Daily Business Report — July 15, 2014
The Cross-Border Xpress project includes a large terminal on the U.S. side of the border in Otay Mesa.
Cross-Border Bridge to Give Airline Passengers
Direct Access to Tijuana International Airport
Construction has started on the Cross Border Xpress, a new, elevated pedestrian bridge that will connect Tijuana International Airport to a new passenger facility in Otay Mesa to make life a whole lot easier for airline passengers crossing the border.
The bridge is part of a $120 million private project connecting a terminal on the U.S. side of the border directly into a foreign airport terminal — the first ever.
Officials said the Cross Border Xpress will serve the approximately 2.4 million passengers who already cross the border as part of their travels, and will help them avoid unpredictable, often long delays at congested San Ysidro and Otay Mesa land ports of entry. Users of the bridge will be able to access the more than 30 destinations within Mexico that Tijuana International Airport (TIJ) offers, many of which are not served by other Southern California airports. TIJ also has direct flights to Shanghai and Tokyo.
The terminal will be located south of Interstate 905 in Otay Mesa and is expected to open for passenger crossings in summer 2015.
The project is being developed and operated by Otay Tijuana Venture LLC, a private investment group with U.S. and Mexican shareholders. Investors include PAP Corp, Palareo Inc. and EGI-Otay Investors.
In the U.S., the Cross Border Xpress will feature more than 65,000 square feet of indoor and outdoor patio waiting areas for passengers and guests, retail, food and beverages, fully bilingual customer service and information, and short-to long-term parking. The bridge itself will be 390 feet long, enclosed with divided north/south corridors. Inside the TIJ terminal, construction is under way to accommodate the landing of the bridge and improve passenger facilities with new areas and amenities.
U. S. Customs and Border Protection, which has participated in the design of the San Diego facility, will staff operations at the Cross Border Xpress through an agreement with the project’s ownership.
“This is a great example of private investment creating much-needed public infrastructure to facilitate safe, secure travel and trade,” said Mark Cafferty, CEO of the San Diego Regional Economic Development Corp. “A multi-million dollar binational private investment in our region will create capacity for more than two million border crossing per year, that will translate to job creation, industrial development, and competitiveness for the San Diego-Tijuana Region.”
Officials said the Cross Border Xpress also will broaden Tijuana’s industrial, tourism and commercial platform while it also strengthens its position as a Maquiladora destination.
The project is being financed by Bancomext and Invex, with construction under way by Turner Construction and Hazard Construction in San Diego, and Grumesa S.A. de C. V. in Mexico. Architect Legoretta + Legoretta designed the project in conjunction with Stantec.
Council Votes Minimum Wage Increase 6-3
The minimum wage in San Diego will go up at the beginning of next year after the City Council on Monday approved the hike and a requirement that companies offer five earned sick days annually. By passing the increase directly, the council, by a 6-3 margin, skipped the original plan by council President Todd Gloria to put the issue to a public vote in November.
Council members Mark Kersey, Scott Sherman and Lorie Zapf cast the dissenting votes.
The ordinance will increase the hourly minimum wage to $9.75 on Jan. 1, $10.50 in January of 2016 and $11.50 in January of 2017. Beginning in January 2019, the pay scale will be indexed to inflation.
“San Diegans know that a stronger workforce and a stronger economy will result from passage of the proposal (tonight) and will get San Diego just a bit closer to being a great city,” Gloria said.
— City News Service
Officials to Dedicate Historic Raise of San Vicente Dam
The San Diego County Water Authority will dedicate the San Vicente Dam Raise, the largest single expansion of water storage in San Diego County history, on Wednesday morning.
Starting in 2009, crews raised San Vicente Dam by 117 feet, increasing its storage capacity by 152,000 acre-feet. The new capacity will allow water to be stored within the region for use in dry years.
The dam is also part of the region’s Emergency Storage Project, enhancing local storage in case an emergency such as an earthquake interrupts imported water deliveries.
Officials attending the ceremony include Thomas Wornham, chair of the San Diego County Water Authority board of directors; San Diego Mayor Kevin Faulconer; John Laird, secretary of the California Natural Resources Agency; and Maureen Stapleton, general manager of the Water Authority.
Balboa Park Conservancy and Balboa Park Central Merge
The Balboa Park Conservancy and Balboa Park Central, organizations dedicated to protecting and enhancing the park, have merged, the groups announced today. The merged organization will operate under the name of The Balboa Park Conservancy.
“Working on behalf of the entire Park, the newly merged Balboa Park Conservancy will work to keep Balboa Park magnificent by sustaining and enhancing its beauty and its historic, cultural and recreational character for the enduring enjoyment of all,” said Carol Chang, Conservancy board president.
Established in 1923 and operating the historic House of Hospitality since 1937, Balboa Park Central’s focus for the last 91 years has been on visitor experience, marketing the park and collaborative programs. Formed in 2011, the Conservancy works to help the city maintain and beautify the park.
