CDF Key Takeaways – Jerry Sanders on The Future of Business in San Diego

CDF Key Takeaways – Jerry Sanders on The Future of Business in San Diego

What’s in the pipeline for San Diego?

  • Convention Center Expansion. This is important because it creates a $2B fund for homeless issues. Tax payers are not paying for this.
  • Mayor’s office is putting together a homeless plan for the city. Homelessness is not just a downtown issue any longer.
  • The mid-coast trolley expansion will allow for housing along the trolley lines. The marina area and Mission Valley will see housing growth more than other areas.
  • Until we get a handle on the housing issues, we are not going to be able to solve the homeless issues or the transportation issues with people commuting so far from work/home.
  • Cross Border Trade: Mexico has $60 billion in trade each year that comes through San Diego and 110,000 jobs are dependent on the border. Mexico is the number one trading partner for California and the number two partner for over 20 states.
  • A Cross Border Railroad that has been down since the 80s from Hurricane Kathleen is slated to reopen in Tecate into the U.S. This will take up to 5,000 container trucks off the road each year. Car Carriers will also be taken off the road.
  • The US Navy is continuing to shift ships to San Diego, adding about 20-25 in the next few years. One in four jobs is in the military and defense industry and 22% of San Diego’s GDP is based on the military. This gives us a competitive advantage.
  • SDSU West: This provides San Diego an opportunity to be transformative by adding another 15,000 students to SDSU.
    • In 2018, SDSU raised more money in one year than any other campus. Some of this is scholarship money which is helping more first-generation students than any other campus (exception may be CSU San Marcos).
    • The stadium will bring football, soccer, and other sports to the city and allows us to knock down Qualcomm stadium, which costs the city hundreds of thousands each year.
    • It will also bring 5,0000 units of housing for faculty, students, etc.
  • Apple and other big companies are looking to move some of their office space to San Diego.

Fireside Chat with audience questions being asked by Scott Stanton:

  • Whenever we see “Future of San Diego” articles, they are all writing about how many people are leaving California, but that’s not really what we are seeing/experiencing. You mentioned more people are likely coming here, which makes us think about housing, transportation, etc. How do we do this development in a way that is sustainable?
    • Density is a big topic. There are a lot of people opposed to new housing, but the reality is this is what will need to happen, especially on the trolley lines. Marina area, 30th Street, Adams Avenue, and El Cajon Boulevard are all getting built up.
    • Younger people are going without cars and parking is somewhat less of an issue, but we still need to provide parking spaces.
    • 163 and Friars are getting widened.
  • How do we get world class companies and world class talent to/in San Diego? UCSD has been a drive for this, but what other things can businesses, the county, etc. do to bring these businesses here?
    • Look to Austin as an example. It is much cheaper, they have a good environment and culture, yet when companies move there, we see them coming back because they cannot keep the talent. San Diego does not have this problem, but we do need the housing.
    • UCSD is up to 40,000 students. It has become so big and complicated and it alone creates a great need for housing.
  • To get the talent in town, you have to get the opportunities for families with children. With high density housing, what are we doing about making it work for families?
    • Middle-class housing is very difficult to build due to the city regulations, etc. Developers cannot get approvals for these developments (10% must be low-cost housing). High-end and lower end housing is much easier to build.
    • We are starting to see wide-range housing communities where they are putting all of it in one community with schools.
    • We need to allow these projects to move much more quickly. What is today a 6-year process needs to be brought down to about a 2-year process.
  • What about rent control?
    • We have opposed rent control because it stops developers from building housing. If you build more housing, the price naturally goes down. We need to focus on rent stabilization, where it only goes up 2-3% a year.
  • In San Diego, there is a lot of life science and technology. What do you think are the industries that are posed for more growth here?
    • San Diego used to be all about defense industry, but when that all started to leave, the city gave benefits for life science companies. For other industries, however, we are not a corporate Headquarters town. Our start-ups tend to sell to the big companies and they keep the location here, but they are not moving their headquarters here.
    • High Tech has a huge opportunity here and we are seeing a lot more of these companies coming already.
    • Manufacturing is leaving due to the high cost and regulation. Unfortunately, these were good middle-class jobs and this base will be hurt.
    • In general, San Diego doesn’t have great middle-class job opportunities.
  • Why are we not a focus for big California-based companies?
    • Sometimes California forgets that San Diego is part of California. The look to LA and the Bay Area, but forget about San Diego.
    • We need to embrace who we are and what we do have here. We have a lot of mid-sized companies instead.

Other Information:

  • People in San Diego do not like taxes. We are very “cheap” that way. We don’t have cell phone or utility taxes. We don’t pay for trash pick-up. To get the Convention Center bill passed, the City had to determine the biggest issues facing the city and then tied in those issues to the bill. These were road repairs and homelessness.
    • $600 M will go toward in road repairs
    • 7,000 full time jobs will be created from Convention Center expansion
  • Chamber of Commerce Today:
    • 23 of 29 people are women. Many are millennials.
    • It is bipartisan. The Chamber is traditionally believed to be old, white, republican men. They endorse half democrats, half republicans. The board is 50% women and diversity in general is a focus.
    • The City of San Diego has a different demographic than it used to. There is no republican district left in the City. Out of the 9 Council districts, none of them have a majority of republicans. This tells the Chamber they need to find business friendly democrats to endorse.
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