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Jacobs Center Is Changing Its Strategy After Years of Stalled Development Progress

The Jacobs Center for Neighborhood Innovation’s long-running effort to revitalize 60 acres in southeastern San Diego has been plagued by roadblocks, including some of the its own making.

Years ago, southeastern San Diego residents were urged to imagine something more on 60 vacant, grass-covered acres that sit just blocks from a bustling trolley stop and a freeway exit – properties that would be highly coveted if they were almost anywhere else in San Diego.

But more than half of the properties the Jacobs Center for Neighborhood Innovation began buying up about a decade ago still sit dormant. Disillusionment and frustration has set in among residents who were told the properties would be developed into community assets that would revitalize the neighborhood.

Now the Jacobs Center is trying a different tack to bring in businesses, retail and housing. CEO Reginald Jones, who took the helm four years ago, has declared that the nonprofit will partner with developers rather than do that work itself. It’ll likely even sell some of its land.

Jones says the nonprofit’s committed and that obstacles are falling away but it’s difficult to predict exactly what’s going to happen. He’s not offering specifics yet.

What is clear is that the nonprofit has struggled to cope with an onslaught of roadblocks, including some of its own making. On top of the recession and long-standing infrastructure and zoning challenges, it’s wrestled with doubts about whether it’s got the mettle to do what it’s promised amid waves of layoffs and stalled progress. Community support has fallen off, and the residents who are interested want different things.

Along the way, Jacobs managed to build a shopping center at Market Street and Euclid Avenue with a grocery store and a Starbucks. It’s welcomed the area’s first drugstore, teamed with a developer on an affordable housing project, invested millions into a creek restoration project and opened the Joe and Vi Jacobs Center, a community meeting space that’s also the nonprofit’s headquarters.

Under Jones’ watch, the nonprofit’s hired a well-respected real estate consultant to help create a new development plan and promote its properties. It’s also celebrated the City Council approval of a new community plan, an upcoming street upgrade project and a unique agreement with Mayor Kevin Faulconer’s office meant to prioritize approvals on Jacobs properties. Last year, Jacobs brought in former Civic San Diego official Richard Seges to implement its new master plan.

“We have removed the barriers,” Jones said.

Jones now wants to have all the Jacobs land developed by 2021. Walking the properties last month, he spoke passionately about the potential of empty lots he hopes will soon be home to mixed-use developments. He also hinted at coming announcements of deals with developers.

Yet skepticism remains among residents and those who’ve worked with the nonprofit.

“I don’t know if they have the wherewithal,” said Kahlada Salaam-Alaji, a resident who was once more involved in Jacobs efforts.

Like many others, Salaam-Alaji lost faith when projects didn’t materialize.

Brian Trotier, who once led southeastern San Diego’s redevelopment agency, commended Jacobs for its more recent adjustments to address what wasn’t working – including the new master plan and partnership strategy – but noted years of stagnation could have a chilling effect.

“They’re pivoting,” Trotier said. “I just question if they’re pivoting too late.”

Even Charles Davis, who served as Jacobs’ director of project development from 2006 to 2013, questions whether Jacobs has what it takes.

“You just don’t have the expertise and commitment to get this done,” said Davis, who said he appreciates the investment the Jacobs family has made up to this point.

Photo by Sam Hodgson

Photo by Sam Hodgson

The land and the market are ripe for transformational development, Davis said, but it’s not clear whether Jacobs has the technical expertise and capacity to do all it’s promised.

Former Jacobs executives including Davis say the family predicted some of the challenges their effort faced when they first set their sights on southeastern San Diego years ago. They recognized the area’s bad reputation had deterred others and that the neighborhood was in need of many amenities and upgrades.

Former Jacobs Center CEO Jennifer Vanica, who led the nonprofit until mid-2011, said the Jacobses chose to invest in southeastern San Diego precisely because they believed their effort would spur more development and that residents could support the development. They believed their work could help counteract years of disinvestment.

The former community plan for the area and requirements set by now-shuttered redevelopment agency Southeastern Economic Development Corporation added uncertainties and costs.

The city’s community plan for the area didn’t allow for much density or mixed-used developments, so pursuing them meant enduring drawn-out permitting processes. At the same time, southeastern San Diego was beset with decades-old infrastructure and wasn’t receiving significant city resources for upgrades.

In late 2015, the City Council approved a new, less restrictive community plan for the area that includes the Jacobs properties, and the city’s started to step up its infrastructure investments. The city’s also committed to a large-scale street upgrade project Jones believes could make projects in the area more attractive to developers.

Vanica said the nonprofit had waited on those things for years.

“If you were looking for an easy property to develop and wanted a smooth timeline and wanted limited risk, this would not be the part of town you would pick,” Vanica said.

