San Diego State University (SDSU) has received approval from the California State University (CSU) Board of Trustees for two pivotal developments, marking a significant milestone in the university’s Mission Valley redevelopment. The approvals, granted during the Wednesday, Nov. 8 board meeting, include the green light for the first affordable housing project and a separate mixed-use residential and retail venture, according to information from the university.
For the residential and retail project, AvalonBay Communities will take the lead in financing, constructing, operating and maintaining the development. SDSU/CSU will play the role of landlord, receiving ground lease payments from AvalonBay.
The affordable housing project, to be developed by Chelsea Investment Corporation, is slated for construction on a parcel in the northeastern portion of the SDSU Mission Valley site. The seven-story building will comprise 186 dwelling units, with 184 designated as income-restricted units and two manager units. Targeting households with incomes averaging 50 percent of the area median income, the project aims to address the pressing need for affordable housing in the region.
The development will feature a 6,220 square foot child care center operated by Episcopal Community Services, showcasing a commitment to community well-being. Additional amenities include community resource rooms, a media center, outdoor lounge spaces and bike storage rooms with electric vehicle charging stations. The project is designed to achieve LEED Gold certification, underscoring its dedication to sustainability.
Chelsea Investment Corporation will leverage tax-exempt bonds, federal and state tax credits, and funds from the Infill Infrastructure Grant (IIG) program and Affordable Housing and Sustainable Communities (AHSC) program to finance the project. Notably, no subsidy will be received from CSU.
Upon Board approval, CSU and Chelsea will execute a disposition and development agreement outlining the key terms of the 75-year ground lease. Construction is scheduled to commence in March 2025, with occupancy expected in June 2027.
Simultaneously, the Board of Trustees approved a 99-year ground lease with AvalonBay for the residential and retail project. This mixed-use building will comprise 621 apartments and 30,000 square feet of leasable ground-floor retail space, including a grocery store.
AvalonBay, seeking funds from the AHSC program, plans to begin construction after June 2024, with occupancy anticipated approximately 24 months thereafter. Annual lease payments from AvalonBay, starting in June 2024, will be utilized by SDSU to make debt payments on revenue bonds secured in 2020 for initial site infrastructure and improvements.
These developments mark significant progress in the realization of SDSU Mission Valley’s long-term vision, complementing the opening of Snapdragon Stadium in 2022. SDSU is concurrently advancing toward completing 80 acres of park and open space, including a 34-acre river park set to be finalized by the end of this year. The university’s commitment to sustainable, community-oriented development is evident in these transformative projects.
