$400M Mixed-Use Project Breaks Ground in Downtown San Diego

Holland Partner Group, North America Sekisui House and Lowe have broken ground on West, a $400 million mixed-use development in Downtown San Diego. At 37 stories, the property will feature 270,000 square feet of office space, 19,000 square feet of retail space and 431 luxury apartments.

Carrier Johnson + CULTURE is designing the project with Holland Construction as general contractor. The office space will feature floor-to-ceiling glass windows and outdoor balconies with views and a hotel-inspired lobby. The property will also feature roof decks on the ninth floor with ocean views and green roof space. The property will be WELL Certified.

The developers have tapped JLL to handle leasing efforts for the property. Tony Russell and Richard Gonor will serve as the brokers for the office space, which can accommodate users with office needs from 25,000 square feet to 270,000 square feet. According to brokers, the property is the perfect solution in the post-pandemic world, as companies return to the office and seek modern amenities.

Office leasing in the San Diego market began to recover in the middle of last year. In the third quarter, the market posted 269,000 square feet of positive leasing activity, marking the second consecutive quarter of growth, according to a report from Colliers. Prior, San Diego had five consecutive quarters of negative absorption. The office leasing demand in the third quarter reached levels not seen since 2018 and 2019, and according to the report, it is a sign that the office market has turned a corner. The leasing activity represents true market absorption because no new projects delivered in the third quarter. Most of the positive absorption in the quarter was in the class-A market. Other metrics also showed improvement in the third quarter, with office vacancy down 32 basis points in the third quarter.

Lab space has helped to buoy the market. Last year, demand for lab space increased 280% since March 2020 and office demand surpassed pre-COVID levels, according to research from JLL. The demand is driving both leasing and investment activity in the market.