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Home / Articles / News / News /  Developer vs. developer
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Tuesday, Jun 03, 2008

Developer vs. developer

H.G. Fenton funds campaign to stop Sudberry’s big Mission Valley development

By David Rolland

It’s not every day that one real-estate developer bankrolls a public offensive against another real-estate developer, but that’s what’s going on in Mission Valley, where two San Diego-based firms are engaged in a high-stakes battle over 230 acres of land north of Friars Road.

For more than six years, Sudberry Properties has been working on an ambitious plan to develop land currently used for rock mining into a new community called Quarry Falls. Proposed for the site—which is bordered by Interstate 805 to the east, Mission Center Road to the west, Friars Road to the south and Serra Mesa to the north—are 4,780 homes (only 100 of which would be single-family dwellings), 603,000 square feet of retail space, 620,000 square feet of office space, nearly 32 acres’ worth of public and private parks and a charter elementary/middle school affiliated with High Tech High.

At full build-out, which would be phased in over 15 years, Quarry Falls is expected to increase the population of Mission Valley by more than 12,000.

Sudberry entered into an agreement in 2002 with the landowners, the Grant family (no relation to nearby Grantville), to develop the site and has been working with citizen planning groups—most intensively in Mission Valley and Serra Mesa—ever since. But seemingly out of nowhere, in early 2007, came the H.G. Fenton Company, long a major player in the Mission Valley real-estate game, with complaints about traffic.

The conversation started with a voicemail left on a Sudberry telephone and turned into face-to-face talks, said Marco Sessa, Sudberry’s vice president for development.

“We thought we were at a good place,” Sessa said. But then nine months later, the day before Sudberry was scheduled to make a presentation in front of the Mission Valley Unified Planning Committee’s Design Advisory Board, Fenton “showed up with consultants, with PR guys, attorneys—you name it—coming after us. We’ve been at odds ever since.”

Now, H.G. Fenton is funding a group called San Diegans for Responsible Planning (, a “citizens coalition” of Quarry Falls opponents coordinated by Katie Keach, who has in the past served as spokesperson for former City Councilmember Mike Zucchet and the city firefighters union and is currently working for District 3 City Council candidate Todd Gloria. Fenton’s team also includes Dave Potter, former chair of the Community Planners Committee (made up of chairs from community planning groups citywide), whose job was to pick apart the project’s environmental-impact report, as well as the PR firm The Grove Agency. Fenton’s also been stocking up in 2008 on firms that are registered as lobbyists with the city: Southwest Strategies joined in January, the law firm Wertz McDade Wallace Moot & Brower in April and MNA Consulting in May.

Several sources CityBeat spoke to said that such developer-on-developer action is rare in San Diego and found the situation politically intriguing. They could only speculate as to Fenton’s motives.

“If we had a good reason and understood why they’re doing what they’re doing, we would have come up with a solution,” Sessa said. “The last thing I want to do is be in the fight that we’re in. What they told us is that there’s an increase in traffic and we’re going to mess up the valley.”

That’s the story Team Fenton’s sticking to.

“This project exceeds the intensity of traffic as allowed under the community plan in Mission Valley—by more than double,” said Sandy Grove of The Grove Agency. (It should be noted that the degree of traffic impact is a matter of dispute among the parties, involving planning formulas and semantics.)

Fenton’s “concern is that one developer is not working within the community guidelines,” Grove said. “The community plan, it’s my understanding, as it exists, was a compromise, and with the [Quarry Falls] plan as proposed by Sudberry now, the infrastructure will not support it. And so you’ve got a community where [Fenton] and other developers, other property owners, have customers—there are residents that are going to have to live in this area, and if suddenly it doesn’t work efficiently, this wonderful area is compromised.”

The environmental-impact report for the project concluded that the Quarry Falls project would result in “significant impacts” to local traffic. Though the majority of the problems can be mitigated, the report concluded that nothing could be done to alleviate congestion on some of the already congested streets, intersections and freeway segments in around Mission Valley, such as the 163/I-8 interchanges, the Friars Road to Genesee portion of the 163 North and South, the I-15 North and South at Friars Road and the I-8 off-ramps that take people to popular Mission Valley strip malls.

