By Dave Schwab

Circulate San Diego plan would build on La Mesa MTS properties

Circulate San Diego has proposed alleviating the affordable housing crunch by transforming Metropolitan Transit System (MTS) parking lots into low-income housing.

The transportation and land-use think tank’s suggestion was published recently in a report titled “Real Opportunity.” The report reveals MTS has at least 57 acres of available property, much of it underutilized transit parking lots.

Circulate San Diego estimates those marketable MTS properties could support development of 8,000 new dwelling units, of which 3,000-plus could be reserved as permanently affordable low-income housing.

While questioning MTS’s calculations, Rob Schupp, director of marketing and communications for MTS, San Diego’s public transit service, said the agency is receptive.

“All of our properties are available,” said Schupp pointing out 8,000 units on 57 acres translates into 140 units per acre.

“How realistic are Circulate’s calculations?” he asked. “It has been estimated the city alone will have a deficit of 200,000 units in the next 10 years. So MTS’s contribution to solve the housing shortage would be small.”

Nonetheless, Schupp added, “We are definitely supportive of maximizing the value of our properties, and are open to look at Circulate’s ideas.”

Reacting to Circulate San Diego’s suggestions to use MTS parcels for new low-income housing stock, 9th District Councilmember Georgette Gomez commented, “MTS has a great opportunity to re-evaluate our policies in order to promote transit-oriented development, especially with affordable housing. These updates, along with state legislation like AB 2372, can change how our communities are developed and help house more San Diegans, while increasing transit ridership. I look forward to bringing this conversation to the MTS board and working to activate MTS properties for the best interest of the general public, while reducing our greenhouse gas emission impacts.”

AB 2372 would allow local governmental jurisdictions to provide developers with a density bonus and other incentives or concessions for producing lower-income housing.

While conceding that utilizing MTS surplus properties won’t “solve” the existing affordable housing shortage, Colin Parent, executive director of Circulate San Diego and La Mesa City Councilmember said, “You can’t think about these things in large numbers. If there are 8,000 more homes, and you’re one of those 3,000 low-income renters going to be living in them — then it’s very meaningful.”

Added Parent, “The reality is we’re not going to solve our housing crisis with any one solution. That means taking every opportunity we have to allow new homes to be built, especially where they make the most sense, along transit routes and especially on parcels of property that aren’t being used for anything — or aren’t being used at full capacity, like the MTS properties.”

Parent cited the Grantville Trolley Station as a prime example of an MTS parcel that could be put to better re-use.

“The station is on about 10 acres of land, almost all of it dedicated to parking, and very few cars are ever parked in that lot,” he said. “There’s also not a lot of residential, or jobs, immediately adjacent to that stop. So we have a really big resource that we’re not allowing many people to be able to use.”

In La Mesa, there are three properties on the MTS joint development property inventory list. The Baltimore Junction site located between Interstate 8 and the Costco shopping center is a highlighted property and has 2.5 acres of developable property. Also on the list is the 2.18-acre parking lot for the Amaya Drive Trolley Station, which a portion of which is currently being used by Goodwill.

The MTS property along Spring Street is the largest at 3.91 acres, however comments on the MTS inventory list indicate that the property will likely be used to extend High Street under the trolley tracks “as part of the Navy’s commitments to La Mesa.”

The San Diego Housing Federation is a nonprofit advocate for affordable housing. The agency’s executive director, Stephen Russell, said the housing crisis is so acute, especially at the low end, that any additions to the available housing stock are direly needed and welcome.

“We’re talking about the low-income sector, people making 60 percent of the area median income, such as below $79,000 for a family of four making $48,000,” Russell said. “We’re talking about low-wage working families, seniors, veterans and, increasingly, people who are homeless.”

Referring to housing as “the great crisis of our time,” Russell noted the MTS parcels “are perfectly located to help provide additional housing units.” Russell said the challenge now is how best to “actively pursue acquiring these properties that meet the proper criteria,” while finding developers “willing to make it happen rather than simply being open to the idea.”

Russell pointed out the seriousness of San Diego’s housing shortage is confirmed by the current numbers. He cited 5 percent as the threshold figure indicating the dividing line separating surplus from shortage in the housing market.

“If the vacancy rate for renters is higher, 7 or 8 percent, then landlords have to begin making concessions, months of rent free, big-screen TVs, etc.,” he said. “If vacancies go below 5 percent, tenants have much less bargaining power, and rents go higher. It’s been estimated we have a 2.5 percent to 2.8 percent vacancy rate right now.”

Enter Mario Turner, vice president of Orange-County based AMCAL Multi-Housing, Inc. which builds affordable housing throughout Southern California, including San Diego. AMCAL presently has an affordable housing project, Villa Encantada at 505 62nd St. and Imperial, under construction.

Villa Encantada is the redevelopment of an underutilized parking lot next to a trolley station on 1.7 acres, which will include 67 low-income family apartments offering replacement parking for MTS while providing 1,000 square feet of retail space.

Noting Villa Encantada is “San Diego’s first affordable-housing, transit-oriented development,” Turner added the project has been in the pipeline since 2011.

Asked about Villa Encantada’s significance in the affordable housing market, Turner replied, “It’s the future.” He adding finding suitable properties is problematic.

“Finding large enough parcels to develop in parking lots near trolley stations is not easy,” Turner said. “Once you identify suitable properties, it takes years to get them through city planning department’s permitting process.”

Then of course, said Turner, there is the all-important issue of obtaining financing.

“Big-lender investors in affordable housing, they aren’t always enough,” said Turner noting financing for Villa Encantada involved acquiring a mixture of public-private financing including state grants and loans, tax credit equity and other sources. “You need multiple layers of financing to bring down the rents for folks that are in the lowest income levels,” he said.

Turner believes MTS is ideally constituted to contribute to the effort to alleviate the affordable housing crisis.

“If you look at their presence in the region, and their underutilized parking lots, you have one of the pieces of the puzzle needed to resolve our future low-income housing needs,” he said.

Circulate San Diego’s housing report recommends MTS make the following policy reforms:

Create a joint development program that issues requests for proposals for priority sites while actively soliciting development partners.

Require any residential development to include a percentage of homes to be made permanently affordable for low-income families.

Eliminate the costly requirement for new developments to replace or maintain parking where it is already underutilized.

“With the new leadership on the MTS board, we believe that the transit agency has a real opportunity to transform its empty parking lots into affordable homes,” concluded Parent.

— Dave Schwab is a San Diego-based freelance writer. Reach him at [email protected].