Mulhern: Geographically, La Mesa is the first market you come to in East County when you leave Mission Valley. It's an infill market that's very close in, with great proximity to Mission Valley and obviously, all the employment centers in Mission Valley going up into Kearny Mesa and that area. It's on the trolley line, which is a plus for getting into Mission Valley and other locations. It's also a very established area. Home prices and values in most of East County are lower than in many other areas of San Diego, but that's not the case with La Mesa—it's the most upscale in terms of value and home prices. It's not like going out to El Cajon or Lakeside. It's also an older market; only a handful of deals have been built out there in the last 10 years, so there's clearly a lot of demand based on how the Quarry leased up. SETA is another larger deal there that leased up quickly. There's a lot of market demand out there.

GlobeSt.com: What types of multifamily properties are needed in this market?

Mulhern: The Quarry was something unique. If you look at that deal, it was new construction, the interiors of the units are super nice, the finish levels are nice, and the floor plans are good. There's in-unit washer dryers, and the units are laid out like condos, yet the price points are reasonable. The project designers didn't spend a lot of money on fancy amenities. There's a building with a BBQ area outside, covered parking, not a big pool, a gym and a clubhouse. That's what drives a lot of cost that the developer has, and in turn, rents go higher. The county needs more new, quality rentals that aren't necessarily the triple-As. You don't have to get top-of-the-market rents. Most of what has been built in the county has been luxury, but there's a ton of demand for stuff that's nice, but not AAA.

Also, with La Mesa, the original stock built in the '60s, '70s and '80s has a lot more one-bedrooms than other types. La Mesa, for whatever reason, seemed to need a lot more one-bedrooms at that time, so it probably needs more two-bedroom units that can accommodate families. There's definitely a shortage of two-bedrooms in the overall market.

GlobeSt.com: How does La Mesa compare to other submarkets in San Diego for apartment development and investment?

Mulhern: Good parts of Chula Vista probably compare on equal footing to La Mesa, as does Tierrasanta, although there's not a lot of apartment stock there, and some of the better areas of Clairemont, which is very similar to La Mesa as well. Those areas are mixed, where you've got a good healthy combo of blue and white-collar jobs, they're not super-affluent areas, but they're not impoverished by any stretch of the imagination. They're just good, solid B markets. Investors who are drawn to La Mesa are typically local players because it's not a high-profile market, so not a lot of international or national investors know it. But the local players that really understand the submarkets really like La Mesa because they recognize that it's a good performer with high occupancy, a good resident profile and always performed at or above the level of the rest of the county.

GlobeSt.com: What else should our readers know about La Mesa as an apartment market or transaction?

Mulhern: La Mesa is going through an evolution now. The area downtown south of I-8, between I-8 and 94 off Spring Street, is being redeveloped into a cool, walkable downtown area with restaurants and shops, and we're seeing this in all of these suburban markets: somewhat of an urbanization in their downtowns. The Quarry is a three- to four-minute ride to Downtown La Mesa, so it's very accessible to Downtown and shopping, and that was a big pull for residents living there. People like that it's a quick Uber ride into Downtown. Even though they're living in the suburbs, they want to still have that urban feeling.

The other thing that's somewhat of a driver for La Mesa, particularly for the western part of La Mesa, is its proximity to SDSU. A lot of students, particularly juniors and seniors who live off campus, end up living in Mission Valley or La Mesa because of the proximity, and also, if they live close to the trolley, they can get to school on the trolley. It takes them right into the student center at SDSU.

SAN DIEGO—Top-of-the-market rents in class-A buildings with all the amenities are great, but the market really needs good, solid workforce housing for affordable rents in most markets, CBRE's multifamily expert Kevin Mulhern tells GlobeSt.com. Mulhern and CBRE's Rachel Parsons recently represented San Diego-based seller Silvergate Development in the sale of the Quarry Apartment Homes at 4330 Palm Ave. in La Mesa, CA, for $17 million to an affiliate of John Jaffe Company LP.