Officials said the Conservancy will continue to operate its current programs, and combined with Central’s programs will include the Balboa Park Visitors Center; Balboa Park Marketing; Balboa Park Family Days; Balboa Park December Nights; and the identification of restoration and enhancement projects within the park — its first such major project being the restoration of the Botanical Building, anticipated to be completed in 2015.
Torrey Reserve West Sells for $39.2 Million
Lionstone Investments, a Houston-based national real estate investment firm, has acquired Torrey Reserve West, an office complex in Del Mar Heights, for $39.2 million. Completed in 2000, the complex consists of three two-story buildings totaling 118,030 square feet and surface and structured parking. The property is 90 percent leased.
California Center for Sustainable Energy
Changes Name to Reflect Broader Role
The San Diego-based California Center for Sustainable Energy has changed its name to the Center for Sustainable Energy to reflect an expanding role beyond California.
As the Center for Sustainable Energy, or CSE, nonprofit organization has recently taken on several programs in other states. These include administering newly established electric vehicle rebates in Massachusetts, directing the Department of Energy’s (DOE) Combined Heat and Power Technical Assistance Program for California, Nevada and Hawaii and leading part of DOE’s nationwide SunShot Initiative Rooftop Solar Challenge.
In California, CSE will continue substantial efforts with state agencies, local and regional governments, organizations and other energy sector stakeholders to advance renewable technologies, clean transportation and energy efficiency, according to officials.
“This change represents our transition to serving a wider role as market transformers and implementers of change in helping the nation reach its ambitious sustainable energy and greenhouse gas emission goals,” said CSE Executive Director Len Hering.
CSE has offices in Los Angeles and Oakland and currently employs 90 staff members.
Education Pavilion Completed for Lux Art Institute
ENCINITAS — Dempsey Construction has completed a new 7,000-square-foot Education Pavilion for the Lux Art Institute located at 1550 S. El Camino Real in Encinitas. The $1.2 million project included demolition of existing improvements, all site work, building construction and interior improvements for the new Education Pavilion, which will be used for travelling artists to showcase their works in progress. Specific improvements to the building included a new wood frame and stucco building with standing seam metal roof, operable glass storefront systems, open ceiling with exposed lighting and hard ducting, operable sliding barn doors, full kitchen build-out, and new exterior hardscape and landscape with pedestrian bridges.
The Lux Art Institute supports artists in development of new projects through a residency program, with the goal of educating and engaging the community to foster an appreciation of the living artists and creation progress.
First Flight of Updated Predator XP Termed Successful
General Atomics Aeronautical Systems Inc. announced the successful first flight of Predator XP, an updated version of the company’s flagship Predator RPA that has been licensed by the U.S. government for sale to countries in the Middle East, North Africa, South America and Asia. The flight occurred June 27 at Castle Heliport, located at the U.S. Army’s Yuma Proving Ground in Arizona.
“This first flight represents a major milestone for GA-ASI’s newest product line designed and developed for our international allies worldwide,” said Frank W. Pace, president of Aircraft Systems. “We are now positioned to restart the Predator production line and proceed directly to full production in anticipation of new customer orders.”
During the company-funded 35-minute flight, Predator XP demonstrated its ability to launch, climb to operational altitude, complete basic airworthiness maneuvers, and land without any discrepancies, officials said. A subsequent test program will be conducted to verify Predator XP’s design, including safety of flight, automatic takeoff and landing, payload and communications testing, as well as beyond line-of-sight satellite communications control.
Hollenbeck Elected President of Lawyers Club
Patricia Hollenbeck, a partner with the Duane Morris law firm, has been elected as the 43rd president of the Lawyers Club of San Diego. Her one-year term began July 1.
A member of the organization’s board of directors since 2011, Hollenbeck recently completed her term as vice president of the Finance & Fundraising Section. She previously served as the chair of several Lawyers Club committees, including Membership and Judicial Endorsements.
Hollenbeck is a trial lawyer who represents clients in a broad range of matters before state and federal courts, as well as arbitration forums.
For the past several years, Hollenbeck has served on the steering committee of the Duane Morris Women’s Initiative, and in 2013 she received the firm’s Cheryl Blackwell Bryson Leadership Award. The award recognizes significant contributions to women in the profession, including issues regarding the professional development of women lawyers and their career advancement.
Mission Hills Man to Lead 2014-15 County Grand Jury
San Diego County has named 19 new members of the County Grand Jury, a panel that looks into complaints about government agencies, including cities, school districts and partnerships between government bodies. Robert O’Connor, a retired lawyer from Mission Hills, will lead the grand jury. The other members are from throughout the county, including six others from San Diego, and five residents from the North County cities of Carlsbad, Encinitas and Escondido, three from the East County cities of El Cajon and La Mesa, and four from the cities of Coronado, Chula Vista and Imperial Beach.
The new members were randomly drawn from 84 applicants. They will be paid $25 a day plus reimbursement for mileage. Applications are accepted in December and January.
