This story was reported for San Diego News Network on May 27, 2009.
With San Diego facing a water shortage and growing population, regional developers are fearful that their industry may face tougher days and stricter laws.
“My fear is that real estate development projects are going to get caught up in the middle until we work out these issues,” said Gary London, president of The London Group Realty Advisors. “I fear that the water issue is going to become the new nimbly issue, the new not-in-my-backyard-issue. The people that don’t want the development are going to say ‘ah hah we don’t want development because we can’t afford to give this new development the precious water that we have.’ They’re going to use that as a political issue.”
San Diego has hit highs and lows in terms of its development. The “high” took place in the 1990s but hit an all-time low in 2006 when the economy began its downward journey. Now local developers are concerned that the latest water crisis may keep them on the descending slope despite the number of projects that are taking water-conservation routes.
San Diego has been classified as the eighth fastest-growing city in the U.S. and in the past 20 years, the city has actually been constant with its water usage. Statistics show that water remains at about 250,000 gallons per acre-feet despite the city’s population growth. When it comes to single-family homes with lawns, however, the average water usage is 170 gallons compared to an apartment unit at roughly 80 gallons.
Most new San Diego developments have been sky-rises or multi-unit complexes. Bill Anderson, San Diego’s director of planning and community investment, said that the number of sky-rises is not meant to attract new San Diego residents and that the population growth is actually internal. In addition, Anderson said, this is actually a benefit in terms of the city’s water supply since small units tend to use less water than households with lawns.
“We’re recognizing that it’s better to be prudent and design our communities so that they are using less water than, say, communities did in the past,” Anderson said.
Local planning agencies were forced to consider water when approving projects beginning 1995 with the passage of California Senate Bill 901. However, in 2001 – water played a larger role for developers with the passage of SB 221 and SB 610. SB 221 prevents projects of 500 units or more from beginning construction without proof that a public water supplier has sufficient resources. While SB 610 alters the Urban Water Management Planning Act and the California Environmental Quality Act. The bill forces developers to show that the Urban Water Management Plan which is completed in five-year cycles for a 20-year-outlook, shows a sufficient amount of water is available for the proposed project.
One local project even has plans to develop an alternative water supply. Quarry Falls was approved by the city council on Oct. 21, 2008 and will build its own treatment plant that will recycle waste water. The project, as developed by Sudberry Properties, will be able to produce an immense number of gallons of water a day, said president Tom Sudberry.
“We’ll be able to create about 250,000 gallons of water a day, enough water to irrigate all of the landscaping of the entire project,” Sudberry said. “Fortunately, Quarry Falls is a big enough site that we can do that – some smaller deals that are done aren’t really big enough to make it economically feasible to make a water treatment plant.”
The project which will have 4,780 units is located in Mission Valley near Qualcomm Stadium along Interstate 805. Other than the consummate amount of units, the project is expected to have about 480,000 square feet of retail space, 420,000 square feet of office space and a High Tech High charter school. Sudberry’s project, headed by senior vice president Marco Sessa, has been labeled as the forefront of green development and the most water-friendly proposal.
And, Sessa said the current mandates for developers, in terms of water was easy to achieve and is reasonable as many development projects are ahead of the game when it comes to being green – at least for Sudberry Properties.
“There are water use requirements and I think the development industry is very far ahead of where things are,” Sessa said. “A lot of times we really focus on landscaping and some of our commercial centers, primarily, because there are current codes that mandate low-water use to begin with.”
Sudberry and Sessa said aside from the treatment plant, the entire landscape will be filled with drought-tolerant plants that are accustomed to dry weather, while other plants will be re-vegetated and won’t require a drop of water. In addition, the project will focus on using low-flush toilets and sub-meters for its units.
The sub-meters will allow each tenant to know the exact figure of gallons used per day rather than the entire complex sharing one meter, said Sessa. He said, sub-meters will allow water to be better managed among all residents and employees of Quarry Falls, so when a water mandate comes around again, individuals can examine their own water usage rather than depend on his or her neighbors to conserve.
