SAN DIEGO-Due to strong demand and limited supply, new multifamily product in the San Diego market is absorbed quickly, according to Wood Partners director Brian Hansen, who oversees Southern California development projects. This week, Wood Partners completed the sale of Domain by Alta San Diego to Essex Property Trust Inc. for $121 million in an all-cash transaction, GlobeSt.com reported in an earlier story.

“Between late 2012 and 2013, we have seen rent growth over the last year that previously the market hadn't really experienced,” Hansen tells GlobeSt.com. “All of the new product, including Domain and a few others, were absorbed pretty quickly. New product was so rare after the recession that [the market] has responded to it very well.”

Due to this limited supply, the property is positioned to generate significant economic growth. Based on a formula developed by the National Association of Home Builders, the property is estimated to contribute $33 million to the San Diego economy each year. “During construction, we definitely created a lot of temporary jobs during a time when that industry was severely hurting,” Hansen explains; adding, “we have taken a piece of land and created a $100 million plus asset, which is a big tax-revenue boost to the city.” According to that same formula, the tax revenue boost is $12.7 million annually.