Grading has begun for a major business park on Otay Mesa, one of the major changes in the San Diego/Tijuana region.
Improvements on both sides of the border were discussed at an Urban Land Institute breakfast Tuesday at the University Club.
Kaitlin Murphy, Murphy Development executive vice president and partner, said grading has begun on the 3 million-square-foot Brown Field Technology Park even though The CoStar Group reports that there are still more than 1.8 million square feet of vacant industrial space on Otay Mesa.
However, Murphy Development president and Kaitlin’s father, R. Michael Murphy, said that the vast majority of the vacant space to which CoStar is referring is at least 25 years old and functionally obsolete.
The new development, next to the 155-acre, 2 million-square-foot Brown Field Industrial Park, will be built on 50 acres on both sides of Interstate 805.
Kaitlin Murphy said opportunities at Brown Field Technology Park will range from 50,000 to 2 million square feet and that build-to-suits will be the first projects up.
Each of the business parks, whether on the U.S. or Mexican side of the border, stands to benefit from shorter border crossing times.
James Clark, executive director of the San Diego-Tijuana Smart Border Coalition, cited a 2012 Border Research Partnership study that border wait times were costing the United States $8 billion annually.
Jason Wells, San Ysidro Chamber of Commerce chief executive, agreed the impact is huge.
“Some 53,000 jobs were lost [annually] due to border wait times. If you have 90 out of the 200 people in your business not knowing when they are going to be able to arrive, that’s not going to work,” Wells said.
Until last month, wait times of more than two hours were a regular occurrence. With the addition of 34 lanes at the San Ysidro Port of Entry at a cost of more than $700 million, it’s not uncommon now to get through the line in 15 minutes.
“People had stopped going because of the wait times, along with the requirement to have a passport,” Clark said.
Wells said that while great strides are being made to improve the wait times for motorists, the pedestrian-crossing facilities have not kept pace.
Although not everything is happening as Wells would like, he is encouraged that the cross-border terminal allowing people who live in the U.S. to access international flights from Tijuana’s Rodriguez Field is finally under construction.
“People were talking about that 20 years ago,” Wells said. “The South County [Economic Development Council] was asking what would happen if we had twin airports.”
The 65,000-square-foot, $120 million terminal is scheduled to be complete in summer 2015.
Clark said people not only have been missing out on easily getting on a plane at Rodriguez Field, but they have also been missing out on a huge chunk of commerce.
Clark said that each year, Tijuana buys more than $13 billion in manufacturing components outside of California that are driven south through San Diego.
“If we got 10 percent of this business, that’s $1.3 billion,” Clark said.
Kaitlin Murphy, who noted that between 1 million and 2 million people are expected to pass through the new terminal each year, said she is hopeful the second Otay Mesa border crossing may be open in 2017 or 2018.
In the meantime, Murphy said the 800 acres of Brown Field Airport and its environs will also see enormous changes.
“New retail, hotels and industrial are planned around the [fixed-base operator of the airport],” Murphy said.
Murphy said people shouldn’t forget the thousands of housing units that have been built on Otay Mesa — providing Otay Mesa’s employees with an easily accessible place to live. Thousands more units may yet be built.
Murphy said investors have noticed that Otay Mesa is up and coming, as evidenced by San Diego-based R&V Management’s $150 million purchase this month of the 644-unit Greenfield Village Apartments on western Otay Mesa.
Clark said not only will Otay Mesa continue to provide housing for its workers, but The Corky McMillin Cos.’ eventual 3,000-unit Millenia development in Chula Vista will also provide housing for Otay Mesa workers.
Conversely, Greg Shannon, who is developing multifamily housing in Tijuana, said the city has always been a draw because of its affordability, especially today.
“It’s the most European city we have around,” Shannon said. “It’s an incredibly walkable place.”
By THOR KAMBAN BIBERMAN, The San Diego Daily Transcript