News Summary
San Diego is preparing to sell or lease the City Operations Building under California’s Surplus Land Act. Despite potential low developer interest, the city is soliciting bids for the 1.4-acre property, aiming for substantial returns, while requiring at least 25% of residential units to be for low-income families. The site has significant maintenance needs and past attempts to gauge developer interest have yielded minimal enthusiasm, raising concerns about the feasibility of redevelopment. The bidding deadline is set for September 30, with city officials watching closely as plans for a new arts and education hub unfold.
San Diego is moving to put the City Operations Building (COB) at 1222 First Ave. up for sale or lease, under California’s Surplus Land Act, indicating a push to recover costs despite likely limited interest from developers. The city’s Economic Development Department has published a notice inviting bids, with a deadline for submission set for September 30.
The 1.4-acre property occupies an entire downtown block bordered by A Street, First Avenue, B Street, and Front Street. The city is aiming for significant returns, but council members acknowledged that previous endeavors to gauge interest in nearby properties have been met with minimal enthusiasm, attributed largely to comparable affordable housing stipulations. As part of the bidding criteria, developers are required to allocate at least 25% of residential units for low-income families.
The COB, built in 1970, is a five-story structure that has housed the city’s Development Services Department (DSD). However, it has fallen into disrepair over the years, with nearly $129 million in improvement and maintenance needs identified in a facility assessment conducted nine years ago. The DSD is currently transitioning to new locations, leaving the COB vacant by the end of August, save for Fire Station 1, which remains operational.
In a mid-July meeting, the San Diego City Council took the initial step of declaring the COB surplus, a necessary action under the Surplus Land Act to facilitate the sale or lease of the property. After the 60-day submission period for proposals concludes, the city will enter a 90-day negotiation phase with potential bidders. Preference will be given to those offering the highest volume of affordable housing units in their redevelopment plans.
Despite this structured approach, there are concerns regarding the viability of the redevelopment. The building’s poor physical condition poses a significant challenge, alongside the financial burden that comes with constructing affordable housing units. Additionally, project labor agreements (PLAs) will be required for bidders, potentially raising project costs and complicating proposals even further.
If the city fails to attract suitable bidders during this period, there may be consideration to re-list the property under more traditional sale terms with relaxed affordable housing expectations. The mayor has also indicated a strategy to consolidate municipal workers into existing complexes in light of current budget constraints, which adds another layer of complexity to the future of the COB.
Looking ahead, there is a vision for redeveloping the surrounding Civic Center area into a new arts and education hub. However, concrete plans are still uncertain, given the ongoing budgetary issues facing the city. The development potential for the COB remains fluid as city officials weigh their options amid the mismatch between required affordable housing commitments and the attractivity of the site for developers.
With the deadline for bids approaching, stakeholders and residents alike will be watching how this endeavor unfolds. The city’s approach under this surplus land framework could significantly impact the availability of affordable housing in the downtown area and shape future development in San Diego.
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Additional Resources
- San Diego Union-Tribune: Downtown Operations Building is on the Market
- San Diego Union-Tribune: Preparing to Put Downtown Operations Building on the Market
- GlobeSt: San Diego Scraps Downtown Civic Center Redevelopment
- CBS 8: San Diego Considers New Homeless Shelter Sites
- Wikipedia: Affordable Housing
Author: STAFF HERE SAN DIEGO WRITER
SAN DIEGO STAFF WRITER The SAN DIEGO STAFF WRITER represents the experienced team at HERESanDiego.com, your go-to source for actionable local news and information in San Diego, San Diego County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Comic-Con International, San Diego County Fair, and San Diego Pride Festival. Our coverage extends to key organizations like the San Diego Regional Chamber of Commerce and United Way of San Diego County, plus leading businesses in biotechnology, healthcare, and technology that power the local economy such as Qualcomm, Illumina, and Scripps Health. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HEREMissionViejo.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
