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Thursday, Mar 28, 2024
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Mayor Vows Changes in Real Estate Portfolio

San Diego Mayor Jerry Sanders , standing before “the infamous La Jolla Rat House” on March 2 , declared a call to arms to fix what he said has been serious mismanagement of the city’s real estate assets.

Within the next month, said Sanders, the city will hire a “top-tier professional” to help complete the overhaul of the city’s Real Estate Assets Department, known as READ; hire an experienced consulting firm that will help the city devise a new system for gauging the amount and value of its real estate assets; and determine how much the city collects in rent on leased properties.

Sanders also proclaimed a “timeout” on any new leases, long-term lease renewals, and sale of city land during the overhaul.

The city also plans to:

– Establish policies for new leases and lease extensions to get the most value for taxpayers.

– Review other local government models, analyzing “best practices” in the real estate industry.

– Re-examine current city leases to ensure that the city is collecting market rates to boost revenue for the city.

Some real estate data released by Sanders’ office:

– The city owns 80,000 acres, making it one of the county’s major landowners.

– READ administers more than 700 leases, some dating back more than 50 years.

– Twelve READ property agents oversee all city-owned land.

– Clients include many city departments, including police, fire, park and recreation, water and libraries.

– The city expects to collect $63 million in fiscal 2006 from leases.

– READ provides real estate valuation, relocation, acquisition and disposition services.

Jim Waring, a real estate attorney and the city’s new deputy chief operating officer for Land Use and Economic Development, will be in charge of overhauling READ.

The Rat House , billed by Sanders as “the poster child” for the city’s mismanagement , is a vacant, deteriorating, once-upscale home at 5635 Desert View Drive off Soledad Mountain Road in La Jolla.

The city, which has owned the property since 1992, bought the house as part of a settlement in a lawsuit in which it was the defendant. The original owners of the home blamed the city for negligently building and maintaining the street and other public improvements near the house, according to Sanders’ office.

Unstable and a magnet for rats, the house was scheduled for “destruction” following the news conference. The city has hired Whillock Contracting, Inc., in El Cajon, for the job, and plans to recycle all the lumber, steel, concrete and copper piping. The work, which is expected to take 45 days, will cost $90,595. The future of the property is yet to be determined.

, Pat Broderick

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