Daily Business Report-Oct. 6, 2015
The analysis said the 12th & Imperial Transit Center performed best overall within the San Diego region.
San Diego’s Transit System
Stations Rated Worst in State
Transit stations operated by the San Diego Metropolitan Transit System have been judged the worst of the state’s six major rail transit systems for such qualities as ridership and proximity to job centers, while its Gillespie Field Station was graded the lowest overall in the state.
The analysis of California’s rail transit system was issued by the nonprofit nonpartisan group Next 10 and prepared by the Center for Law, Energy and Environment at the UC Berkeley School of Law.
The MTS said in response that the analysis was not an assessment of overall MTS performance, but an assessment of the location of its train stations. It said the true measure of its system performance is its growing ridership and high customer satisfaction.
The analysis assigned a grade to each of the 57 stations in the San Diego Metropolitan Transit System, finding that the system’s average score for its station areas tied for worst among the state’s six major rail transit systems with the Santa Clara Valley Transportation Authority.
“Top-performing transit stations tend to be located in the center of downtown-like environments and thriving, rail-oriented neighborhoods. These stations provide access to housing, shopping, places of work and other amenities,” said Next 10 founder F. Noel Perry. “Most low-performing stations are on the outer edges of rail systems, often situated in low-density, industrial or auto-oriented neighborhoods.”
The Gillespie Field Station was not only at the bottom in the MTS but graded the lowest overall in the state. “The area draws almost no transit use among residents and workers and is situated in a heavily ‘car dependent’ area not conducive to transit-oriented development,” the analysis said.
Eight San Diego MTS stations were assessed failing grades, primarily for low ridership and lack of access to attractive amenities.
The analysis said the 12th & Imperial Transit Center performed best overall within the San Diego region. However, its overall B grade is much lower than the best-performing stations in the five other transit systems graded.
The station benefitted from its location in a downtown, walkable environment with access to significant destinations and job centers, but scored lower on ridership, safety and the level of auto dependency in the neighborhood.
“The scorecard prepared by the Center for Law, Energy and the Environment at UC Berkeley provided just a narrow scope of measurements related to MTS operations,” the MTS said in a statement. “It is not an assessment of overall MTS performance; rather an assessment of the location of our train stations. The criteria used is largely outside the control of MTS. This scorecard examined the results of years of land-use planning as it used criteria such as walkability, land-use and permitting policies, and affordability.”
The MTS also noted that the system enjoys exceptionally high customer satisfaction — 92 percent. “That fact, combined with our growing ridership, is the true indication of our system’s performance, it said. “The trolley system broke a ridership record of more than 40 million trips last year, which equates to more than 100,000 riders every day. In addition to suburban neighborhoods, the Trolley provides excellent service to all Downtown San Diego businesses in highly walkable, accessible and convenient locations.”
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Report: El Niño Could Have Widespread
Economic and Physical Impact in SD County
A severe El Niño winter storm could have widespread economic and physical impacts on San Diego County, according to a study by the National University System Institute for Policy Research released today.
The institute said it examined the potential for damage and disruption and found that:
• Recent severe El Niño storms caused $804 million (1997-98) and $2.04 billion (1982-83) in economic losses in California.
• Nearly 55,000 county residents live in areas that are more suspectible to flooding during flood events.
• Countywide, nearly 5,000 businesses are located in areas that are more suspectible to flooding during flood events.
• Tourism and agriculture are two economic sectors that are most likely to be affected by severe El Niño storms.
Surprisingly, El Niño may generate some positive economic benefits, but most are limited to regions that typically experience colder winters and snowfall during the early months of the year, according to the institute.
“The weather conditions this winter are unknown, but there are clear repercussions for the regional economy,” saidVince Vasquez, senior policy nalyst and author of the report. “Given the history of El Niño disasters, storm preparedness by local governments, proprietors and home owners is essential this season.”
The report can be found online here.
Navy Awards First Coastal
Campus Construction Projects
The Navy awarded more than $90 million in contracts to three construction companies, marking the start of the Naval Base Coronado Coastal Campus projects at the Silver Strand Training Complex South.
The projects are part of a new $1 billion complex for the Navy SEALS, which would add 1.5 million square feet of development along the Silver Strand.
The first project will begin this month with the demolition of the World War II Coastal Battery Bunker.
The following projects were awarded:
• A $1.7 million contract to True Champions Inc. for the bunker demolition and construction of temporary structures.
• A $53.3 million contract for single and two story administrative, training, and warehouse facilities to RQ-DPR JV Construction. Construction is expected to begin in summer 2016 and end in spring 2018.
• A $26.6 million contract for single and two-story operational and logistics facilities and a $9.3 million contract for a single story communication facility to Solpac Construction Inc. / Soltek Pacific Construction Company. Construction is expected to begin in summer 2016 and end in spring 2018.
The Navy said the new facilities will enable operators to train in close proximity to their current duty station, resulting in reduced training costs as well as improving quality of life for Naval Special Warfare personnel and their families.
Investment Banks Downgrade Illumina
Following Lowered Revenue Forecasts
BTIG and Mizuho Securities downgraded shares of Illumina, while other investment banks cut their revenue estimates and price targets for the company’s stock, following Illumina’s preannouncement on Monday that it has lowered its revenue forecasts for the third and fourth quarters, as well as full-year 2015.
BTIG lowered its rating on Illumina’s stock to a Neutral rating from an earlier Outperform rating, while Mizuho downgraded the firm’s shares to a Neutral rating from a Buy rating. BTIG also cut its full-year 2016 EPS estimate for Illumina to $3.83 from $4.19, while Mizuho dropped its price target on Illumina’s stock to $150 from $250.