The Jacobs Center managed to build Market Creek Plaza and the Joe and Vi Jacobs Center despite the risks. Then a recession hit, stalling development throughout the city. Gov. Jerry Brown’s decision to end redevelopment, which had provided a revenue stream for revitalization projects, didn’t help either.

Still, development experts who’ve talked with the Jacobs Center over the years say its leadership bears some responsibility for the lack of progress.

The Jacobs family and the nonprofit’s former leaders had been in denial about challenges they faced and were for years unwilling to act on outsiders’ advice on what wasn’t working, they say.

“Early on, the Jacobses thought they could do everything,” said Mirle Rabinowitz Bussell, a San Diego State researcher who co-wrote a 2013 book on philanthropic community-building efforts, including Jacobs. “I think they were unrealistic in their ambitions.”

Bold proposals Jacobs leaders described to residents only complicated matters.

Hundreds attended meetings to offer feedback on plans over the years. Jacobs publicly floated the possibility of a movie theater, a charter school, a Walmart, a hotel and an In-N-Out Burger, among many other ideas, for its properties.

All that discussion was by design. Jacobs wanted the community to drive its development plans. They sought feedback on what residents wanted and then consulted them as possibilities seemed to solidify. Many things they discussed didn’t happen.

Fearing that outcome, Trotier said he tried to warn the Jacobs years ago. He recalls telling Jacobs family members that much of the development residents wanted wasn’t feasible in southeastern San Diego at the time they sought it, and that they needed to be more honest about that.

“Nobody wanted to tell the community the whole truth and nothing but the truth,” Trotier said. “Everybody wanted to tell the community what they wanted to hear.”

Davis said Jacobs failed to fully educate residents about what the market could support and compromises that could facilitate development.

The family seemed to naively think it could succeed despite others’ warnings, he said.

“I don’t think they purposely misled,” Davis said. “They thought if the people wanted it, that was gonna happen, marketplace be damned.”

The Jacobs’ approach differs from that of Price Philanthropies, a similar place-based charitable effort. That foundation bought and developed more than 50 acres in City Heights with a new library, police station and housing over a decade. Price sought community feedback but then quickly proceeded. When that effort started, City Heights didn’t have the outspoken roster of community activists present in southeastern San Diego.

“[Jacobs was] more of a planning agency and we were more of an action, build-it-now kind of organization,” said former city manager Jack McGrory, who led Price’s development effort.

Davis, who worked for Jacobs and assisted on multiple Price projects, said the team behind the Price developments also benefited from a willingness to invite outside experts to lead the way on projects they had experience executing.

“Jacobs never would do that,” Davis said.

Vanica defended Jacobs’ past decisions and messaging to the community. She said Jacobs leadership tried to be open about obstacles as they came up and invited the community to grapple with them. She also said Jacobs hired rather than partnered with experts due to a general lack of interest from developers.

“If you only look at it only from a development point of view, you probably would do it differently but if you have to balance that with community-building, and not coming in and taking over the right for people to weigh in on what their own historical neighborhoods have been like, then you’ve got to think about it differently,” Vanica said.

The Jacobs Center has since changed a key aspect of its approach. Jones, the current Jacobs CEO, said he recognized the need for a shift toward partnerships with outsiders.

He points to the 2016 opening of Trolley Park Terrace, a 52-unit affordable housing project developed by Chelsea Investment Corp., as an example of a successful partnership.

Jones has said the nonprofit remains focused on luring development that reflects what southeastern San Diego residents want.

But Jacobs’ balancing act with the community has led to decisions that frustrate developers interested in working with the nonprofit.

For example, residents have emphasized they want new housing to serve varied income levels rather than solely low-income residents.

Yet Jones said nearly all the responses Jacobs received following a recent request for proposal process for two Jacobs parcels pitched affordable-housing projects.

“I will go on record saying you can’t build out a community through all low-income housing tax credit projects,” Jones said. “We must have a mixed-income strategy. Our community roundtable, residents at the roundtable, have spoken to that.”

Jacobs’ feeling that it must proceed with the right kinds of development, plus multiple staffing cuts and the need for the entirely family-run Jacobs board to sign off on proposals, have led to confusion about what Jacobs wants to pursue on its properties.

Stories abound of stops and starts, and of initiatives and plans that later faded.

Diane Moss, managing director of urban agriculture nonprofit Project New Village, said she submitted a proposal to Jacobs last year for a temporary community garden on one of Jacobs’ vacant properties only to go months without hearing from the nonprofit. Jacobs had urged her to get involved.

Like many longtime southeastern San Diego residents, Moss recalls once feeling optimistic about possibilities for the Jacobs properties. Now she’s cautious – including about her own proposal.

“We are told they have a master plan,” Moss said. “They are moving forward, we hear, and that’s all we know.”

Jones and the Jacobs family said the nonprofit is taking steps to make the longtime vision a reality.

“Work is in process and we expect to succeed,” they wrote in a statement.

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