— Times of San Diego
NASA Landing at Comic-Con with Panel on Mars Exploration
Comic-Con may be better known for science fiction than fact, but this year NASA will host a panel with moon-walking astronaut Buzz Aldrin on the agency’s plans for exploration to an asteroid and ultimately Mars.
On Thursday, July 24 at 3 p.m., which is the 45th anniversary of Apollo 11’s
return to Earth, the agency will host a panel discussion titled “NASA’s Next Giant Leap” at Comic-Con International at the San Diego Convention Center.
Apollo 11 was the first mission to land on the Moon, and Aldrin was the pilot of the lunar module.
The panel discussion marks the first time that NASA has officially participated in Comic-Con.
Moderated by actor Seth Green, the panel will include Aldrin, NASA Planetary Science Division Director Jim Green, Jet Propulsion Laboratory systems engineer Bobak Ferdowsi, and NASA astronaut Mike Fincke.
The panel will discuss the Orion multi-purpose crew vehicle and the Space Launch System rocket, which are designed to carry humans beyond low-earth orbit to asteroids and ultimately Mars.
Orion’s first flight test, called Exploration Flight Test-1, is scheduled for later this year atop a Delta IV Heavy rocket from the Cape Canaveral Air Force Station. This test will evaluate launch and high speed re-entry systems such as avionics, attitude control, parachutes and the heat shield.
— Times of San Diego
San Diego County Home Sales for June
San Diego County home sales in June totaled 3,736, up from sales of 3,654 in May but down 7.7 percent from sales of 4,048 in June of last year, according to DataQuick, a San Diego real estate information service.
The median price paid for a home in June was $450,000 compared to $440,000 in May and $416,500 in June of last year.
Southern California Totals:
DataQuick said Southern California homes sold at the slowest pace for a June in three years as investor purchases fell again and other would-be buyers continued to struggle with inventory and affordability constraints. The median price paid for a home rose to its highest level in 77 months but the single-digit gain from a year earlier was the smallest in two years.
A total of 20,654 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 5.6 percent from 19,556 sales in May, and down 4.4 percent from 21,608 sales in June last year, according to DataQuick, which is owned by Irvine-based CoreLogic, a leading global property information, analytics and data-enabled services provider.
On average, sales have increased 6.4 percent between May and June since 1988, when DataQuick’s statistics begin. Sales have fallen on a year-over-year basis for nine consecutive months. Sales during the month of June have ranged from a low of 18,032 in June 2008 to a high of 40,156 in June 2005. Last month was 23.7 percent below the June average of 27,069 sales. Sales haven’t been above the long-term average for more than eight years.
“Pent-up demand, job growth and still-low mortgage rates continue to put pressure on home prices,” said Andrew LePage, a DataQuick analyst. “But they’re climbing at a much slower pace than a year ago. In many markets price appreciation has slipped into the more sustainable single-digit range, compared with gains exceeding 20 percent this time last year. Why the drop-off? The supply of homes for sale, while still low in an historical context, is higher this year, and the decline in affordability serves as gravity for home prices. People can’t stretch with exotic and risky loans the way they could during the last housing boom.”
The median price paid for all new and resale houses and condos sold in the six-county region last month was $415,000, up 1.2 percent from $410,000 in May and up 7.8 percent from $385,000 in June 2013. While last month’s median was the highest since it was also $415,000 in January 2008, the 7.8 percent year-over-year gain was the lowest since June 2012, when the $300,000 median rose 5.3 percent.
Last month three counties — San Diego, Los Angeles and Ventura — logged single-digit, year-over-year gains in their median sale prices.
The Southland’s June median stood 17.8 percent below the peak $505,000 median in spring/summer 2007.
Foreclosure resales — homes foreclosed on in the prior 12 months — accounted for 5.3 percent of the Southland resale market last month. That was up slightly from a revised 5.0 percent the prior month and down from 9.0 percent a year earlier. In recent months the foreclosure resale rate has been the lowest since early 2007. In the current cycle, foreclosure resales hit a high of 56.7 percent in February 2009.
Short sales — transactions where the sale price fell short of what was owed on the property — made up an estimated 6.0 percent of Southland resales last month. That was down from a revised 6.4 percent the prior month and down from 14.5 percent a year earlier.
Absentee buyers — mostly investors and some second-home purchasers — bought 23.6 percent of the Southland homes sold last month. That was the lowest share since December 2010, when 23.4 percent of homes sold to absentee buyers. Last month’s 23.6 percent absentee share was down from 24.9 percent in May and down from 29.0 percent a year earlier. The peak was 32.4 percent in January 2013, while the monthly average since 2000, when the absentee data begin, is about 19 percent.
The typical monthly mortgage payment Southland buyers committed themselves to paying last month was $1,616, up from $1,602 the month before and up from $1,483 a year earlier. Adjusted for inflation, last month’s typical payment was 34.1 percent below the typical payment in the spring of 1989, the peak of the prior real estate cycle. It was 46.0 percent below the current cycle’s peak in July 2007.