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Development in Quiet Neighborhoods Gives Glimpse of Steady Demand

Big Deals, Projects Bubbling in Poway, Scripps Ranch

Photo: CoStar - Sudberry Properties recently broke ground on The Hub at Scripps Ranch with plans to include apartments and retail. Illustration: Sudberry Properties

A string of prominent retail and mixed-use deals during the past two weeks have hit a normally low-profile commercial area in San Diego off Interstate-15, which includes the northeastern neighborhood of Scripps Ranch and the adjacent city of Poway, in a sign of growing interest in the area as U.S. economic growth keeps chugging along.


Some of the activity stems from developers looking to fill untapped or underserved neighborhoods within the larger San Diego region.


But the interest is spilling beyond San Diego. The U.S. economic expansion is poised to reach a record stretch next month, showing that quiet neighborhoods across the country are getting developed, a sign builders are confident in growth over the next 18 months.

Among them, Sudberry Properties announced the start of construction on The Hub at Scripps Ranch, a 9.5-acre project at 9850 Carroll Canyon Road, which is slated to include 260 luxury apartments and 10,700 square feet of retail and restaurant space.


“Sudberry Properties has been planning The Hub at Scripps Ranch for several years and has collaborated with local leaders to create a vibrant residential and commercial center with much-needed workforce housing and restaurants,” said company President Colton Sudberry in a statement.


The Hub is scheduled to open in phases, with the first apartments and commercial spaces to be available for occupancy in the fourth quarter of 2020. A separate statement from brokerage Holliday Fenoglio Fowler (HFF) LP noted that the firm had arranged financing for The Hub through a commercial bank, though details on project costs and expected apartment rents were not disclosed by HFF or the developer.


Bordering Scripps Ranch on its north side is the city of Poway, where HFF said it brokered the separate sale of the 10-acre, 109,455-square-foot Poway Crossings retail center. Sterling Organization bought the property at 12622-12654 Poway Road from seller Greenstreet Real Estate Partners LP for $27 million, the brokerage said.


Nearby in Poway, lender Parkview Financial announced it has provided a $31.85 million construction loan to San Diego-based Poway Property LP for Outpost, the developer’s previously announced mixed-use project at 13247 Poway Road, set for completion next year. That project includes 53 apartments with ground floor retail, which has been fully preleased to Crunch Fitness and restaurant operator Three Local Brothers.


Poway is also where developer Ryan Cos. and investment partner DWS Group recently broke ground on Vantage Point, a 533,950-square-foot logistics complex described by brokers at Kidder Mathews as the largest speculative industrial development of its kind undertaken in the past two decades in that particular area of suburban San Diego.


The latest CoStar data shows Poway’s retail vacancy rate at 3.7%, slightly above the San Diego regional rate of 3.4%. Poway’s average retail rent grew 0.7% in the past year to $2.43, basically on par with the regional growth rate 0.3% to $2.44 per square foot, according to CoStar Market Analytics.


Scripps Ranch has a 3.9% retail vacancy rate, and it’s part of a freeway-adjacent cluster of neighborhoods, including Miramar and Mira Mesa on the opposite site of I-15, where CoStar reports the average retail rent has declined 0.7% in the past year, to $2.63 per square foot.


Article by: Costar


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