Life Sciences in Carlsbad

Carlsbad’s high quality of life and rich pool of skilled workers are attracting cutting-edge life sciences companies from other industry hubs.

Carlsbad is an important part of the San Diego region’s top life sciences cluster, said Joseph Jackson, co-founder of Bio, Tech and Beyond, a science and technology incubator that leases lab space to a variety of startup tenants.

“It is one of the better managed cities in the region,” Jackson said. “That is why it keeps attracting blue chip and innovation companies.”

The city has worked hard to make Carlsbad a welcoming place for life science companies and the high-paying jobs they create, said Jackson, who came to Carlsbad from Silicon Valley in 2013. The city leased Jackson a 6,000-square-foot building on Faraday Avenue to serve as a start-up incubator.

Since then, tenants at Bio, Tech and Beyond have created more than 200 new jobs, Jackson said. The incubator has helped make Carlsbad one of the pillars of the San Diego region’s life sciences industry.

A new biotech company

One of the new arrivals to Carlsbad’s life sciences community is Lineage Cell Therapeutics, a clinical-stage biotechnology company that develops novel cellular therapies.

The company manufactures retina cells to help people with macular degeneration, said CEO Brian Culley. It also manufactures cells to promote recoveries from debilitating spinal cord injuries.

It was Culley who pushed for the move to Carlsbad as a cost-saving measure. A North San Diego County resident, he had no desire to relocate. The affordability of leased space and the close proximity to other top life science companies enabled him to make a compelling case for moving to Carlsbad.

Lineage Cell Therapeutics’ Salk Avenue office currently houses 10 employees. It relocated from Alameda in the San Francisco Bay Area, although the company continues to employ people there as well as in Israel, Culley said. He described the Carlsbad office as “the heart and brain” of the company.

“It was really easy to find an ideal space for our needs,” he said.

Another bonus was finding that labor costs in Carlsbad are much more affordable than in the pricey San Francisco Bay Area. Culley said his Carlsbad employees appreciate the lighter traffic and the local work-life balance. A soccer player, he said he already has connected with other local enthusiasts. One of the places he likes to play is Aviara Community Park.

“It’s a delightful community,” he said. “It provides everything you need.”

The power of microchips

In a garage in South Carlsbad, Ana and Octavian Florescu have started a company that seeks to use the power of microchips to run analytical blood tests.

In Diagnostics is housed in their garage, but the couple also leases a lab bench from Bio, Tech and Beyond to have access to additional equipment. Their goal is to develop quick and inexpensive tests for monitoring patient wellness. The couple has raised $3 million to bring their technology to market. Their prototype will start with veterinary tests.

Octavian is a former microchip designer for Qualcomm who earned his Ph.D. from UC Berkeley. He and Ana launched their business last year, after moving to Carlsbad from the San Francisco Bay Area.

“We chose Carlsbad specifically because the work-life balance seems to be really good,” Octavian said. “We had a baby in May of 2018 and our second son two weeks ago. Carlsbad is one of the most family-friendly places we have seen.”

The couple enjoys the coastal lifestyle – Octavian is a surfer and likes the convenience of living a short drive from the beach.

Now preparing to expand their business, the couple plans to lease 5,300 square feet of space near McClellan-Palomar Airport, beginning in 2020. They also plan to begin hiring between five and 10 people.

“We’re excited to grow our team and look forward to connecting with local talent,” Ana said. “We’re also very interested in connecting with local veterinarians interested in testing out our prototype.”

The collaborative nature of this thriving coastal community is yet another attraction to life science companies. As the region continues to thrive as a booming innovation center, Carlsbad will contribute to the ecosystem’s growth by attracting and growing both large and small cutting-edge companies.

Bye Bye Smokestack

Carlsbad has been put on notice – the NRG smokestack is coming down!

The big question is what will go up in its place, and it should be the next big fight among locals.  It’s probably a toss up between a mixed-use hotel development and a public park – but not a Nordstrom!

