From the sddt.com:
Developers and construction officials are seeing signs of what could be the next trend in San Diego’s construction: multifamily housing.
The county of San Diego reported 541 multifamily permits were pulled in February, the most in any month since 633 were pulled in April 2008.
When one adds February’s number to January’s, 836 multifamily permits have been issued so far in 2011, the most in the first two months of the year since January 2006 when 987 permits were pulled.
Tammy Harpster, chief investment officer for Taag Investment Management, said there is a “feeding frenzy” going on with developers and investment companies for land to build multifamily housing projects.
“A lot of people who lost their homes due to foreclosures or short sales, now want to rent and move back into the city,” Harpster said. “The core area is in between Interstates 5 and 805.”
Harpster said rents have been rising on the multifamily entitlements Taag Investment Management owns and in turn has raised the price of land for multifamily housing projects, saying land is going for about $1.50 to $1.75-per-square-foot.
“A lot of people who bought (single-family homes) in Santee or other areas outside of the city of San Diego and lost their home now want to relocate closer to where they work, even if they have to rent,” Harpster said. “Before people didn’t mind the long commute to work since they thought they were getting a great deal on their single-family home.”
One of the largest master planned developments in San Diego County is Civita in Mission Valley. The first phase of the 4,800 housing unit community calls for a 306-unit apartment complex and two townhome buildings totaling 200 units, but no permits have been pulled in the last two months for any of these housing units, according to Marco Sessa, senior vice president of Sudberry Properties. Sudberry is part owner and developer of Civita.
Dave Gilmore, principal at the architectural firm LPA Inc., said some developers are going off the trend of seeing vacancy rates on office space decrease.
“We have seen a lot of office space being leased up in the last month,” said Gilmore, whose company is based in San Diego’s East Village. “I think developers are seeing business expand and moving into California and believing more (multifamily) urban housing is needed, especially on the westside of San Diego.”
Gilmore could not point out a new multifamily development in the works in the county, but did say some of his clients are developing master- planned communities — with multifamily housing projects — such as the Irvine Co. in Orange County.
Jeff Bingham, chief executive officer of Bingham Construction, said he has noticed land in Mira Mesa and in Escondido being leveled off for the construction of multifamily housing projects.
“There is a wave of apartment complexes coming, because people now can’t afford those large (single-family) homes and are now downsizing,” said Bingham, who added his company has completed a few renovation projects to existing apartment complexes.