Hillcrest, Mission Hills, and Bankers Hill Multifamily Development Report
This area is attractive to both investors and residents alike as it boasts a convenient location between various parks, neighborhoods, and freeway access in the San Diego metro. The various amenities in this submarket draw a variety of tenants, which creates a diverse demographic and bustling community. Increased demand within the market has prompted the rise of multifamily rents here, along with an inflow of proposed and in-progress developments as investors use the market’s growth for profit advantages.
Balboa Park’s Market Performance
As of now, Class B and C properties remain the least vacant segments in Balboa Park. Landlords here have stated that many households are choosing to lease dated apartments instead of renovated facilities. This is likely due to the high cost-of-living in all of California, leading residents to areas that offer lower rents.
Residents looking to live in the metro will find that many apartments are offering concessions. This will allow for the vacancy rate to decrease as residents take advantage of these options. North Park, Bankers Hill, and Hillcrest have the highest rents in the metro. Yet, rental growth rates here have outpaced the area over the past 12 months.
Balboa Park stands out for its increase in development as around 1,100 units opened during the past year. However, deliveries here have mostly been for properties that have fewer than 30 units. Most of the developed inventory has been for one-bedroom and studio apartments to fit the smaller properties that are most common in this area.
Together with the increase in development, Balboa Park has also seen an influx of investors. Institutional and REIT buyers now make up 10% of the market share here. The largest sale occurred in the first quarter of this year for a Class A property. The Element, located in Bankers Hill, sold for $15.9 million. This facility includes 28 units, with an asking rent of $3,823 per unit.
Properties Under Construction
Onyx on Park
This property won’t be complete until May 2025, but it will add to the supply of luxury-tier apartments in the submarket. Onyx on Park will include 61 units, which are a combination of one- and two-bedroom units. The Class A property is a six-story building that will deliver 55,000 square feet.
4th & Hawthorn
Looking ahead to October, this Class B apartment complex will be a new addition to the mid-tier properties in Balboa Park. This specific property is located in Bankers Hill, aiding residents in search of lower rents in this traditionally luxury-tier area. The make-up of this property will have 21 one-bedroom units and 22 two-bedroom units.
Treehouse
The Treehouse development will add to the luxury properties in Bankers Hill. Construction is already underway and the property is expected for delivery in 2025. The mix of units is undetermined, but it will bring 107 new units to the area.
The Kaya
The Kaya will be a 78-unit midrise apartment complex upon completion next year. It will be located in Uptown, and will attract residents with its proximity to areas like Little Italy, Hillcrest, and the Gaslamp District.
Park Summit
Construction began in May for this facility, which is scheduled for completion in 2026. It will be a 21-story, mixed-use property with 265 apartments. The building will include one- and two-bedroom units.
The Rainford Project
This development broke ground earlier this year, and is expected for completion in summer 2025. There will be nine stories at this facility, with a total of 102 units. Tenants in search of studios, one- and two-bedroom apartments may look to this luxury property in Mission Hills.
New Development By KLR Planning
A new property is under construction on the corner of Washington Street and 6th Ave. KLR Planning will deliver an 18-story apartment complex that is made up of 418 units. Tenants in search of lower rents may turn to this property as 47 of the units will be designated as affordable housing. There is no estimated completion date or property name yet.
Recent Developments in Hillcrest, Mission Hills, and Bankers Hill
Sasan Apartments
This seven-story mixed-use building was completed last year. It boasts 54 residential units and three commercial spaces. The development aims to appeal to the needs of a wide demographic of income ranges, with units set aside for tenants who are not on par with the area’s median income, or cannot qualify for low-income housing. This development will ultimately contribute to fixing the housing shortage currently observed within the Mission Hills submarket.
The Harvey
The Harvey was delivered by Foundation for Form last year. This Class C property is located in Hillcrest. There are 64 units that make up the facility, with a mix of studio and one-bedroom units.
EVOC Hillcrest
This 82-unit Class A property was delivered last year with the goal of affordable housing and a location within walking distance of shopping, dining, and entertainment. More than half of the units here are one-bedroom units, with only five two-bedroom units. The average asking rent per unit here is $2,815.
Denizen
The owner of the Denizen, Carmel Partners, took advantage of an abandoned restaurant in Hillcrest to open an 8-story multifamily property. The complex opened earlier this year with 151 units. Tenants can look to this Class A property for a mix of studio and one- and two-bedroom units.
Uptown Lofts
Uptown Lofts is a 23-unit mixed-use multifamily property that offers 815 square feet of ground floor retail space. The building opened this year, and it features studios, one-bedroom and two-bedroom units. With its close proximity to restaurants, night life, and transportation, the property appeals to the active lifestyle of the Hillcrest demographic.
