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How Small Developers Are Filling in the Urban Core

Walking an investor through a potential project site a few years ago, Mike Burnett and Craig Abenilla explained their plan to leave the decrepit gas station structure in place, so they could incorporate it into their housing and commercial project.

“He took one look and said, ‘I’m out,” Burnett said.

But “You Are Here,” a mixed-use project on 25th Street in Golden Hill and the second project for Burnett and Abenilla’s Foundation for Form, went forward.

Photo by Sam Hodgson [1]
Photo by Sam Hodgson

Along with the pair’s first project across the street, which began as Burnett’s senior thesis at the Woodbury School of Architecture, the two modestly sized projects played an integral role revitalizing the southern end of Golden Hill’s commercial area.

Their third project, in North Park, was an easier sell.

At the old Post Office on Grim Avenue and Ray Street, they’re pursuing a similar idea. Again, they will incorporate the old building into the new project.

Like the others, it was designed with a young, urban renter in mind.

Its courtyard and each individual unit are meant to push residents together, not wall them off in seclusion.

“That was my driving force: How does space change people?” Burnett said.

“We’re designing for the 20 to 40, urban, energetic, go-getting lifestyle,” he said. “That’s who I think is most interesting.”

Photo by Sam Hodgson [2]
Photo by Jamie Scott Lytle

Abenilla said there’s a tendency in San Diego to want as much space as possible, without regard for aesthetics.

“The mentality is so weird here,” he said. “We’re trying to change that mentality a bit.”

In doing, they’re part of a group of developers that’s having a lot of success on their own terms.

Young architects like them have joined established names like Lloyd Russell, Ted Smith and Jonathan Segal to pursue an identifiable urban-centric style and mentality.

“They’re creating the architecture that we all appreciate and understand as part of a San Diego vernacular,” said Howard Blackson, an urban planner and board member of the city’s nonprofit planning arm for downtown, Civic San Diego. “They’re good for San Diego.”

They tend to share a few characteristics.

Woodbury

For one, there are a lot of connections to Woodbury, a satellite campus of the Los Angeles architecture school that opened in Barrio Logan in 1998.

Segal teaches there, Smith runs a master’s program in real estate development for architects, and people like Burnett, architect-developer Andrew Malick and others graduated from there.

“The turning point was getting graduates from Woodbury out in the city doing work,” Segal said. “There’s a critical mass now. It’s not just me and Lloyd and Ted; it’s Mikey and Andrew and three to five other people. The ball is rolling.”

Architect-Developers

Another distinguishing feature of the group: It’s composed of architect-developers, not just architects or just developers. That means they work for themselves and usually own their projects. It affords them freedom to pursue the project they want.

“Every unit in ‘You Are Here’ is different,” Burnett said. “No one is going to do that except an architect-developer.”

Besides creative freedom, it also makes them nimble.

“Within our circle we’re all doing this because when you act as architect and developer, the intention is to get around the layers of bureaucracy within the construction industry that get in the way of what you want to build,” said Russell, who has built projects like the Centre Street Lofts in Hillcrest, The Station in South Park and collaborated with Smith on a number of buildings in Little Italy.

It also frees them from fear of litigation.

“If you’re an architect-developer, now suddenly you can innovate,” Smith said. “Because otherwise, the moment you do something that’s not the industry standard, you’re going to court.”

That means if they build a condo unit with a non-standard skylight because it looked cooler, and the new condo owner sued because the skylight sprung a leak, the developer would lose the lawsuit for having deviated from the industry standard. By designing, developing and owning their own project, they can just fix the leak if one of their renters has a problem.

And things do go wrong over the course of construction. If an unforeseen situation arises when there’s only one decision-maker, the process doesn’t come to a complete stop.

“It enables us to be fluid; it’s the key to our expediency,” Segal said. “Imagine if in heart surgery, a surgeon had to ask administration for clearance to make a decision when things went wrong.”

For the community, that means fewer delays, less time staring at a construction zone and less expensive housing once all’s said and done.

It also necessarily means smaller projects.

“Acting as architect-developer, there’s an inherent limitation of scale,” Russell said. “Once you get bigger, you have to divide responsibilities. A 500-unit project requires a team.”

Small Lots

That’s another shared characteristic: They build on small lots in already developed urban areas.

