By: Gary London

As Published in the San Diego Business Journal, February 11, 2013

A heart is about to be transplanted into San Diego’s Carmel Valley, a neighborhood where community members and planning commissioners all agree that none currently exists.

On the 23 acre vacant southwest corner of Del Mar Heights Road and El Camino Real, the most fascinating and progressive real estate development in years has begun its journey through the entitlement process. The project, One Paseo, will feature a promenade to stroll around an all-in-one center offering a wide range of retailing and leisure/entertainment components all shared with homes and offices.

The Elkus Manfredi designed project (the same architect responsible for the award-winning The Grove in LA., Americana Brand in Glendale and Civita in San Diego’s Mission Valley) is proposed by the landowner, Kilroy Realty Corp., one of the West Coast’s largest real estate asset owners and developers. Kilroy’s presence already in Carmel Valley includes its holding of 1.25 million square feet housing an estimated 34 companies, 2,300 employees, mostly in professional services and technology sectors.

Actually, Kilroy purchased the property in 2007 to do exactly that: build another 500,000-square-foot office project, fully in compliance with the zoning, and consistent with market needs as well as their own strategic purpose.

Instead, Kilroy assembled the design team to create the transformative One Paseo, a proposed 1.4 million-square-foot multiple-use environment.

‘City of Villages’ Strategy

It is the epitome of mixed-use, smart growth and a premier example of the City of San Diego’s avowed “City of Villages” planning policy to “…encourage more densely populated neighborhood cores that are developed in a thoughtful manner by enhancing the community and combining housing, jobs, services and civic uses in communities.”

It adds no impact not already accounted for in the community plan:

The recently revised project includes 470,000 square feet of office space, less than already zoned. As such, there will be fewer peak hour auto trips than already reserved in the community plan. Almost 50 percent of the employees in these offices will already live in Carmel Valley, as they do in the other offices in the vicinity. Some residents will actually be able to walk to work.

It proposes 608 residential apartment units, most above the retail space. Carmel Valley is at build out after over 30 years of development, yet its community plan still provides for 500 more residential units that cannot be built on property that instead was dedicated to a school and library. While this is a net increase of 108 units, do these additional units cause some sort of impact? Perhaps, but consider that these people no longer are commuting into Carmel Valley for work.

If ever there was a socioeconomically homogenous community, Carmel Valley is it. Most of its households are upper middle-class families. The spectrum of other demographics — young “Gen Y” adults, older seniors and “move down” aging baby boomers — have been mostly shut out. Their housing needs currently must be accommodated elsewhere. One Paseo is an opportunity to welcome back young adults raised here (but who could not otherwise afford to stay) or seniors desirous of staying here as their needs change.

This issue of density and housing is actually an economic issue. If our region is to grow and prosper economically, we must provide the right kind of housing, in the right locations, and encourage the amenities and lifestyles now demanded by households.

My firm, The London Group Realty Advisors, conducted a market study on the retail element of this project for Kilroy.

The 198,000-square-foot retail element will be most impactful, but in a good way, and it is one-third smaller in size than the Del Mar Highlands center across the street. Not only does it contemporize the retail offerings now available to this community, but it will actually forestall the need of over half of its residents to travel elsewhere to do their shopping.

Traffic studies aside — and there are lots of them completed by competent traffic engineers — it is intuitively logical to assume that the autos (and persons in them) are already traveling to and past this intersection most every day. I don’t see an appreciable net increase in traffic coming from the retail at One Paseo.

Yet, there is extreme pushback at a level I have seldom seen before in the many decades I have observed development and urban planning. I will offer my summation in part II of this column next week.