Seaport Village not dead yet with $2M in planned upgrades

A rendering shows how Seaport Village's property manager would like to turn dead space on the eastern side of the property into a public gathering area. (Courtesy, Gensler)

By Jennifer Van Grove, The San Diego Union-Tribune - Don’t forget about Seaport Village. That’s the message the Port of San Diego, which owns the 14-acre site, hopes to convey to the public through millions in right-here, right-now upgrades to the dated, waterfront retail center.

​Tuesday, the Board of Port Commissioners voted unanimously to spend more than $2 million on overdue site work, improvements to the village’s open spaces and a variety of entertainment features. The immediate allowances come as developer 1HWY1 works through the specifics of a $2-billion overhaul of Seaport Village and adjacent properties that will take at least five years to come to fruition.

“It’s also about … public perception that the Port of San Diego is doing the right thing, making the right decisions now, getting more people down there and really setting the stage for what is going to be … the largest development we’ve done in San Diego,” said commissioner Dan Malcolm. “It’s really the right thing to do in this area.”
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Specifically, the board’s vote directs port staffers to budget for an estimated $2,237,187 in work to be completed by Seaport Village’s management company Protea Property Management this year and in early 2020. The plan suggests $700,000 for necessary maintenance, $999,587 for physical enhancements to the property and $537,600 for programming of special events.

Advocating what’s called “tactical urbanism” — where cheap, near-term fixes will shape pricier, more far-off investments — Yehudi “Gaf” Gaffen, who runs both 1HWY1 and Protea, said funds would be applied to create kid- and adult-friendly gathering nodes.

For instance, in the food court region, or Carousel area, Protea is contemplating removing fences that wall off the property, as well as adding boats, rocks and playgrounds for kids to climb on.

“At Flower Hill, play areas attracted incredible attention from families, and we think this will really liven our front door,” he said, referencing the Del Mar promenade owned by Protea.

Other ideas in the works include turning the east side of the village, or the gazebo area as Protea is calling it, into a beer garden of sorts; incorporating local student artwork and adding equipment to support live performances.
“We see (the gazebo) as becoming a vibrant gathering spot for locals, but also a spot for music and performances,” Gaffen said.

While the still high-level concepts will be shaped into actual implementations at a later date, the board’s Tuesday vote signaled commissioners’ financial commitment to fighting the perception that Seaport Village is shutting down.
Opened in 1980, Seaport Village has seen brighter days as 24 percent of storefronts now sit unoccupied. In its heyday, the 90,000 square-foot specialty retail center at 849 West Harbor Drive was a surprise success, drawing crowds to a part of town that had been isolated from the rest of downtown.

The port assumed ownership of the site’s assets in October, taking over from previous operator Terramar Retail Center. It picked Gaffen’s Protea to manage the site in preparation for the transition to Seaport San Diego, which is the ambitious plan still working its way through the development approval process. The arrangement gives the port the bulk of revenue generated from Seaport Village shops and restaurants, but also requires the government agency to fund ongoing operations.

Currently, there are 57 tenants — 40 retail, 15 food and beverage, 2 office — and 18 vacancies. In the last three months of 2018, tenants generated $9.7 million in gross sales. The port makes money by charging a fixed rent to tenants, all of which are leasing their spaces on a one-year term.

The unconventional leasing structure matches the in-flux status of the site and was used as a stopgap measure to ensure that leases could be executed expediently during last year’s ownership transfer. However, it limits the port’s revenue prospects, as does empty stores. Right now, staffers anticipate $7.1 million in port revenue during fiscal 2019, which ends June 30.

“Avoiding the Horton Plaza effect, that ghost-town situation, is really important to me, because we are paving the way for the larger redevelopment,” said commissioner Rafael Castellanos said. “We need to make sure that people have a good feeling about Seaport Village and the Port of San Diego.”

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