Downtown San Diego Blocks to be Redeveloped for Affordable Housing, Retail

A construction worker. Photo via Pixabay

The state Tuesday awarded two blocks of Downtown San Diego to the Michaels Organization to develop into affordable housing, as well as market-rate units, office space and retail.

The California Department of General Services and the California Department of Housing and Community Development awarded the “excess” state property to Michaels as part of Gov. Gavin Newsom’s effort to spur housing development under the Excess Land for Affordable Housing Executive Order.

“This redevelopment project is a testament to what can be accomplished when the state and local governments work together to advance sorely needed housing,” said Ana Lasso, director of the Department of General Services. “We expect this project to also embody the sort of shift from office to residential that thoughtful downtown development can achieve.”

The state, the city and the developer will spend the next few months developing the project concept.

The property is bordered by West Ash to the north, West A to the south, State Street to the west and Front Street to the east, and contains an excess state office building, 1350 Front Street, which is expected to be demolished.

“Working to meet the state’s need of 2.5 million new housing units by 2030 requires commitment, creativity and collaboration at every level of government and community,” said Gustavo Velasquez, director of the Department of Housing and Community Development. “As we look to making the highest and best use of public lands, we must center affordable housing and climate solutions, and this project does just that.”

The state and city of San Diego issued a request for interested developers in November 2021 for the project.

“The city of San Diego has been proud to be a partner in selecting a developer to transform these two underused blocks of state property and create homes for San Diegans,” said San Diego Mayor Todd Gloria, who authored a 2019 law to promote the use of excess state properties for housing. “Turning these blocks into hundreds of affordable homes as quickly as possible will help address our housing crisis and revitalize a part of our urban core that, frankly, has seen better days.”

“I’m grateful to Gov. Gavin Newsom for his commitment to using state property to improve San Diego and look forward to working with the state and the Michaels Organization to finalize and build this fantastic project,” Gloria said.

City News Service contributed to this article.