A real estate contest, which dwarfs the size and scope of the city’s sports arena contest, looms on the horizon.
This fall, the U.S. Navy intends to issue what is called a Request for Qualifications to revitalize its sprawling NAVWAR campus in the Midway District, Greg Geisen, who is the effort’s project manager, told the Union Tribune. The action, which will be quickly followed by a call for tenders, will launch a real estate competition where almost anything goes.
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On Thursday, the federal agency issued a press release announcing the ongoing solicitation and inviting developers to pre-register with its procurement system, SAM.gov.
The Navy will offer up to 70.5 acres of federal land to free bidders to dream taller than local height limits or step outside the bounds of state affordable housing requirements. There is at least one major constraint: development teams must build, at no cost to the Navy, 1.7 million square feet of new offices and warehouses, of which 1.1 million square feet must remain on the property.
That’s the bottom line, Geisen said.
The ownership swap – meaning land in exchange for facilities – is modeled on the agency’s 2006 deal with Manchester Financial Group for its Navy Broadway complex. The experimental public-private partnership ultimately resulted in a 17-story waterfront office building for Navy Region Southwest, Naval Installations Engineering Command Southwest and Component Command Navy Region Southwest Reserve. Life sciences property developer IQHQ is now rapidly erecting laboratory buildings and constructing a public park on the rest of the 12-acre site.
The NAVWAR property, which straddles the Pacific Highway and collides with Interstate 5 in the Midway District, is nearly six times larger.
“It’s a big project. So we expect big teams. …Some of the biggest name developers will probably submit to it. And they will be associated with other very large companies and experts in their field,” he said. “So they’re going to try to set up their A game for a very, very big (public-private partnership). It’s going to be the biggest (public-private partnership) the Navy has ever done, in (expected dollar value ).”
The Navy’s intention to issue a competitive solicitation is now a distinct departure from previous plans.
The agency had been working to complete its environmental analysis of the site. In the works since January 2020, the report, a requirement of the National Environmental Policy Act, aims to create a framework for what is possible on the property. However, a draft plan, released in May 2021, which considered — and favored — up to 19.6 million square feet of development spread over 109 buildings, some reaching 350 feet, was troubling to many.
The Navy received a deluge of comments, more than 1,000 comment letters, on the report.
“When we went to the public and public agencies with our (draft environmental impact statement)…they (told us): ‘We are really not comfortable with a large umbrella without understanding what’s going to happen on the Navy portion of the federal site and what’s going to be on the commercial site. We need more details,” Geisen said. “So we’ve changed our timeline. What what we’re going to do now is instead of getting a (decision case in the environmental review process) and then going to market, we’re going to market and going to (reduce the scope) to one developer.”
The winning development plan will then serve as a guide for the remaining environmental works, giving the public a clearer picture of what they can actually expect to see at the site, he said.
Owned by the Navy since the mid-1990s, Naval Base Point Loma, an Old Town complex, is home to the divisions of Naval Information Warfare Systems Command and Naval Information Warfare Center Pacific. The groups – a mix of 5,000 full-time and contract cybersecurity professionals – operate the world’s largest intranet with 700,000 network users in 2,500 locations, according to the federal agency. Defense personnel work in World War II hangars deemed outdated, with sewer problems and leaky roofs, among other problems.
Navy officials, keen to secure new offices and labs, tested private sector interest in the site in September 2018. However, in 2019 the Navy partnered with the Association of Governments of San Diego as part of a joint planning effort to study the prospect of putting a transit station serving the airport, or what has been called San Diego Grand Central, alongside Navy facilities and private development on the vast property. In 2020, government agencies commemorated their intention to work towards a land transfer with an exclusive negotiation agreement.
Now they are heading in different directions. SANDAG has identified ownership of the Port of San Diego Administrative Offices as its preferred link, via a $4 billion people carrier, to the airport. In the longer term, the transit agency said it hopes to build a transit hub with bus, light rail and subway service using 10 blocks of city and state-owned sites in the center. town.
Parting ways could prove to be a boon for the Navy’s real estate competition, likely sparking even more interest now that developers don’t have to incorporate a transportation hub.
“All those costs are now irrelevant,” said property analyst Gary London, director of local firm London Moeder Advisors. “The development deal can be assessed by itself and the test will be how to make it workable.”
London expects locations to come from national businesses and include a mix of office space, residential units, retail, hotels and park space – on a large scale.
It’s because the development teams kind of have a blank canvas. The land is federally owned and will likely be leased long-term, which means local zoning laws or building height restrictions do not apply. Also, California’s surplus land law, which requires municipalities to turn over their land to developers who set aside at least 25% of residences for low- and very-low-income families, is not applicable.
Still, the Navy says it wants to be a good neighbor.
“There is the law and then there is common sense. Ultimately, the Navy wants to be a good partner here in San Diego. We are a federal agency and we follow different legalities,” Geisen said. “But on the other hand, we have a great relationship with the city and the people of San Diego. We wouldn’t want to turn around and make it confrontational.
The Navy intends to encourage all potential master developers to work closely with the local community and consider the Midway-Pacific Freeway Community Plan, said Caitlin Ostomel, spokeswoman for the region. navy southwest.
The opportunity, however, is considerable, likely to produce something an order of magnitude greater than what’s on offer down the road at San Diego’s 48-acre sports arena site.
“I think it’s going to be a transformational project for San Diego. Basically, they’re going to transform an entire neighborhood on a very large scale,” London said. pass every day without even thinking about it. This will be a very visible project. It’s near transport. It’s near downtown. It’s near the airport. There will be a huge demand for types It’s a perfect urban infill project on a scale that could only be replicated in a few places (in San Diego).
The timeline is still being determined, but the Navy plans to launch its solicitation before the end of the year and take about a year to choose a winner.
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