The 60-unit luxury apartment community is made up of three, three story buildings and was built in May 2015. The property has 43,765 square feet of residential space and is situated on 1.59 acres. The Quarry features one and two-bedroom floor plans with an average unit size of 717 square feet. The apartment features fully equipped kitchens with granite countertops, espresso cabinetry, and stainless GE appliance packages including electric ranges, microwaves, dishwashers and refrigerators. Select homes include kitchen islands or breakfast bars. All homes feature hard surface plank vinyl flooring, oversized windows/sliders, central air and full-sized stacked washers/dryers.

We spoke exclusively with Mulhern about the La Mesa multifamily submarket and what types of apartment communities are needed in this market.

GlobeSt.com: What makes the La Mesa submarket ideal for multifamily development and investment?

Mulhern: Geographically, La Mesa is the first market you come to in East County when you leave Mission Valley. It's an infill market that's very close in, with great proximity to Mission Valley and obviously, all the employment centers in Mission Valley going up into Kearny Mesa and that area. It's on the trolley line, which is a plus for getting into Mission Valley and other locations. It's also a very established area. Home prices and values in most of East County are lower than in many other areas of San Diego, but that's not the case with La Mesa—it's the most upscale in terms of value and home prices. It's not like going out to El Cajon or Lakeside. It's also an older market; only a handful of deals have been built out there in the last 10 years, so there's clearly a lot of demand based on how the Quarry leased up. SETA is another larger deal there that leased up quickly. There's a lot of market demand out there.

GlobeSt.com: What types of multifamily properties are needed in this market?

Mulhern: The Quarry was something unique. If you look at that deal, it was new construction, the interiors of the units are super nice, the finish levels are nice, and the floor plans are good. There's in-unit washer dryers, and the units are laid out like condos, yet the price points are reasonable. The project designers didn't spend a lot of money on fancy amenities. There's a building with a BBQ area outside, covered parking, not a big pool, a gym and a clubhouse. That's what drives a lot of cost that the developer has, and in turn, rents go higher. The county needs more new, quality rentals that aren't necessarily the triple-As. You don't have to get top-of-the-market rents. Most of what has been built in the county has been luxury, but there's a ton of demand for stuff that's nice, but not AAA.

Also, with La Mesa, the original stock built in the '60s, '70s and '80s has a lot more one-bedrooms than other types. La Mesa, for whatever reason, seemed to need a lot more one-bedrooms at that time, so it probably needs more two-bedroom units that can accommodate families. There's definitely a shortage of two-bedrooms in the overall market.

GlobeSt.com: How does La Mesa compare to other submarkets in San Diego for apartment development and investment?

Mulhern: Good parts of Chula Vista probably compare on equal footing to La Mesa, as does Tierrasanta, although there's not a lot of apartment stock there, and some of the better areas of Clairemont, which is very similar to La Mesa as well. Those areas are mixed, where you've got a good healthy combo of blue and white-collar jobs, they're not super-affluent areas, but they're not impoverished by any stretch of the imagination. They're just good, solid B markets. Investors who are drawn to La Mesa are typically local players because it's not a high-profile market, so not a lot of international or national investors know it. But the local players that really understand the submarkets really like La Mesa because they recognize that it's a good performer with high occupancy, a good resident profile and always performed at or above the level of the rest of the county.

GlobeSt.com: What else should our readers know about La Mesa as an apartment market or transaction?

Mulhern: La Mesa is going through an evolution now. The area downtown south of I-8, between I-8 and 94 off Spring Street, is being redeveloped into a cool, walkable downtown area with restaurants and shops, and we're seeing this in all of these suburban markets: somewhat of an urbanization in their downtowns. The Quarry is a three- to four-minute ride to Downtown La Mesa, so it's very accessible to Downtown and shopping, and that was a big pull for residents living there. People like that it's a quick Uber ride into Downtown. Even though they're living in the suburbs, they want to still have that urban feeling.

The other thing that's somewhat of a driver for La Mesa, particularly for the western part of La Mesa, is its proximity to SDSU. A lot of students, particularly juniors and seniors who live off campus, end up living in Mission Valley or La Mesa because of the proximity, and also, if they live close to the trolley, they can get to school on the trolley. It takes them right into the student center at SDSU.