Edition: June 2006



 Real Property

 By Alan N. Nevin
PropertyMaps: MLS Real Estate Search


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The All New 2006 Escondido
Urban development is helping Escondido’s
downtown live up to the dream

In years past, the city of Escondido has been considered a tertiary location, much like most of East County. For most San Diegans, Interstate 15 stopped at Rancho Bernardo, rarely venturing past Lake Hodges. At the same time, it wasn’t considered part of the Highway 78 corridor, either. That was reserved for Oceanside-Carlsbad-Vista-San Marcos.

Escondido just didn’t fit in anywhere except as a place to go through on the way to the Wild Animal Park. The image gradually was enhanced when Ernie Hahn built North County Fair, now called Shoppingtown North County. The 1.25 million- square-foot regional shopping center’s 200-plus tenants include Nordstrom, Macy’s, Sears and JCPenney. It lacks a theater and has few out-parcels with signature restaurants, but it is still a regional shopping center of major proportions and serves the entire Highway 78 and I-15 corridor.

Another boost to Escondido was the development of the California Center for the Arts, a marvelous venue for music and drama. It is beautifully designed and has plenty of free parking. It has had financial problems in years past, but that situation has stabilized. Its problem has been that its size is a tad too small to attract big names and too big for groups that can’t fill its 1,523 seats. In addition, its public space (art gallery et al) has not been endowed with sufficient funds to showcase big draw attractions. Although Escondido sounds far away, I can actually leave my home in La Jolla and be in a seat at the California Center for the Arts faster than I can get to the Civic Theatre in Downtown San Diego.

The Center for the Arts was to have been the centerpiece of downtown Escondido. But the center opened a decade ago and development languished. Now it appears that there is a spark of life. Two years ago, Signature Theatres opened its Escondido Stadium 16 (with the obligatory stadium seating) as part of a well-designed shopping center featuring a dozen eateries.

Finally, after a decade of trying, downtown Escondido is getting a hotel. C.W.Clark Inc. is going to be developing a 200-room Marriott Courtyard and conference center next to City Hall. Across the street from the Marriott, Clark is planning a 100-plus vertical condominium project.

Also on the downtown residential scene, Kevin deFreitas is developing a series of 15 1,200- to 2,000-square-foot detached townhomes, reminiscent of his highly successful project at 10th Avenue and F Street in Downtown San Diego.

D.R Horton is now offering its Paramount Townhomes in downtown Escondido. This 122-unit project has units ranging in size from 1,783 to 1,941 square feet and is selling in the high $400,000s.

Recently, Barratt announced its City Square townhomes at Orange and Second. The 102 units are sized from 1,191 to 1,922 square feet and will be priced in the $400,000s.

On the north end of downtown, on the old K-Mart site (have you heard that story before?), Sunset Centers will develop a 138,000-square-foot Lowe’s store along with 164 condominiums. Last year, William Lyon Homes proposed a 600-unit condominium project on the site, but it was rejected because the city wanted the property taxes from a retail operation. The new plan satisfies the city.

Unfortunately, Escondido is running out of land. Fortunately, there is substantial acreage in its downtown, most of which is underutilized. The city has a wonderful opportunity to be the urban hinge between Downtown San Diego and Oceanside. In their neck of the woods, there are few communities that attract the educated young singles and couples market. Escondido can serve as that center of activity in years to come if there are enough stars aligned.

The alignment means that a number of residential communities build up a mass of population in a relatively short period of time. Along with that has to be a cadre of retailers and service providers willing to develop the types of activities that appeal to the yuppie market. So far, more than 50 restaurants and eateries are downtown. The eatery total includes the venerable 150 Grand, a high-quality restaurant that anticipated substantial downtown residential development when it opened many years ago. Finally, they’re going to get it.

As Downtown San Diego becomes increasingly pricey, opportunities are opening for outlying venues like Chula Vista, National City and Escondido to serve that urban-loving market. It takes a fair degree of courage by city councils to build a downtown. It often takes bonded indebtedness, tax incentives, condemnation and a lengthy self-serving campaign to encourage developers to take a chance on an unknown.

But time cures a lot of things. San Diego developers, by and large, are desperate for development opportunities as the suburbs run out of land, leaving them few avenues for development. For many, building vertically is an entirely new business and a scary one at that. If you make a mistake in a single-family model compound, you can just develop a substitute home, but if you make a mistake in the unit mix or square footage in a 10-story building that is in mid-construction, you have a problem. Similarly, if the market slows down for single-family homes, a builder just builds fewer starts. But if a 10-story building is already constructed up to the fifth floor and the market dies, the problem is severe.

Overall, the urban cores of metropolitan area cities like Escondido have wonderful opportunities to have real downtowns. It doesn’t happen overnight, but it will happen.

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.


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