San Diego Needs A Pro-Housing Constituency

 — Published by GlobeSt.com, June 16, 2016, by CARRIE ROSSENFELD. Republished by Lilac Hills Ranch, June 23, 2016.

 




London: “Policymakers hear a constituency for people who don’t want housing or don’t see the housing crisis as their crisis because they already have their house. We need to reframe the conversation.”

SAN DIEGO—Current housing constituencies in San Diego are against development, but keeping our current course will throw San Diego into economic crisis, the London Group Realty Advisors principal Gary London tells GlobeSt.com. London recently gave the presentation “Setting the Table: The Housing Crisis in Perspective; Facts and Figures” at the Housing Affordability Conference: Economic Impact and Practical Solutions, hosted by the Burnham-Moores Center for Real Estate at the University San Diego School of Business. The conference was part of the Breakfast at the BMC lecture series and was the first of two parts that laid out the problems with San Diego’s current housing situation; the second part will take place in the fall and present solutions.

The conference consisted of three sections. First was London’s presentation of empirical data. Then came the economic response—moderated by Jerry Sanders from the San Diego Regional Chamber of Commerce and former mayor of San Diego—which included panelists Mark Cafferty, president and CEO, Economic Development Corp.; Marney Cox, chief economist, San Diego Association of Governments; Lynn Reaser, chief economist, Point Loma Nazarene University; and Deborah Ruane ’14 MSEL, SVP, San Diego Housing Commission. The third section of the conference was a policy response panel, moderated by David Graham, deputy COO, City of San Diego, which included speakers Paul Borden, president and CEO, HomeFed Corp.; Ann Moore ’84 JD, partner, Norton Moore and Adams; Jeff Murphy, planning director, City of San Diego; and Mark Wardlaw, director, County of San Diego Department of Planning and Development Services.

We spoke exclusively with London after the event to get the takeaways and what to expect next.

GlobeSt.com: What was the outcome of the Summer Housing Affordability Conference?

London: There’s a call for action that as a land-use and economics community, we need to create a constituency for housing issues. And that’s the problem right now. Policymakers hear a constituency for people who don’t want housing or don’t see the housing crisis as their crisis because they already have their house. We need to reframe the conversation. What I and the other speakers at the conference did was to revisit the economic implications of the housing crisis, and we came to the conclusion that it isn’t just about the housing crisis, but also the economic implications of the housing crisis. We’re sowing the seeds for economic crisis in this county, and this needs to be of concern whether you own a home right now or not. We were able to show that there’s not just an imbalance of supply and demand in the regional housing market, but more of a maldistribution, a disconnect between where available lots are—most in South County—and where the available jobs are and are going to be—mostly in North County.

There’s another disconnect, which is the projected maldistribution of housing type being forecasted by SANDAG. The organization says eight out of 10 homes in the next 30 years will be built in the already-urbanized areas mostly as apartments and condos, but the current housing stock in the region tells us that well over 60% of the homes are single family, and surveys tell us most people want single-family homes. In fact, we know that with respect to our greatest housing market, the Millennials, we’ve reached peak for urban Millennials, and it’s extremely unlikely that they will want to raise their families in the areas of San Diego that can still be developed that are close to jobs. There is a responsibility that North County—both coastal and the inland cities—have to share with the unincorporated areas of North County to approve housing in those communities. If we fail to do that, there will be economic consequences: companies that are here are not going to expand, new companies are not going to be formed and companies will move away, and the consequence of all this is that what housing is available will be bid up in price, will become too expensive and people will find jobs elsewhere.

GlobeSt.com: What solutions were proposed that could be acted upon by the industry or the county?

London: The speakers all spoke to those issues. We have to reform CEQA to establish a clearer path to permits to develop housing. We have to get the county incorporated and focus on the supervisorial race in North County coastal that’s up for reelection in November. But essentially, what we’re going to do next is hold a conference in the fall, sponsored by ULI, that will laser focus on solutions. Last week’s conference set the table to tell everybody what the problem is, and we hadn’t told them this before. Historically, it’s been an expensive county to live in, and now this is bleeding into the economy.

Deborah Ruane from the housing commission talked about a paper they had written about solutions, and Lynn Reaser from Point Loma Nazarene University spoke with respect to government fees and the costs associated with delays in housing development. There may be creative solutions that can come, we may be able to expedite the permit-review process, do a CEQA review and open up more land for development. Maybe we’ll see proposals that reform the way that community-planning groups are appointed or educated. There are a host of issues that have already been discussed, and we’re going to lay them out front and center in the fall.

If we want to get a more balanced process in place, we will have to look at all of these things—old and new things. There are some we haven’t discussed at all, such as companies that employ people will have to participate in housing their own people. We can talk about inviting and incentivizing them to do that, and there are some out-of-the-box legislative proposals that do that. But more importantly, we have to figure out how to create a constituency for housing—not to prevent housing in the community. We have to tell our elected officials this, and they need to understand that.

GlobeSt.com: What else should our readers know about this conference?

London: For the first time in my memory, we’ve gotten together a variety of economic and land-use people, as well as one developer, to really lay out all the issues and discuss them in a non-emotional way. This was empirical data, and we had a really sober, well-thought-out discussion. We need more of those.



 

 

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