SAN DIEGO (KGTV) — After plans to redevelop the Midway District's Sports Arena site were halted in March, the city said Thursday that it is restarting the process from square one.
Three months ago, the city halted negotiations with commercial developer Brookfield Properties because the group's plan to redevelop Pechanga Arena into a new venue, and the surrounding area in park space, retail, and housing may have conflicted with California's Surplus Land Act (SLA), which requires that the land be offered to affordable housing developers first.
The city said Thursday that it was notified by the state that the proposed plan is likely in violation of the SLA.
San Diego Mayor Todd Gloria laid the blame for the real estate misstep on former Mayor Kevin Faulconer, and said he will begin a new bidding process that complies with state law and prioritizes affordable housing.
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"This is yet another example of a flawed real estate deal from the previous administration where San Diegans are now left with little to show for a significant investment of time and resources," Gloria said in a release. "I am committed to work quickly to restart this process in compliance with the Surplus Land Act. It is critical that we do not squander this once-in-a-generation opportunity to build a modern arena through a process that prioritizes the affordable housing our region desperately needs."
The plan was proposed back in early 2020, under then-Mayor Faulconer.
Mayor Gloria said in a release that he intends to ask the City Council next month to restart the process.
City Council President Jennifer Campbell asked that Gloria and the city's real estate assets team quickly reissue a request for proposals for the site.
"The Midway District has long been a forgotten corner of San Diego and this decision delays the timeline on a sorely needed upgrade," Campbell said. "I understand that many in the community will be frustrated with this unexpected outcome. That is why I am committed to working with Mayor Gloria, my council colleagues and community stakeholders to restart this process in a way that is in compliance with state guidelines.
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"To be clear, creating affordable housing for San Diegans has been one of my top priorities. One silver lining in this decision is the chance to add more homes for working San Diegans to this site," she added.
Last July, the city put two development proposals before the public for input on who would redevelop the site, one from Brookfield Properties and ASM Global, and another from TOLL Brothers and David Malmuth Development. Both plans included a new venue, housing, retail, and park space.
Ultimately, the city went with Brookfield Properties' plan.
Laura Nunn, with the San Diego Housing Federation, told ABC 10News back in March that the site is a big opportunity to address the city's housing crunch and that laws like the SLA are aimed at helping municipalities maximize available land.
"It's a big site. Land like that is not available in the city, for the most part, in this city, especially in a location like that so it's a big opportunity," said Nunn."We need affordable housing so badly and tools like the Surplus Land Act are there so we can maximize our public assets for the public good."
The SLA originally only addressed land that was for sale and not land that was leased. Brookfield had planned to lease the land from the city. However, the act was recently updated to include land that is also leased.
Another aspect that was at play during the planning process was the Midway District's 30-foot height limit. In November 2020, Measure E was placed on the ballot to remove that restriction and allow taller buildings on the 900 acres included in the Midway/Pacific Highway community. Voters passed that measure.
Though the height limit removal was approved, Campbell told ABC 10News prior to the election that it won't mean high-rises or skyscrapers are coming to the district, but instead, puts the area back to the limits in the City Municipal Code, between 30- to 100-feet depending on the parcel of land.
"We don't want really huge buildings," Campbell said. "We won't have skyscrapers, we won't be losing the character of San Diego. It should make it possible to have a beautiful area with housing, jobs, walkways, bike paths, parks, and entertainment complex there in the Sports Arena area."