I.D.E.A. District

Innovation District Would Transform Region

“The challenge that leaders face now is how to trigger ‘brain gain’ in their cities. Talent is an incredibly valuable commodity because it is at the core of entrepreneurship and innovation. It’ s the extreme differentiator of all mankind. And talent attracts more talent.” — Jim Clifton, “The Coming Jobs War”

Some 60 years ago a consortium of San Diego civic and business leaders, educators, politicians and voters came together to support the establishment of the University of California, San Diego on what was city land, the former Marine Corps Camp Matthews and adjacent La Jolla property. Despite naysayers — and developers who would have preferred the quick rewards of oceanfront home sales — UC San Diego opened in 1960 with 20 faculty members. Thanks to civic foresight, San Diego has been transformed into a world-renowned biotech and scientific research center, and tens of thousands of high-paying jobs have been created on Torrey Pines Mesa.

Today, downtown San Diego is facing a similar once-in-a-generation opportunity that will impact the future of our region in the 21st century — the redevelopment of Upper East Village. It can become a vibrant innovation district that attracts cutting-edge firms, young talent, students and “creatives”; or, it will surely convert — by default — into one more sea of apartments and condos. Sadly, downtown is already becoming a vertical bedroom community — 78 percent of downtown residents commute out of downtown to work. Over the past 15 years, while 20,000 residential units were completed, net job growth was zero. A visionary high-tech business leader is needed now to show that there is a smarter way.

Bringing in the Brainpower

The key to redevelopment success in East Village is creating an ecosystem that supports clean, high-paying jobs and attracts what social scientist Richard Florida calls the “creative class” — the fast-growing, highly educated and well-paid segment of the workforce on whose efforts corporate profits and economic growth increasingly depend. Those workers demand an integrated work-life environment with ethnic and cultural diversity and easy access to nightlife, recreation and collaboration. Cities that understand this dynamic — such as Denver; Austin, Texas; and Portland, Ore. — are thriving because they recognize that building a vibrant city is their most effective economic development strategy.

Two and a half years ago, 50 civic and business leaders participated in a workshop that was the first step in transforming a 35-block area of Upper East Village into a sustainable, mixed-use district dubbed the I.D.E.A. District — representing innovation, design, education and art. It has since gained broad-based support. This concept could generate 10,000-plus high-paying jobs and more than 6 million square feet of commercial and residential development, and support a lively scene of restaurants, retailers, galleries and entertainment. The potential for job creation is demonstrated by design and tech-oriented districts in Barcelona, Spain; Boston; and South of Market in San Francisco, where top-end designers and creators can earn six-figure salaries.

Winning the ‘Jobs War’

Jobs are at the core of I.D.E.A. District. In “The Coming Jobs War,” Jim Clifton, chairman and CEO of Gallup, maintains that “the biggest problem facing the world is an inadequate supply of good jobs” and that

“cities must make creating good jobs their No. 1 mission and primary purpose because good jobs are becoming the new currency.”

As Florida recently noted, tech jobs are moving from the suburbs to the city. Clifton and Bruce Katz and Jennifer Bradley, the two authors of “The Metropolitan Revolution,” point to gritty urban locations near institutions of higher education as ideal locales for innovation districts.

San Diego’s East Village already has key institutional anchors that will help facilitate transformation, including The NewSchool of Architecture and Design, Thomas Jefferson School of Law, San Diego City College, The Fashion Institute of Design and Merchandising and the new Central Library. It also possesses a combination of physical factors that make it ripe for reinvention — nearby transit, walkable blocks, older underutilized buildings, planned public spaces and land available for development. Perhaps most importantly, full entitlements with appropriate zoning and density are already in place.

The goal of I.D.E.A. District is to utilize these assets to establish a vibrant innovation ecosystem that leverages a rich social environment with thoughtfully designed spaces for living, working, playing and learning. We believe, and the evidence supports, that fashioning a place and a culture that maximizes collisions between diverse, talented people will facilitate serendipity and foster the collaborations that spark new businesses.

The Missing Piece

The migration of technology to downtown has started to take hold. In 2013, 25 percent of the new downtown leases, many of them tech companies, were executed by companies coming from outside of downtown, versus 2 percent in 2010. But the missing piece is a corporate leader who can accelerate the transformation. In Seattle, Amazon.com’s relocation to South Lake Union has produced an extraordinary economic engine; in Las Vegas, Zappos’ move downtown, led by Tony Hsieh, has energized a moribund area with art, food and a vibrant startup scene.

Once a marquee company becomes an early adopter in I.D.E.A. District, satellite businesses will surely follow. But to change the trajectory of Upper East Village from residential to truly mixed-use, a visionary corporate leader is required. The stakes are huge. This prime land and the fashion in which it is developed will have a profound impact on the future and fortunes of the San Diego region, as well as the companies that seize this opportunity.

 

By Pete Garcia, David Malmuth and Mike McNerney Saturday, February 8, 2014

Pete Garcia and David Malmuth are principals of I.D.E.A. Partners. Mike McNerney is a senior vice president and shareholder of Lowe Enterprises, responsible for commercial operations in San Diego, Orange County and Phoenix.