SAN DIEGO MULTIFAMILY MARKET REPORT
Catalysts for Future Economic Expansion Preserve Strong Apartment Fundamentals
High-paying job growth supports leasing. Following a strong second half of last year, San Diego ranks as one of the nation’s tightest rental markets. From July to December, more than 4,300 units were absorbed in the metro, placing year-end unit availability at its lowest point since 2003. Hiring activity is to credit. Driven by the professional and business services sector, 52,500 positions were added during the six-month span, allowing San Diego to shed the fewest number of jobs among Southern California metros last year. Vaccination efforts and the county’s downward-trending coronavirus case rate have the potential to restore indoor business operations and bolster tourism in the near term. These occurrences would further boost hiring in the leisure and hospitality sector, which comprises workers with a high propensity to rent.
Life science sector positioned for near-term expansion. A collection of projects will elevate the metro’s number of well-paying positions and aid recent property performance issues in the urban core and La Jolla University City. A life science complex and the redevelopment of Horton Plaza into a tech hub are ongoing in downtown San Diego. Elsewhere, Scripps Health is upgrading its La Jolla and Torrey Pines campuses and a three-building bio-tech property is underway nearby. While homeownership may be attainable for life science professionals, home prices exceed $1 million in these submarkets, prompting individuals to rent.