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The San Diego Unified School District’s deal to sell Bay Terraces No. 11, a plot of undeveloped land in southeastern San Diego, has fallen apart.

Ivar Leetma, one of the partners who signed a deal to buy the property from the district for $3.1 million last year, said Friday he and his partners have dropped out.

“We’re pulling the plug,” he said.

Leetma didn’t want to elaborate on the decision to pull out. Under the contract with the school district, the buyers had until Sunday to back out of the deal without losing their good-faith deposit.

The Bay Terraces deal was one of a couple of real estate sales we examined in this story Thursday. The district could be leaving millions of dollars on the table by selling the plot before it is up-zoned to allow for far more properties to be built there. The cancellation of the pending sale clears the way for the district to take that path if it chooses.

But Trustee Scott Barnett doesn’t think his colleagues on the school board will seize the opportunity.

“I’m sorry to say that I think they’ll just drop the price even further,” Barnett said.

The Bay Terraces site is the third big real estate deal to fall apart at the district in recent months. Last year, the board voted to sell the Mission Beach Center, a property a block from the beach, but the board scuttled the deal a couple of months later. Another land sale in Tierrasanta was also ditched by the board after the community opposed the sale.

Without the sale of the Bay Terraces site, the district now needs to find another $3.1 million to plug into its ailing budget next year.

That’s on top of the $50 million it needs to raise by selling another seven properties.

Will Carless is an investigative reporter at Voice of San Diego currently focused on local education. You can reach him at will.carless@voiceofsandiego.org or 619.550.5670.

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Will Carless

Will Carless was formerly the head of investigations at Voice of San Diego.

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