Koll Plans $30-Million Project for San Diego

The Koll Co. said Wednesday that it plans to begin construction Dec. 1 on the first phase of a $30-million industrial complex in San Diego’s Otay Mesa industrial park.

The Newport Beach-based development company becomes one of the first builders in the 3,500-acre park, which sprawls along the California-Mexico border at Tijuana and is being developed to take advantage of the maquiladora or twin-factory program.

Under the program, U.S. companies export components to factories in Mexico for assembly and then import the assembled goods for distribution and sale in the United States. The U.S. companies--there are about 800 that manufacture goods under the program now--are able to take advantage of Mexico’s lower labor costs.

There are dozens of factories already in operation on the Tijuana side of the Otay Mesa, a total of 4.5 million square feet of manufacturing space on 1,000 acres, according to Michael Smith, a San Diego-based broker for Coldwell Banker.

Koll, in a joint venture with the San Diego office of Weyerhauser Mortgage Corp., purchased five parcels on the San Diego side of the mesa in January for $7.5 million, said William Porter, the company’s on-site development manager. He said Koll plans either to build on all five lots or to build on some and sell the others to companies that want to use their own development partners.

One Project Under Way

Ground has been broken on the mesa for only one building--a Sanyo refrigerator-manufacturing facility--since development was approved after the area was annexed by San Diego in May, 1985.

Koll’s initial project is the first in the industrial park to be built on speculation, with no specific tenant in mind. It will be a 146,000-square-foot building valued at $4.5 million, according to Porter, who said Koll intends to build a second, similar building by the middle of next year.

Parker Hannifin Corp., the Cleveland-based aerospace firm, intends to break ground in January for a two-phase building project of 125,000-square feet to house a hydraulic seals facility now located in Culver City, Smith said.

In addition to the industrial park, the Otay Mesa area has been planned for development of a major residential community of 17,000 homes, Smith said. Residential construction, he said, is scheduled to begin in mid- to late-1988.