Dave Rice 12:38 p.m., May 21
San Diego Unified Raises Price Tag On Mission Beach Center
The starting bid for the 2.3 acres of beach and bayfront property in Mission Beach has just gone up.
If San Diego Unified board members decide to approve the sale of seven excess properties at a June 19 hearing, bids for the plot of land will start at $11 million, up from the $7.8 million that was initially proposed.
Things began to get heated at San Diego Unified after staff announced a proposal to sell seven excess properties at "fire-sale" prices. By selling the properties, the district hoped to raise approximately $25 million to help fill the $120 million shortfall projected for this coming fiscal year. School board member Scott Barnett went so far as to accusing district staff of "selling off the furniture to pay the mortgage."
After some weeks and many phone calls from critics, district staff decided to raise the starting price to $11 million, the low-end assessment from a May 2011 study by Jones Lang LaSalle.
According to one district employee, the price was changed after removing a condition that required an expedited escrow.
"We were a little overcautious with our conditions only because we wanted more bids," says one district staff member. "But we have since removed the condition of an expedited escrow and that is why the price went up."
And while $11 million will silence some critics, others continue to feel that the price is set way too low.
One local real estate broker claims the district has undervalued the Mission Beach property by $120 per square foot, and that's even with the recent adjustment.
"You're ready to give away capital assets that may be the only collateral available in the future to fund the Education for the future students and residents of San Diego..." wrote Cynthia Conger in a letter to San Diego Unified board members. "Easily, the sale of just Mission Beach alone could more than meet the District's current funding loss. Why is the District more interested at selling multiple school properties at low-ball prices at the peak of the annual market yet at the lowest point of this current...real estate cycle?"
But district staff responds by saying that is not the final price, only the minimum starting bid when, and if, the properties do go to auction.
"There is already so much interest in this property. We know the final bid will come in higher," said a district employee. "And as far as market-value, if this does go to auction then bidders will determine the fair-market value. There's too much interest in it for the district to not get what it is worth ."
"This all still needs to be approved by the board. Even after the auction is held the board must approve the final bid. There is still plenty of time to pull the plug on this. We are only in the beginning stages."
Board members will vote on whether to sell the seven excess properties, including the 2.3 acres in Mission Beach, at a June 19 hearing. Go to Sandi.net to view the upcoming agenda.