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OH MY! OTAY! - Development in South San Diego County

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I recently had the opportunity to prepare a utility demand forecast for the Otay Water District. After completing my on-line research and chatting with a few border-friendly clients, I took the occasion to spend a day at the border.

It is really pretty amazing. What was once a no man’s land has become everyman’s land.

Expanding Roads to and From Mexico

First, the Feds have completed their $750 million San Ysidro port of entry expansion. I don’t know how they spend three quarter of a billion dollars on the crossover, but the Feds claim it will make it easier for the 35,000,000 persons and 9,000,000 vehicles coming north each year.

Next you come to the CrossBorder Xpress, Sam Zell’s miracle access to the Tijuana Airport. Last year 2,900,000 persons took advantage of that short-cut. Interestingly, few of the folks taking advantage of the CBX are San Diegans. Most come from north of the San Diego county border.

Otay Mesa's Port of Entry is also getting $122 million for expanding and modernizing the crossing. Last year, almost 1,000,000 trucks crossed that eastern border bringing in and out $46 billion of goods. That’s a 50% increase in the last ten years. 

And there is progress being made on completion of the SR-11 highway to the border, which in a few years will become Otay Mesa's second border crossing, called Otay Mesa East POE.

Proposed Otay Mesa East Port of Entry & State Route 11 Completion to the Border

Housing & Industrial Hotspots

If you travel down in Otay Mesa, you will see big dirt. Lots of it being moved as several major developers prepare for the next round of big-time real estate development & construction.

Traveling east from San Ysidro along 905, all that vacant land you see is about to be occupied. Pardee has plans to add 5,200 housing units; Colrich will add 1,000+ units and a few others intend to add another 2,000 units. Fun on the 905.

Of course, the big announcement is Amazon’s ambitious 3,400,000 square foot four-story distribution facility sitting on 65 acres east of the 125 Tollway. I don’t exactly know how many jobs will be created, but they will have 1,800 parking spaces, if that’s a clue. And I don’t suspect they will operate only one shift.

One can only imagine the number of firms that want to or need to be in the vicinity of Amazon to facilitate their movement of goods.

Two other major projects are underway, as well.

The first is Majestic/Sunroad’s mixed-use master planned community at the 125 and Otay Lakes Road. That project is starting out with 277,000 square feet of industrial space (now under construction) but will eventually total 3,000+ housing units, 765,000 square feet of industrial space and 75,000 square feet of retail space.

The other monster project is Otay Crossings, a 311-acre industrial park, the first phase of which is now being graded. Ultimately, Otay Crossings will have 3,000,000 square feet of industrial space.

Currently, there are 700,000 square feet of industrial space under construction which will push the year-end total industrial space in Otay Mesa to 26,000,000.

Also underway east of the 125 is a 40-acre Sheriff’s Vehicle Operations Course. Sort of a Daytona Speedway for law enforcement.

An interesting acquisition: Salvation Army has acquired space in the Brown Field Tech Center to build a 130-bed facility as well as a warehouse/distribution center.

Oh, yes, there is Brown Field airport. It is undergoing a major upgrading. The latest plans call for 87 new hangars and two hotels. And, inevitably, there will be additional commercial and industrial space.

Excerpt of San Diego Brown Field Airport's future layout plans - June 2019

Take a ride along the 905 one day. You'll find there's attractive places and activity happening south of Interstate 8.


Alan Nevin is the Director of Market Research & Valuations at Xpera Group. He can be reached at anevin@xperagroup.com.


Topics: Economics, Real Estate Development, San Diego, Market Research, California, Land Development

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