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REAL ESTATE: Panel Already Looking Past Current Recession

Panel Already Looking Past Current Recession

‘Finest’ Awards Handed Out to Industrial and Office Properties

Mandy Jackson

The recession is expected to be quick for San Diego County, compared with other parts of the country.

Still, planners and analysts say many issues need to be addressed for the area to prosper in the future.

Julie Meier Wright, president and CEO of the San Diego Regional Economic Development Corp., Rocky Tarantello, president of Newport Beach-based Tarantello & Associates, and Art Laffer, founder and chairman of Laffer Associates of San Diego, were speakers at a Dec. 7 economic forecast event hosted by the San Diego chapter of the Institute of Real Estate Management.

Wright said there is no more important issue to San Diego than expanding the Lindbergh Field in order to take advantage of cargo shipping opportunities. She said not expanding the airport is costing San Diego billions of dollars in investment.

The EDC expects to release a study regarding possible locations for a regional technology park soon. Wright said it is important to nurture the software, biotech, communications, and computer electronics and manufacturing industries because they are among the fastest-growing industries in the region.

“We have 50 drugs in clinical trials. We will have a production boom,” Wright said.

Those companies in particular need to be nurtured in order to keep their production operations in the county.

Except for the technology sector, Tarantello said there are no major imbalances that need to be corrected. There is no major commercial real estate overbuilding.

“There is no need to delay construction for very long,” he said.

Tarantello estimated the recession will end by mid-2002. The effect of the terrorist events of Sept. 11 accelerated the recession that had started in March.

The California recession will be more modest than the U.S. recession, even better for Southern California and better yet for San Diego and Orange counties, Tarantello said. However, if there are any more major terrorist events in the United States, he said, “all bets are off.”

Laffer’s crystal ball is a little cloudier in regards to the recession in California, partly because of the state’s major budget deficit and the continuing energy crisis.

“In California, you have to worry about how politicians respond to the budget crisis,” Laffer said.

Tarantello said interest rates will begin to edge back up for both commercial/industrial developers and homebuyers.

“Cheap, easy money is over,” he said. “There will be less supply of capital and more demand.”

Baby boomers are looking for investments that perform better than a bond, so real estate investment trusts and well-located, quality properties will be more attractive to them, Tarantello estimated.

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Finest Awards: The San Diego chapter of the National Association of Industrial and Office Properties recently presented local properties and real estate professionals with its “Finest” awards.

The awards went to:

– The Westridge office building for best Class A office project.

– Nokia Products Creation Center for best build-to-suit office project and best interiors project.

– Callaway Golf for best build-to-suit industrial project.

– Bridgepointe Corporate Center for best flex office/research and development project.

– Legacy Stowe Business Center in Poway for best industrial/manufacturing project.

– Developer of the year, McMillin Commercial Group, one of the San Diego-based Corky McMillin Cos.

– Broker of the year, Chris Pascale, senior vice president in industrial sales and leasing in San Diego for Los Angeles-based CB Richard Ellis.

– Architect of the year, Dennie Smith, founder of San Diego-based Smith Consulting Architects.

– Contractor of the year, San Diego-based Bycor General Contractors.

– Member of the year, Jeff Burges, chief operating officer for Yale Properties USA in San Diego.

– Jim Moxham, vice president at Irvine-based Lennar Partners Inc., who received the Mickey Carhart Lifetime Achievement Award.

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Senior Care Opens: Hyatt Corp. recently opened a $21 million assisted living residence and care center next to its existing residential property.

The 73,000-square-foot facility, which includes a 23-suite memory support and Alzheimer’s care facility opened Dec. 6 next to the 5-year-old La Jolla Village Towers, a 20-story, 232-room independent living facility on Costa Verde Boulevard.

The new building also includes 32 private and 14 semi-private skilled nursing suites on the second and third floors. The fourth and fifth floors have 36 assisted living apartments.

La Jolla Village Towers was developed by Classic Residence by Hyatt, a national upscale senior housing owner and developer, and an affiliate of Chicago-based Hyatt Corp.

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Neighborly Agreement: The San Diego Chinese Historical Museum in the Gaslamp District is expanding across the street to Pacific Terrace, a 57-unit condominium project being developed by San Diego-based Intracorp.

The museum will lease all 2,248 square feet of retail space in the project, which was designed with an Asian influence to blend in with the existing museum at 404 Third Ave. Pacific Terrace is expected to open in the spring of 2003.

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Best Bathroom: Leslie Cohen, owner of Leslie Cohen Design in Encinitas, received an honorable mention in the National Association of Kitchen and Bath Association’s 2001 Design Competition. The bathroom design for a private residence in San Diego included his and her vanities, a large shower, a hydro-thermo massage tub and a lot of closet space.

Send residential and commercial real estate news to Jackson via fax at (858) 571-3628 or via e-mail at

mjackson@sdbj.com.

Jackson can be reached at (858) 277-6359, Ext. 114.

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