The Building
Walk through almost any older San Diego neighborhood and you'll find them: modest two-story courtyard apartment buildings built in the 1960s, usually 8 to 16 units, wood-framed, with surface parking out front. They were fast and cheap to build, and they remain some of the last naturally affordable housing left in the city.
The Economics
Try to replace one of these buildings today at the same unit count and the math falls apart. Construction costs have roughly tripled since the 1960s in real terms, while modern building codes, fire and seismic requirements, and parking minimums all add cost per unit. In many cases, a developer can only make a project pencil by building fewer, larger, more expensive units, or far more units than the original building had, which requires assembling multiple lots.
The Opportunity
This is exactly why cities have started experimenting with density bonuses, parking reductions, and streamlined permitting for missing-middle housing. For investors, it also means well-located mid-century buildings are worth more as-is, with modest renovation, than as teardown-and-rebuild candidates in most cases today.