments — is expected to break ground in the second quarter of 2006 at the 32nd Street Naval Station under a partnership between the Navy and Clark Realty, a Maryland-based real estate and construction company.

Clark Realty describes the tower, to be called Pacific Beacon, as the first phase of a 1,200-unit development that will ultimately house more than 2,400 sailors at Naval Station San Diego. Construction of the first phase is expected to be completed in 2008. The resort-style nature of the project is unusual for San Diego military installations.

Pacific Beacon will be built on 15 acres on the dry side of the 32nd Street Naval Station near Main Street. Each of the apartments will be shared by two sailors, although members of other military branches also may rent units. The residences will have open living areas, full kitchens, washer/dryers and balconies with views. Both bedrooms will have large walk-in closets and private bathrooms. The buildings also will contain entertainment, fitness and educational amenities.

“This project is part of the Navy’s Public Private Venture program, which allows the Navy to leverage Clark’s private-sector capital and expertise to develop, manage and improve military housing,” says Bill Geibler, marketing and communications executive with Clark. “The Navy is able to provide its men and women with the best housing the marketplace has to offer with a minimal tax-dollar investment.”

Each sailor living at Pacific Beacon receives a basic allowance for housing from the Navy, a market-based stipend that will be used as rent for the apartments. Rent payments include utility costs and basic renter insurance. “We were able to finance this project by issuing bonds on Wall Street, and these bonds are backed by the future revenue stream of the basic allowance for housing,” says Geibler.

Geibler says the Navy’s Public Private Ventures are long-term partnerships, not government contracts. Through a request-for-proposal process, the Navy chose Clark Realty to enter into negotiations for a 50-year equity partnership. Clark has chosen Pinnacle, a real estate investment management company headquartered in Seattle, to be project manager. Clark partnered with Lincoln Property Co. on Navy Region Southwest’s Gateway Village townhomes in Loma Portal.

Clark Realty’s plans for Naval Station San Diego also include improving exterior amenities at Palmer Hall, a 12-story building that houses about 1,000 single sailors dormitory-style. The company will add a 25-meter lap pool, a resort-style pool deck area and a clubhouse. Residents of Pacific Beacon will be able to share use of these facilities.

The housing is exclusively for single enlisted sailors E-4 and above, called “unaccompanied sailors” by the Navy. Geibler says it is the first project of its kind in the country.