Will the removal of the ugly and dangerous-looking smokestack improve nearby home values?

There are two neighborhoods that could benefit – Spyglass/Heron Bay and Terramar:

The Spyglass/Heron Bay neighborhoods up on the hill have had the smokestack blocking their view since the beginning, and it would be a welcome relief for those homeowners to see it go.  When I was trying to sell the former model, the view of the ‘stack was the #1 complaint, and we never did sell the house.

This is what it looked like – it does spoil the sunset view, doesn’t it?

The other community affected is Terramar, which is across the street from the plant and has been there just about as long – both date back to the 1950s.

When I’ve had listings in Terramar, there were always comments at open houses about the ugly factor, and concerns that pollutants were being released that would kill people.  But because Terramar is ocean-close, there were always enough beachlovers who were willing to overlook any negativity about the plant.

Terramar has been under-priced for a few years now, primarily due to the lack of turnover and off-market sales.  The last sale on El Arbol was only $1,104,000 for 1,644sf on a 7,500sf lot, which if it were further north in the Garfield area it would have garnered at least 10% more.  The east side of El Arbol does get a direct shot of railroad, but the RR goes by Garfield too.

I think both areas could see a +10% benefit in nearby home values once the smokestack is gone, just for the happy factor – it will be a relief to see it go, and be one less thing for buyers to worry about!

Carlsbad’s Low-Income Housing

The City of Carlsbad needs to build 2,094 very-low and low-income homes over the next ten years.  Hope they get busy on approving those granny flats!

CARLSBAD — Housing is arguably the most pressing issue in the state.

As such, every eight years the state determines the number of housing units, known as the Regional Housing Needs Assessment (RHNA), and distributes those totals to each county. From there, the county breaks down the total for each jurisdiction.

In San Diego County, the region was mandated to 171,685 new units for the 2021-29 cycle, according to the California Housing and Community Development Department (HCD). The San Diego Association of Governments presented the numbers during its July 26 board meeting.

For Carlsbad, it means 3,873 new units must be constructed by the deadline. The council also approved a letter to SANDAG in support of the new methodology during its Aug. 20 meeting.

“Those comments will be considered by the SANDAG board on Sept. 6,” said Debbie Fountain, Carlsbad director of community and economic development. “We did prepare the letter … and is recommending support for that methodology.”

The goal is to increase the housing supply, as California is suffering from a housing shortage. According to the state methodology, 65% of RHNA is distributed to each municipality’s relative to its share of transit stations and stops and 35% is based on the share of jobs.

Carlsbad has no major stops per the methodology, but is the region’s third largest employer at 4.76%. And since Carlsbad has a higher average income than most of the county, more affordable housing units are required.

However, the city’s RHNA allotment decreased by 1,126 units compared to the last cycle.

The proposed methodology requires the city to construct 1,310 very-low income housing, 784 low-income, 750 moderate and 1,029 above-moderate units.

The city’s very-low income housing increased by 398 units over the previous cycle, while moderate and above-moderate units decreased by 312 and 1,303, respectively. The county saw an increase of 9,695 units compared to the fifth cycle.

“We also wanted to get some acknowledgement of the great work Carlsbad has been doing for providing low-income housing,” Fountain added.

Councilwoman Cori Schumacher asked Fountain to provide clarification for the public between the fifth and sixth assessments. Fountain said if approved by SANDAG, the city would be responsible for more very low- and low-income units in the sixth cycle compared to the fifth.

Schumacher said the focus this time around is on jobs, while Fountain added the state set specific standards, such as housing being concentrated around job and transit centers.

“It’s a 65-35 split,” Fountain added. “They looked at the jobs-housing balance. They came down to this more data-driven formula.”

One change the city will face is addressing its density requirements under the Housing Element, Fountain said. As such, she said the city will struggle “a lot” with its Growth Management Plan due to the new housing requirements and methodology.

The city’s letter supports the methodology, but also states the city has made significant strides over the past 25 years due to its Inclusionary Housing Ordinance.

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