Despite Quarry Falls’ efforts – not all developers can get a green star for its water efforts as many developments don’t install sub-meters. Statistics show sub-meters actually affect water usage, according to a report by the Environmental Protection Agency. The report found that a building that is sub-metered used 44.23 (sample size 100) kilo gallons of water per person compared to 52.19 in a building that had one meter.
“Sub-metering is a practice that offers documented water savings,” the report stated. “As such, sub-metering should be fostered by public policies seeking to encourage water savings, together with appropriate measures to protect the consumer.”
Mandating sub-meters is being considered by the city’s Natural Resources and Culture Committee said its’ chair, Councilmember Donna Frye. Frye, who is known for her passion for environmental issues, said among sub-meters, the city is contemplating whether the planning process is strict enough, when it comes to water.
“We have seen and approved of projects without addressing the water issues in the past,” Frye said. “There are projects that have abused and beyond our water supply. People need to have a realistic conversation about the existing business and economy and ask, ‘Can we assure them [current San Diegans] that as we grow and develop, we can supply all their water needs?’.”
However, Sessa said regardless of new buildings having sub-meters or not – older homes use more water than new buildings as older homes may, sometimes, have leaks that use a vast number of our H2O.
“The construction of a new home includes so many new water-saving features,” Sessa said. “One wonders whether more effort should be placed into retro-fitting some of the older homes.”
Additionally, he said developers in the past didn’t consider sub-meters because of its cost and because of the vanity of the building.
“It was less expensive to put in one meter and everybody shared that one meter,” he said. “The challenge on the condominiums is somebody has to watch those meters.”
Regardless of there being a small number of developers using sub-meters, London and Sessa are certain that most developers consider water immensely.
“You’ll see a scenario where new developments won’t create additional water demand because additional water demand is going to be offset,” Sessa said.
London also said the water qualifications for developers are more than sufficient.
“In a word it’s [water] very important [to developers] and it’s going to become more important as the years wear on,” London said. “It used to be it was never the test. Water was just a matter of plugging into the pipeline and you had water. Today, water is one of the discretionary issues.”
And, if the water laws are sufficient – the water problem being solved is completely contingent on the elected officials, London said. The real estate advisor said, he is surprised San Diego often finds itself in this predicament when desert-city-Phoenix has more water than they need.
“I think the better way to look at the water issue is not as a resource limitation,” London said. “We truly don’t have a shortage of water. What we have is a shortage of our ability to think creatively and act creatively and how we’re going to get more water to the consumers. All you have to do is look out the window and you see an ocean that is ready for desalination.”
“Ultimately this is not a water problem.”
Anderson agrees that water conservation is the issue.
“Everyone including new development is subject to any of the near-term water restrictions we’re all placed on,” he said. “It’s not whether it’s strict or not but should be more focused on conservations.”
However, when it comes to city officials, as a whole – conservation has not been the topic of any meaningful conversations, Frye said.
“I have not yet seen a serious discussion about it [water conservation],” she said.
Frye, who was the only councilmember to vote against the Black Mountain project on May 19, said her committee is looking into various ways to save water. Water-saving practices include Indirect Portable Reuse, ground water projects and adding more water storage – for which, she said can be far larger than what it is now.
Regardless of the route the city takes, water will remain an issue for developers, said Sudberry. Sudberry said his project leaders, who have devoted 8 years of their lives so far to the project, is even now reconsidering the “Falls” part of the project, which would eliminate their planned waterfall that will use recycled water.
“We’re rethinking even the name of ‘Falls’ and rethinking whether or not we can even have a waterfall in the development because of the water situation here in San Diego,” Sudberry said. “We had always plan on recycling the water that’s in the Falls in the back slope bank but even if you’re recycling, you still get evaporation from the water. So we’re very, very seriously re-considering that. It’s an amenity and feature that we always wanted to do but I think the practicalities of the water conservation issues we’re facing today will dictate that we got to be far more efficient.”
Hoa Quach is the political editor for the San Diego News Network.