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Daily Business Report — Oct. 23, 2009

Tenants in command of industrial market

Tenants are driving the San Diego County industrial market as landlords continue to write aggressive leases — including free rent and generous tenant improvements — to attract new tenants and keep current ones, according to a report by Cushman & Wakefield in a report covering the third quarter. The report shows that San Diego County direct vacancy (excluding sublease space) is at 9.4 percent, compared to 7.3 percent a year ago.   “Landlords are focused on maintaining occupancy during these challenging economic times,” said Tucker Hohenstein, senior director with Cushman & Wakefield. “While significant opportunity exists for businesses seeking to move to more affordable or desirable locations, many tenants are content to avoid moving costs and remain in their current locations, renegotiating their existing leases on more favorable terms.”

Countywide average direct asking rents are at just $.91-per-square-foot per month, down from $1.05-per-square-foot-per month at the same time a year ago. These rents include upward pressure from the research and development sector, which averages $1.25-per-square-foot per month. Otay Mesa and Chula Vista report the lowest industrial rents at $.52 and  $.51-per-square-foot per month, respectively.

Charles Adolphe, director with Cushman & Wakefield, adds that while motivated owners countywide are providing lease packages and incentives that were unheard of a few years ago, those areas of the county that have seen an abundance of new inventory come online over the past several years, such as Otay Mesa, remain the most affordable and attractive for those choosing to relocate. An example of this is Mor Furniture for Less, which recently signed the largest lease of 2009, moving from Poway to a 199,359-square-foot space at 7577 Saint Andrews Ave. in Otay Mesa.

San Diego County year-to-date direct absorption is negative 2,841,386 square feet (negative 491,727 square feet in the third quarter). This compares to negative activity of 312,027 square feet a year ago.

“Tenants defaulting on their leases, downsizings, and space being put on the market for sublease are negatively impacting absorption,” said James Duncan with Cushman & Wakefield. “Even with the exceptional leasing incentives to relocate, unless a tenant absolutely needs more or less space, most are still electing to renegotiate their existing leases and renew for short-term transactions which do not positively impact absorption. We need the economy to pick up again before we’ll see a significant shift in activity. Job growth and consumer spending will be the key indicators of a shift.”

Total countywide lease activity, which includes direct leases and subleases but not renewals, totals 5,514,378 square feet year-to-date.

Duncan added that one bright spot in the market does exist — the high-tech industry, which led the county in third quarter industrial transaction activity. This includes ATK Space Systems, which signed a 114,150-square-foot lease to renew/expand at 7130 Miramar Road in Miramar; Life Technologies, which signed a 59,860-square-foot lease at 1600 Faraday Ave. in Carlsbad; and Verari Systems which leased 38,294 square feet at 6920 Carroll Road in Miramar.

Domestic Violence Unit to be relocated in December

The City Attorney’s Office will move its  Domestic Violence Unit out of the San Diego Family Justice Center to its offices at Civic Center Plaza in December — a move it says will save the city $217,000 a year. “We’ve concluded that we can save the city money and improve efficiency of domestic violence prosecutions,” said City Attorney Jan Goldsmith. “We will not reduce our commitment to the SDFJC one bit. We will be there for victims and hold perpetrators accountable. We’ll just be more efficient.” The Domestic Violence Unit consists of attorneys, investigators, victim advocates and other support staff.

Goldsmith said the City Attorney’s Office will continue to maintain desk space at the SDFJC and the lawyers, investigators and victim advocates will continue to meet with witnesses, police and victims helping the victims understand the court process, keep them on board for trial and provide them with information about resources. All operations of the Domestic Violence Unit, however, will be housed with the balance of the office. “I try to avoid splitting a law office if possible. When there are branch offices there are duplication costs in management, legal books, supplies and equipment,” said Goldsmith. “Now, we will be more team based and can better use our resources.”

