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Staying in front of trends creates niche for MSK Development Group

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Joe Gallagher has made a habit of "boldly going where no one has gone before." But instead of far-away galaxies, he is looking for undervalued properties to put to their highest and best use. He has spent his 30-year career creating groundbreaking projects and helping communities reach their highest potential.

Joe Gallagher

In the late 1970s, working for Leisure Technology, the largest developer of active adult communities in the country, he proposed building a retirement community in Oceanside, then a sleepy military outpost. The resulting community, the 1,620-home Leisure Village Ocean Hills, became the national standard for active adult communities and heralded the development of much more upscale development there. Under his leadership as Southern California president of Leisure Technology, the community was the top-selling community in San Diego County for several years.

In the 1990s, Gallagher took a similar tact in Hemet, where he was the managing partner in the master-planning of Four Seasons, the gated golf course community for seniors, now being built by K. Hovnanian.

"When we started working on Four Seasons, the median price of a home in Hemet was $150,000. Now homes selling at Four Seasons are averaging $400,000 and the city has been invigorated by our new golf course and upscale development," said Gallagher, who has retained the rights to build the final 35 homes in the best view location within Four Seasons.

Today, Gallagher's company, MSK Development Group, is the developer or managing partner in residential and commercial real estate projects valued in excess of $250 million. Projects include custom home infill projects in Old Carlsbad and Oceanside's Fire Mountain, a 65-home subdivision on 327 acres adjacent to San Diego Country Estates in Ramona, as well as a an 86,500-square-foot self-storage project in Valley Center.

His office is in a sprawling home overlooking Valley Center, on the site of his largest project, Live Oak Ranch, a $124 million residential neighborhood of 146 estate-size homes on one- or two-acre sites.

The location is indicative of a trait that has made him successful. Gallagher is personally involved in the entitlement process; he never hires entitlement consultants.

"We don't have an intermediary making promises or telling our story. I personally represent the project to neighboring stakeholders and elected officials," he said. "By establishing trust with decision makers, we have a track record of proceeding through the development process more smoothly than most."

He also maintains a personal relationship with a close-knit team of employees and consultants, many of whom have worked with him for years. Phil Buccola of Buccola Engineering in Oceanside has been a part of Gallagher's development team for 25 years and their friendship goes back to age 3. Gallagher and Frank Marczynski of Topia Landscape Architecture/Planning of San Diego have been working together since 1979. Gallagher also has longtime relationships with First American Title Insurance Co. and a number of lenders.

Gallagher says personal interactions are his favorite part of large-scale development. "Big projects are enormously complicated and require a host of players -- land owners, public jurisdictions, finance partners -- in addition to the development team," he said.

"Creating a scenario that satisfies the concerns of all parties -- and is economically viable -- takes enormous creativity, consensus building skills, perseverance and ingenuity," he said. "I can't imagine a more challenging -- or personally rewarding -- business."

One could make the case that Gallagher's real estate addiction is in his blood. His grandfather left a teaching post at Notre Dame to come to the Golden State. After a stint living in a tent selling beachfront property in Huntington Beach, he was named chief right of way agent for the Los Angeles Department of Water and Power. Later, during his 45-year career, he helped found the Society of Real Estate Appraisers and the Right of Way Association.

Gallagher's father, J.A. Gallagher Jr., continued the tradition, establishing himself as a prominent real estate appraiser and consultant in the western United States, specializing in eminent domain appraisals and other complex appraisal assignments.

"My father taught me the rudiments of the real estate business and has been my greatest inspiration," he said. "Being schooled in appraisals -- knowing how to evaluate land and opportunities -- has given me a tremendous advantage. I'm always looking at the highest and best use," he explained.

That's a trait that has had a huge impact on Gallagher -- and the communities he has touched.

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