SAN DIEGO—The San Diego economy continues to drive job growth and is overall positive for commercial real estate especially residential with the highest overall rent gains occurring in the Kearny Mesa and coastal submarkets. Those thoughts are according to Yardi's Doug Ressler.
Yardi's latest market outlook points out that although the city's housing shortage issues are ongoing, the market remains a more affordable living alternative to Los Angeles and San Francisco, especially for young, highly skilled professionals. “The metro is adding jobs across the board as its economy continues to diversify, with education and health services leading growth.”
Some of the strongest renter-by-necessity rent growth is inland in Sweetwater (8.9%), Lemon Grove (7.6%) and North San Diego (6.7%). And Central San Diego has become saturated to lack of available land for construction plus Central San Diego has and will be receiving the largest stock of new supply (3,797 units 2018), he says.
He tells GlobeSt.com that stagnant median income and lower hourly and wage projections will drive renters to seek opportunities in the Northern part of the county and Inland, and when asked if there were enough units to meet multifamily demand, the short answer, he says, is no.
When asked if developers are working to provide units in those areas to satisfy that demand, he said that the data isn't supported by current construction starts to meet demand in those areas, noting that a current NMHC study indicates that 73,000 units are required in San Diego by 2030.
As for whether or not income trends are running counter to what's happening nationwide, Ressler tells GlobeSt.com that recent national median household income growth per census is growing at 3.95% versus San Diego at 0.11%.
Lastly, when asked what has driven rent gains in the Kearny Mesa and coastal regions of the county, he says that commercial office and tech center employment has been significant in this submarket.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