Sycuan Resort upgrading its rooms

Sycuan Resort in El Cajon has launched a $2.7 million renovation project to upgrade 100 rooms with new carpeting, high-end drapery and bedding, flat-panel televisions and bathroom vanities. Completion is scheduled for Dec. 31.  The resort selected HFS Concepts 4, a design and architecture firm, for the work. “Guests can look forward to staying in newly renovated rooms transformed to complement the beautiful and expansive grounds of Sycuan Resort,” said Jeff Clough, the property’s newly appointed general manager.

Each room on the Sycuan Resort property has a golf course view.

La Raza Lawyers name Lawyer of the Year

Yuri Calderón, co-founder and managing partner of corporate San Diego law firm GCR LLP, has been named San Diego La Raza Lawyers Association Lawyer of the Year for his service to the local Latino community and his firm’s commitment to diversity. Calderón is the longest-serving member of the executive board of the National Hispanic Bar Association. He has worked as general counsel to different Latino organizations including The San Diego Hispanic Chamber of Commerce, California Latino School Board Association and he is currently the general counsel to the Latino Caucus of the League of California Cities.

UCSD Alumni Association to receive top awards

The UCSD Alumni Association will be presented with three awards at the Council for Advancement and Support of Education (CASE) District VII conference Nov. 14-17 in San Francisco. The Awards for Excellence recognize best practices in alumni relations, fundraising, public/government relations, advancement services, special events and outstanding communications. CASE district VII represents higher education institutions in the western region of the United States, including Arizona, California, Guam, Hawaii, Nevada and Utah.

The association was given Gold Medals for Creative Use of New Technology and for New Programs, and a Silver Medal in the category of College and General Interest Magazine.

Most Innovative Products Awards finalists announced

CONNECT has announced finalists for its 22nd annual Most Innovative Products Awards program honoring local high-tech and life science innovation. The winners will be announced at an awards luncheon Dec. 11 at 11:30 a.m. at the Hilton La Jolla Torrey Pines. The finalists’ products will be on display at the event. The luncheon is $140 for CONNECT members and $160 for nonmembers. For more information, call Nancy van Dillen at (858) 964-1315.

More than 100 companies competed for awards in eight categories. The finalists are:

Action and Sport Technologies

Impact Sports Technologies, for ePulse

Neptune Technologies, for Neptech Protective Material

TaylorMade Golf Co., for R9 driver

Aerospace and Security Technologies

Ebert Composites Corp., for Thermoplastic Composite Armor Processing

Intevac, for Night Port

Pixon Imaging, for PX40

Space Micro, for Thermal Protection Coating, TPC

Clean Technology

On-Ramp Wireless, for Ultra-Link Processing Wireless Communication System

ecoATM (formerly reMobile), for ecoATM

Ultraviolet Sciences, for Ultraviolet Water Purification

Communications and IT

Mushroom Networks, for Fusion Internet

Nextivity, for Cel-FI

Nirvanix, for Nirvanix CloudNAS

Hardware and General Technology

Cymer, for XLR 600ix

FreightScan, for FS100

Rapid Bridge, for LiquidCell Library

Life Science-Diagnostics and Research Tools

Naviscan, for Stereo Navigator Breast Biopsy Accessory

ResMed, for ResMed ApneaLink Plus

Ridge Diagnostics, for MDD Score

Life Science-Medical Products

Dhart Development, for NailSkins Elastomeric Bandages

Novaiar Pharmaceuticals, for OraVerse

SynergEyes, for ClearKone


Anakam, for Anakam.TFA

DialPlus, for DialPlus

V-Enable, for LocalAdXchange

About The Daily Business Report

The Daily Business Report is a product of REP Publishing Inc., publisher of San Diego Metropolitan magazine and the North Park News. Our offices are in Cabrillo Plaza, 3990 Old Town Ave., Suite A-201, in Old Town. To reach editorial, call (619) 906-4104. For advertising, dial (619) 906-4105. The fax is (619) 906-4106. Send editorial material via e-mail to For advertising, send to

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