Business leaders optimistic about 2015

From Encinitas to Escondido, local experts see diversity as economy’s best asset


From an upturn in housing to stable city coffers, local observers of the economy anticipate a positive 2015. (stock.xchang)

Alex Groves

With 2015 underway, officials in North County say they see good things in store for business and the region’s economy overall.

But in spite of noticeable gains in sales tax revenue, increases in chamber of commerce memberships and other tell-tale signs of a prosperous economy, some leaders in the region say that challenges with space and attracting higher-paying jobs still remain.


Encinitas Chamber of Commerce CEO Bob Gattinella said he sees positive economic developments on the horizon for Encinitas. He pointed to increases in wages and a prevalence of office businesses in the city as signs that 2015 will be a good year.

“From everything that I’m reading about and seeing in trends, I think this is going to be a much better year than 2014,” Gattinella said. “Wages are going up; I think people are going to be buying more, I think they’re going spending more time in hotels, I think it’s going to be a good year for everyone.”

Moreover, Gattinella said, North County as a collective region is doing quite well when compared with other parts of the state and country at large. He pointed to a burgeoning biotech industry as proof of that.

“(San Diego County’s biotech) is just doing fantastic work with all the new procedures and medicines that they’re bringing to market and bringing to trials,” he said. “We’re the second or third biggest biotech region in the country, but if you were to pair our biotech with what we have over the border in Baja, then together we’re the largest area in maybe the world of biotech.”

Gattinella also pointed to a growing craft brewery market in San Diego, saying that regional breweries are having their craft beers shipped to the East Coast and Germany.

“Unfortunately, in Encinitas, we have no biotech or breweries,” Gattinella said. “But we do have a blue water income and tourism, and when people come (to North County), hopefully they stay here. I think it’s going to be a good year for everyone.”


Another city in the region looking to capitalize on the growing biotech industry and craft beer market is Escondido.

Escondido Chamber of Commerce CEO Rorie Johnston said the city is still trying to drawn in some higher-paying jobs and has enacted long-term plans to do that.

Planned efforts to attract higher-paying, larger businesses have been outlined in Escondido’s Comprehensive Economic Development Strategy, a plan drafted in 2013 and approved by city officials.

The plan aims to grow business and expand the city’s tax base through a number of projects and programs.

Johnston said the primary area where she’s seen growth has been in Escondido’s medium-sized business market. Service businesses and family-owned businesses continue to grow and expand in Escondido, she said.

Escondido has two craft breweries — including the well-known Stone Brewing Company — and three vintners. Johnston said she would like to see Escondido continue to grow as a hub for fine dining and sophisticated beverage choices.

“To be able to capitalize on that, or to have our foot in the market as well, is very viable,” Johnston said. “It’s a destination, and if people are coming here to enjoy a glass of wine, they will come here to enjoy other things as well.”

“If people are searching out a type of product, then we want that type of product here,” she added.

In the meantime, however, Johnston said the chamber’s growing membership is at least reflective of growth that’s already happening.

“We’ve definitely seen an influx of businesses joining us who are new businesses in town,” Johnston said. “We’ve seen a return of businesses who were members before, but who had fallen off during the slow economy and are now coming back. And then we’ve remained fairly stable with our current businesses. Overall, we are seeing growth here at the chamber.”


One North County city to boast growth in both its high-paying jobs and service industry jobs is Carlsbad, which continues to profit from tourism and hotel patronage as multimillion dollar projects come to fruition.

Ted Owen, president and CEO of the Carlsbad Chamber of Commerce, said he has seen steady growth at his chamber, which is the second largest in San Diego County. He said the chamber currently hosts more than 1,500 members and that business appears to be booming.

“The economy itself, in Carlsbad, has been on a pretty good cycle for quite a while actually,” Owen said. “We’re about to open four new hotels, a billion-dollar desalination plant which opens this fall, we’re about to start tearing down our power plant to build a new $750 million power plant, were building 750,000 single-family homes at the current time, two new fires stations … The list is pretty long in Carlsbad.”

Owen said the construction and opening of four new hotels will be a big financial boost to the city, which made $16 million in transient occupancy taxes (TOT) from its current slew of hotels. New construction means that sum can only go up in the new year, according to Owen.

“Those hotels, if their projections are met, will be adding another 600 rooms to the hotel inventory,” he said. “So if they’re 60-70 percent occupied, hopefully higher than that, then they’re going to create another million dollars or more in TOT.”

“I think we’re doing pretty well,” Owen said of the economy within Carlsbad, “or else we wouldn’t be growing.”

Solana Beach

Solana Beach’s Chamber of Commerce also boasts a large membership, according to President Carolyn Cohen.

“Over the past two and half years, since new leadership took over, the Solana Beach Chamber of Commerce has grown by leaps and bounds,” Cohen said, adding that the chamber went from having a membership of 141 to about 322 over that time period.

Solana Beach Chamber of Commerce Executive Director Nicole Peterson said that part of the growth the chamber has experienced has to do with the many events it holds. Events such as Taste of Solana Beach and Fiesta Del Sol allow various businesses from the greater Solana Beach area to network with one another, she said.

“We look to foster growth between the businesses in cross promoting with other business and connecting them with the community, making sure the community is aware of the services in their backyard,” Peterson said.

Although Cohen said she couldn’t speak to the success of business in the region, she said she does believe Solana Beach benefits from a diversity of businesses, from restaurants and shops to office businesses and healthcare services.

Solana Beach Mayor Lesa Heebner said an increase in sales tax revenue suggests that more people are visiting Solana Beach’s eclectic mix of restaurants and shops. She said Solana Beach, unlike its counterparts, isn’t trying to draw in higher-paying jobs and high-tech industries.

As a smaller town with a limited amount of space, Solana Beach is more interested in drawing in the spending dollars of its residents and occasional visitors, she said.

Housing as an economic barometer

Cal State San Marcos professor Robert Brown, author of the North County Association of Realtor’s Homedex Report, said home prices aren’t increasing with as much ferocity as they did at this time last year. However, he said the housing market remains stable with moderate and consistent price growth overall.

The median housing price in December 2014 saw a nearly 6 percent increase from December 2013, Brown said.

He said the steady growth in home prices has been the result of a blossoming economy in North County as the region begins to get back many of the jobs it lost during the Great Recession.

Brown said that while other parts of the country struggle to find their bearings after the recession, San Diego County is already getting a jump-start because of its diverse economy.

In other words, while other areas may be primarily agricultural or tech-based, San Diego County boasts a wide variety of industries.

Service industries, restaurants, breweries, healthcare industries, farms and other revenue-makers are what San Diego County is composed of, while other parts of the country may be reliant on only one of those industries.

If a particular industry is negatively impacted in San Diego County, the county can rely on its other money-makers. Regions where there is only one form of industry, however, may have a harder time if that industry is affected in a recession, according to Brown.

“I think our economy is fairly well diversified across the different economic sectors,” Brown said.

San Diego County’s diversity is allowing it to come back from the recession relatively unscathed; as more people find higher paying jobs, more people are buying houses, Brown said.

Brown said he anticipates slow but steady growth over the coming months, but it may be too soon to make an absolute statement on whether that will be the case. Winter months such as December are usually slower for real estate.

“The spring will be the real indicator of what’s happening,” Brown said.

Alex Groves is a freelance writer in the region