The action was prompted by Illumina’s preannouncement that its third-quarter revenues are expected to grow to $550 million, which would be a 14 percent increase year over year but short of analysts’ average estimate of $568.6 million. The company also said that Q4 revenues are expected to be $570 million, which would be short of the consensus Wall Street estimate of $602.8 million. Full-year 2015 revenues are anticipated to reach $2.19 billion, which would be an 18 percent uptick from $1.86 billion in 2014, but below analysts’ average estimate of $2.25 billion.
BTIG analyst Dane Leon said that downgrading a company’s stock after a preannouncement is generally “the wrong move,” and he remains positive about the San Diego company’s long-term outlook, but his revised 2016 forecasts “are not currently supportive of a high-growth multiple for the stock.”
New City Planning Director Featured
At Urban Land Institute Program
Urban Land Institute San Diego/Tijuana District Council will host a one-on-one conversation between San Diego’s newly appointed Planning Director Jeff Murphy and Greg Shannon, chair of the council. It will be staged on Oct. 13 at 7:30 a.m. at the University Club atop Symphony Towers Downtown.
Murphy is the former planning director for the city of Encinitas. He now leads a department with a $10 million budget, 67 full-time employees and oversee 52 community planning areas and 42 community planning groups.
Prior to his arrival in Encinitas, Murphy worked for the county of San Diego for 13 years. Before working for the county, he was employed by the accounting firm KPMG in San Diego.
Tickets for the program range from $35 to $70. Registration after Oc. 8 will be handled at the door and include a $10 fee.
For more information or to register, visit www.sandiego.uli.org
San Diego Receives $2.75M Grant
For Improvement Projects
City News Service
The city of San Diego announced Monday that it received a $2.75 million grant from the San Diego Association of Governments to fund seven projects.
The money will be used by the city and its development arm, Civic San Diego.
According to the city, the awards include:
• $1 million to pay for the design and construction of the first block of a promenade along 14th Street that will link City College with Barrio Logan.
• $400,000 to restore Alvarado Creek, and make it easier to walk or ride bikes between developments and the Grantville Trolley station.
• $400,000 to expand open space and beach access in Pacific Beach, and make improvements to the boardwalk.
• $350,000 for new directional signs to services, transportation and destinations at the San Ysidro Port of Entry.
• $300,000 to finalize a streets plan for the Euclid and Market Community Center.
• $200,000 to study the feasibility and come up with a conceptual design for an enhanced pedestrian walkway along Sixth Avenue between Downtown and Balboa Park.
• $105,000 to update the land-use and zoning strategy in Kearny Mesa, in order to heighten the area’s employment potential and identify suitable areas for transit-oriented development.
Third Time’s the Charm for
La Jolla Shores Mixed-Use Project
City News Service
The San Diego City Council on Monday certified the environmental impact report for a proposed La Jolla Shores mixed-use project, following two previous attempts that were rejected.
The approval, on a 6-2 vote, is a major step forward in plans by area residents Bob and Kim Whitney to demolish a pair of single-story buildings in the 2200 block of Avenida La Playa and construct a three-story building — with retail on the ground level and two condominium units above.
The proposed project was approved by the Planning Commission in 2010, but an appeal was upheld by the City Council. The Planning Commission backed the project again the next year, but the council rejected it a second time because of concerns about environmental impacts.
Since then, the developers revised their plans and conducted another environmental study, which the Planning Commission approved in April, according to a city staff report.
The La Jolla Community Planning Association, a group called La Jolla Shores Tomorrow and three individuals appealed the commission’s action to the City Council, contending the project still violates neighborhood design guidelines and setting out numerous other objections.
Julie Hamilton of La Jolla Shores Tomorrow said the planned structure will be too big for the area’s “1960s-70s vibe.”
A more specific concern from a woman who lives adjacent to the property is a proposed 65-foot-long, 30-foot-high wall next to her residence that would block light and ventilation.
San Diego ASID Elects President
Interior designer and educator Natalia V. Trepchina-Worden has been elected president of the San Diego chapter of the American Society of Interior Designers for the 2015-16 term.
Trepchina-Worden is owner of N.T. Worden Design, which specializes in residential design. She also has been teaching interior design at San Diego State University since 2002. Her educational background includes a master’s degree in architecture from the Ural Architectural Academy in Russia. She also has a master’s degree in art with emphasis in interior design from SDSU.
The 2015-16 ASID board of directors also includes Lena Brion, president-elect; Amy Ramirez, Industry Partner, financial director; Kate Lindberg, director of professional development and programs; Gerald Bouvia III, at-large director; Faye Fentin, director of membership; Jill Winninger, director of communications; and Nataly Ozuna, student representative to the board.
Personnel Announcements
Mike Reynolds Joins Chamber as CFO
Mike Reynolds has joined the San Diego Regional Chamber of Commerce as its new chief financial officer.
Reynolds formerly was senior vice president, finance and administration, and chief financial officer at ClosingCorp. Inc. in San Diego. ClosingCorp is an early stage technology-enabled service provider of real estate data to the financial services industry.
Before joining ClosingCorp, Reynolds held similar leadership positions at ProfitLine Inc., SeminarSource, and WebSideStory Inc. He has served on the boards of Voices for Children, Junior Achievement, Pacific Beach Town Council, and The Gillespie School. At Voices for Children and The Gillespie School, Reynolds served as treasurer and finance committee chair.