“I had a big developer say to me one time, ‘Oh, what you guys do is boutique development,’” Russell said.

Where Civic San Diego looks to develop an entire city block with a single project, these craft developers are finding smaller, sometimes oddly shaped parcels and designing them to fit within the existing urban fabric.

“If you go to USC and get a developer’s degree, the first thing they’ll teach you is ‘If you build small projects you’ll never get rich,’” Smith said. “The only ones who will build little projects are architects, because they understand urban issues.”

Investors and real estate professionals for years have been touting the importance of “infill development”—projects within already developed areas—to address the region’s housing shortage, since the availability of massive tracts of green field has mostly run out.

“Cities are about trade-offs,” Smith said. “So what do you want? A carbon footprint of a suburbanite versus a dense urbanite is something like 10-to-1.”

That’s a mindset Smith passed to Burnett at Woodbury. He said Smith taught him to make small urban incisions, not to revamp a whole block.

“He’s a hippie basically, he puts people first,” Burnett said. “He says: Don’t chase the neighborhood away. Look at it, find what’s cool about it and expand upon it.”

Russell said San Diego is beginning to build a reputation for these sorts of small, innovative housing projects.

“It’s filled a necessary niche,” he said. “For big builders, it’s not efficient to do 10 units, they have too much staff. So there’s a gap between single-family homes and large developments.”

Ministerial Projects

Crucially, these developers predominantly look to build as much as they can in a certain spot before they’re forced to enter the discretionary review process.

“By-right development,” as it’s called, means figuring out the threshold in any given area’s zoning that triggers a review by some combination of a community planning group, the citywide Planning Commission, a hearing officer or the City Council.

That process costs time and money, so these architect-developers avoid it altogether by building as much as the zoning will allow without crossing that threshold.

If a given lot allows you to build 24 units before the project must answer to the local planning group, build the 24 units and call it a day. Parking requirements, height limits and a number of other factors make interpreting the code more complicated, but that’s the basic idea.

“They say, ‘Why should we bang our heads against the wall in this unpredictable process, when we can just know the code better than anyone and get a lot out of it?” Blackson said.

Joe LaCava, chair of a group that advises and oversees community planning groups, said the idea is for community plans and zoning regulations to give clear, numeric guidelines about what the community wants from developers. If a project fits, there’s no need for review.

“Unfortunately what we’ve learned is what we thought the regulations would give us and what we get are different, and that’s where the tension comes in,” he said. “While some people think by-right planning is a way to exclude the community, it’s the community group that originally said what regulations would apply.”

Better, LaCava said, would be zoning that tells developers specifically what a community wants, rather than what it doesn’t want.

Doing it this way, combined with developing on small lots, means these “boutique developers” are settling at a sort-of medium density.

They’re not putting in one single-family home on an urban lot close to jobs, and they’re not building a mega-development that really pisses off the neighbors.

Smith said finding the right density within the code usually comes down to parking requirements.

“There’s a natural breaking point that happens when you build the biggest by-right project you can before you have to build a parking garage,” he said.

Zoning calls for providing a certain amount of parking based on the number of housing units or commercial square footage. Once you reach a certain number of needed spaces, you need to build a parking garage, drastically inflating the price of the whole project. Once you’ve added the garage, you need to build another 30 housing units to become profitable again.

That’s why Smith tells his students to find the point just before they need a parking garage, and build that many units.

“It makes for a great fabric,” Segal said. “It’s not monster-sized. It’s sized for a building that works, not some monster thing that kills a neighborhood.”

Russell is preparing to build one of his biggest projects yet in Bankers Hill, and will need to go before the Uptown Planners group for approval.

“I’m vacillating between heroic guy and the pensive developer, thinking it’s too big,” he said. “I’ve been warned that it’s a hassle, but I’m just hopeful they’ll appreciate good design.”

Even though there’s now a critical mass of these neighborhood-minded developers, they’re still outgunned by big projects by out-of-town developers.

But their numbers are increasing with each class from Smith’s program at Woodbury, and their expedited process means they make up for some of their projects’ smaller size by building more of them.

“We’re setting the standard now, giving other people an opportunity to embrace our ideas in their projects, and it will increase quality across the board,” Segal said.

“I think we’ll look back in a few years, and it could be really big. But stars have to align for that to work,” Russell said.