Daily Business Report-Sept. 1, 2017
Rendering of AMP&RSAND. The Casey Brown Company is developing the project, which was the former home of The San Diego Union-Tribune and will be a modern and highly amenitized work campus in Mission Valley.
‘Urban-Suburban’ Markets Offer Unique
Opportunities for Investors and Occupiers
Suburban office markets that provide an urban-like live-work-play environment are well positioned to capture strong demand from office users, according to a new report from CBRE.
Among the most common attributes of so-called “urban-suburban” submarkets are the presence of abundant retail, office and housing options, as well as employment opportunities, based on a survey of CBRE Research professionals in the 25 largest suburban markets.
Established urban-suburban submarkets have the added advantage of amenities like entertainment and recreational offerings, restaurants and grocery stores and public transportation access. Established submarkets in San Diego include UTC, Mission Valley and Carlsbad.
“Mission Valley is seeing a revitalization with increased office and residential construction, including the redevelopment of the River Walk Golf Club and Town and Country Conference Center,” said Jeff Oesterblad, vice president at CBRE in San Diego. “Development activity will continue to transform Mission Valley, which already features the live-work-play elements and is well-connected to the transit network with multiple stops throughout the area. Competing plans for the development of the former Qualcomm Stadium site will provide an urban feel and further boost demand.”
Emerging submarkets, such as Sports Arena/Point Loma, Del Mar Heights and South San Diego, are more likely to be in transition, with development, construction or renovation – including ongoing or planned public transit projects – shaping dynamics. For example, Del Mar Heights has been a premier office market with some of the highest rental rates in San Diego, but density has always been low, with shopping limited to a handful of auto-oriented centers. Notably, emerging submarkets are more likely than established submarkets to have mixed-use projects in the works. Mixed-use projects often serve as a catalyst for additional development in a particular area, spurring interest in the surrounding neighborhood. One Paseo is a massive new mixed-use project under construction that will add retail, residential and office space to the otherwise decentralized submarket. Emerging submarkets are also more likely to utilize government incentives, zoning changes or other public commitments to assist development than established submarkets.
“Steep rental rates and an increasingly limited supply of quality office space, especially in large blocks, in downtown submarkets will continue to lead more tenants to look for space in suburban markets,” said Scott Marshall, executive managing director, Advisory & Transaction Services|Investor Leasing, CBRE. “Moreover, as more millennials age and begin families, many will eventually move to the suburbs. Office locations that can provide the urban characteristics this pool of workers has grown accustomed to will be in the highest demand.”
The vacancy rate for emerging urban-suburban submarkets was 15.3 percent as of Q1 2017, compared with 13.8 percent for the established urban-suburban submarkets. Similarly, rents in emerging urban-suburban submarkets have yet to surpass the overall suburban average ($27.79 per sq. ft.) but were essentially equal at $27.46 per sq. ft. and significantly below rents in established urban-suburban submarkets ($31.90).
The amount of new office construction underway in urban-suburban submarkets is slightly elevated relative to their share of inventory. Emerging submarkets account for 22 percent of total square footage under construction in the top 25 suburban markets (compared to their 20 percent share of total inventory) and established submarkets account for 30 percent (compared to 26 percent of total inventory). Yet in certain metros, these shares are much higher, with urban-suburban submarkets accounting for 100 percent of the suburban office space under construction in Sacramento, Minneapolis/St. Paul, Kansas City and Austin.
Three San Diego Hospitals Fined
for Patient Harm Incidents
Three San Diego hospitals are among 10 across the state penalized Thursday for mistakes that severely injured, or killed, patients. The California Department of Public Health levied a total of $618,002 in penalties against the facilities, including $233,650 in financial pain for Sharp Coronado Hospital, Sharp Mary Birch Hospital for Women & Newborns and Vibra Hospital of San Diego, for errors which included an attempted suicide, a sponge left inside a patient and a fall-related death.
— San Diego Union-Tribune
Protea to Redevelop Aero Drive Property
San Diego-based Protea Aero Drive LLC has released renderings of the Aero Drive property that it intends to develop into a tech and corporate office facility. Ware Malcomb designed the project.
The AeroVault building on the property at 8875 Aero Drive was originally constructed for Bank of America in the early 1980s that reportedly held up to $1 billion in cash and coin at peak operation.
Free Professional Development Classes
Offered by San Diego Organizations
Starting Sept. 20, San Diego Employers Association and San Diego Workforce Partnership will offer more than 20 free professional development classes on topics ranging from Conducting Thorough Investigations, to Sourcing and Selection, to Avoiding Liability for New Managers. Additional classes include Pregnancy Leaves, Wage and Hour Mistakes, and Top 10 Difficult Conversations to Have with Employees.
The courses, which run through Jan. 26, 2018, will be taught by expert instructors with extensive expertise in the human resources field. To view the full list of classes and to register, visitwww.sdeahr.org and click on “Free Classes.”
Comhear Inc. Expands Senior Leadership Team
Comhear Inc., the San Diego-based technology company, announced the expansion of its leadership team with three veteran executives. The company brought on Eric Haskell as chief financial officer, Paul O’Callaghan as senior vice president of sales, and Greg Thener as regional vice president of sales. The three business professionals join Comhear on the heels of the company’s recent completion of a $12 million capital raise.
Eric Haskell brings over 30 years of senior financial experience at both public and private companies to Comhear. Prior to joining Comhear, he served as the executive vice president and chief financial officer at SunCom Wireless Holdings Inc., a digital wireless communications services provider.
Paul O’Callaghan is a seasoned executive with a record of global sales achievements as well as building and leading high performing sales organizations. Previously, O’Callaghan worked at Mobile Labs Inc. where he was vice president of global alliances and international sales operations.
Greg Thener has more than 20 years of sales experience and is well versed in both direct and alternate channel distribution. He will be responsible for sales of Comhear products and services within the United States. Prior to joining Comhear, Thener was director of enterprise and education sales in the Southern U.S. and Latin America for Panopto, a video platform provider.
Weekend’s Best Bet
U.S. Sand Sculpting Challenge
Sept. 1-4. Watch as top sculptors from all over the world compete against each other to create astonishing sand sculptures. Plus, enjoy live entertainment, free activities in the kids zone and more. $7-13. Port of San Diego’s Broadway Pier and Landing.