The San Diego City Council voted unanimously Monday to advance three competing proposals for how to redevelop the 48-acre Sports Arena property in the Midway District.
Just last month, a council committee had signaled a preference to advance all five proposals, instead of cutting two of them from consideration. But all members had changed their minds by Monday.
Councilmember Stephen Whitburn explained that state housing officials had made clear the city must award the project to the developer who proposes the most amount of low-income affordable housing. If San Diego chooses a different project, it risks a repeat of the state overriding its selection and forcing it to start over.
"It's not clear to me that even if we evaluate all five, it will necessarily make the choice much clearer than it is today," Whitburn said. "And the more projects that we advance, the more time it will take and the more money it will cost the city."
The city now plans on hiring a consultant to help vet each of the three projects' financial feasibility in hopes of selecting a winning bidder by December.
Midway Rising, led by Encinitas-based developer Zephyr, is the clear favorite because it proposes 2,000 affordable apartments — more than the second-placed Hometown SD, led by the San Diego-based Monarch Group. The third project to advance is Midway Village+, led by Bridge Housing.
The two projects that were dropped from consideration are Neighborhood Next, which offered the most homes overall, if you include middle-income and market-rate housing, and Discover Midway.
City officials see the arena property as a potential catalyst for a broader revitalization of the Midway District, which has long been plagued by blight.
But the redevelopment will not pencil out unless the city is able to lift the 30-foot coastal height limit in Midway. Voters approved a measure to do that in 2020, but a judge last year blocked the measure's implementation, arguing the city had not sufficiently evaluated the environmental impacts of allowing taller buildings.
Mayor Todd Gloria is appealing that decision while also preparing a new environmental analysis that he hopes will satisfy the court's demands. Once that analysis is complete, he plans to ask the council to authorize a re-vote on the height limit question.