Quarry Falls would indeed require changes to the Mission Valley Community Plan, which guides growth and development in the area and was last updated in the mid-1980s. In exchange for allowing more car trips than the community plan calls for, Sudberry would contribute money toward transportation improvements in Mission Valley; for example, the company would pay $20 million toward a $140 million rebuild of the Friars/163 interchange and widen the Mission Center Road bridge over the 8. “At the end of the day,” Sessa said, “we are doing work on the five freeway interchanges surrounding Quarry Falls—so that’s Friars/163, Mission Center and 8, Qualcomm and 8, the 15 and Friars and Phyllis Place and I-805 above the site.”

A source at City Hall familiar with the proposal said Fenton’s complaints are peculiar in light of the fact that about a decade ago, Fenton proposed and received a similar amendment to the community plan when it developed Mission City, a large-scale project in Mission Valley that, like Quarry Falls, included retail, office and residential components.

Part of Mission City was Fenton Marketplace—home to Ikea and Costco, among other stores. Ironically, though Fenton was the overall developer, Fenton Marketplace was developed by Sudberry, which chose to name the shopping center for the H.G. Fenton Company.

“It’s very interesting when the developers start having reason to fight each other,” said environmental attorney Marco Gonzalez. “I think it’s a reflection that something has gone awry, most likely in past planning efforts, but the impacts are coming to bear now.

“H.G. Fenton probably rode high on the hog for a number of years with respect to the mitigation obligations it had for its own developments,” he added. “The reality is that you wouldn’t have the impacted condition you have currently in Mission Valley if developers had had to pay their way for the traffic infrastructure, but they just didn’t.”

Gonzalez has been monitoring the Quarry Falls planning process on behalf of the group Save Our Forests and Ranchlands and is concerned that the city has forced Sudberry to spend energy and money on auto-oriented improvements that would be better spent on public transit. Sudberry is marketing the development as part of the cure that ails growing communities grappling with urban sprawl, touting its conformance with concepts like San Diego’s City of Villages, which seeks to locate housing near jobs and reduce reliance on cars. A trolley line is a reasonable walk away from the site.

Potter, who reviewed the project’s environmental-impact report (EIR) on behalf of H.G. Fenton, found plenty to criticize—for example, Sudberry’s overstating the number of car trips that won’t leave the site’s boundaries, he said—but he doesn’t blame the developer. The city’s Development Services Department (DSD) has been far too lenient for far too long when it comes to forcing developers to effectively mitigate impacts on public infrastructure.

During a community planning meeting Potter attended, he said he remarked that certain impacts on public services probably weren’t addressed in the EIR because DSD staff directed the consultant writing the EIR not to address them. “The consultant concurred with my remark. The very same thing occurred on the EIR for the controversial Regents Road Bridge project when staff directed the consultant to remove the discussion on public facilities and services from the EIR,” said Potter, who reviewed the Regent Road Bridge environmental documents on behalf of a citizens group that wanted the bridge.

Potter wasn’t certain about whether or not H.G. Fenton plans any more development in Mission Valley, and Grove did not answer that question, which was posed in an e-mail and a voice message (Fenton’s vice president for development, Allen Jones, was out of town and unavailable for comment).

In any case, Fenton now finds itself on the other side, playing the role of the environmental activist. CityBeat showed a copy of Fenton’s 21-page critique of the Quarry Falls EIR to former Planning Commissioner Carolyn Chase, and she remarked that Fenton’s comments “read as if they were written by a well-funded environmentalist.”

Chase wonders if Fenton’s opposition could have farther-reaching impacts on future development elsewhere in San Diego. The issues Fenton’s raising, she said, could apply to any developer wanting to go with what’s known as a “programmatic EIR,” where a project review is based on different scenarios without a precise building plan. Such an approach wouldn’t be as worrisome in a city where infrastructure needs keep up with development.

“But alas,” Chase told CityBeat in an e-mail, “the transportation, parks and public safety planning and funding is woefully behind in Mission Valley—as it is in most if not all of the region’s prime locations (Golden Triangle, downtown, I-15). What we really need is better regional transportation planning for all these areas.”    

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