After reading an inewsource report on problems with a closed public restroom and a homeless encampment at East Village’s Fault Line Park, San Diegans might be thinking the public-private partnership the city struck with a private developer to create the park is a bad deal.

But the deal with the developer isn’t the problem.

The problem is that East Village is in a moment of massive transition. While the neighborhood’s quickly gentrifying and new people and businesses are moving in, the homeless population is also peaking. The tension between those two camps is on full public view at the park.

But neither the city nor the developer know how to handle the problems that pop up when the homeless and the homed attempt to share public space. It’s an issue that’s plagued urban cities for decades.

Fault Line Park, located between J Street and Island Avenue, is the first public park in East Village. The eye-catching design nods to the fact that the park’s built on a fault line. A sidewalk cuts diagonally through it, tracing the line of the shallow earthquake fault zone running below. On one side of the sidewalk, the grass is flat. On the other side, the land bubbles up in mounds, meant to symbolize the rupture and ripples a quake can cause. There’s also an interactive public art installation that monitors the earth’s movement below.

In the landscape design world, there’s a concept called “eyes on the park” that says leaving open sightlines around a park periphery and encouraging activity inside through various amenities will deter crime and discourage other unwanted uses. At Fault Line Park, there are wide open views, plus a playground and a large restaurant and cafe in the northwest corner that’s meant to help get more people in and out of the park.

It’s a smart and creative design.

But it hasn’t stopped a homeless encampment from springing up on the south side of the park. The benches and shade overhang there have provided a perfect place for some of East Village’s booming homeless population to camp out. A public restroom attached to the restaurant and cafe has been closed on and off for months due to problems related to the homeless population.

“The city always knew there would be this transitional time where the park would be waiting to get more eyes on the park as the residential population grows,” said Leigh Kyle, one of the principles of Spurlock, the landscape architecture firm that designed the park. “It’s a nascent residential population, but what are you going to do? You have to put the best intention into the amenities that get put there and hopefully over time there’s a really good balance of people who are living downtown and using the park as their backyard.”

Fault Line Park is the result of a redevelopment deal struck back in 2005 between the city’s former redevelopment agency and Pinnacle International Development Inc., the developer behind two high-rises that border the park (one tower is built, the other’s still under construction).

Here’s what the public-private partnership deal essentially boils down to: The developer paid the city $5 million for a 30,000-square-foot lot. Then the city paid Pinnacle back that $5 million, and the developer was required to build a public park almost double the square footage of that plot, plus build public restrooms and maintain the park and the bathrooms in perpetuity. In exchange for taking on the cost of the design, construction and lifetime maintenance of the restrooms and park, the developer got some benefits out of the deal, including the ability to build more units.

If the city wanted to purchase a nearly 60,000-square-foot lot in the East Village, design and construct a park and then maintain it for its lifetime, the price tag would’ve been exponentially higher than $5 million.

“On paper, this is a fine deal,” said Gary London, a real estate expert who advises cities and private developers. “This is the kind of deal private developers and cities should be doing all the time. I think it’s a model, but they should have anticipated that even though it looks good on paper, not every part of it is going to work out.”

The biggest issue stems from the fact that a private developer is now having to tackle issues related to successfully running a public park and restroom in the middle of an urban environment with a high homeless population.

The city itself has yet to figure out similar challenges nearby. Children’s Park, for an example, is a downtown public park that has largely failed because the dense trees and hilly design of it attracts homeless people in search of privacy and nearby residents avoid it. And the city recently closed a public bathroom that was just down the street from Fault Line Park because of problems. Jon Wantz, the former manager of the restaurant and café at Fault Line Park, was actually a vocal critic of that city-run public bathroom and was part of the campaign to close it down.

Dennis La Salle, a development manager at Pinnacle International, said the bathroom at Fault Line Park will reopen to the public soon, but he said he’s working with the city and the San Diego Police Department to figure out the best way to keep the same old problems from popping up again.

He said the issues with the bathroom arose when the restaurant tenants, who have the keys to the bathroom since the facility is attached to their building, started locking the public restrooms and only opening them for patrons. La Salle said some of the restaurant employees were close to a stabbing that happened near the bathroom and a homeless person flashed another employee.

“There was a lot of illegal activity going on in those restrooms so it started to be a hassle,” La Salle said. “But it shouldn’t be closed, it should be open and operational.”

He said operating a public restroom in the developing East Village environment is a huge challenge, and he’s not sure Pinnacle will be the ones to solve it.

“I mean, there’s not a solution,” he said. “We’ve tried to put our heads together to come up with one. I’ve asked (Park and Recreation) for assistance on this … We’re looking at it, but in the meantime the bathrooms do have to stay open until we come up with an agreeable solution.”

The homeless encampment is an even trickier issue, La Salle said, since homeless people have the right to use the park as long as they’re not breaking any laws. He said he does hear complaints from the restaurant tenants and neighbors, but he won’t do anything unless the concerns are about more than just their presence in the park.

“Now, I do think we need to do something to accommodate the homeless so they don’t camp out there,” he said. “But I personally don’t have any problem with them. They have the same rights as everyone else.”

Kyle, the landscape architect, said things could have been worse. When the park was first being discussed, she said the city and developer were concerned about the effect of the neighborhood’s homeless population so they asked her firm to put a fence around the park. She said the fence would have made the park less attractive and given it less of a public appearance.

“At the end of the day, the city elected not to build the fence and I think that’s a good demonstration of optimism about these young neighborhoods downtown becoming balanced over time,” she said. “These current difficulties that come with the public-private partnership and the operations and maintenance stuff, they’re figuring that out real-time for the first time.”

She said once the problems are worked out, she thinks Fault Line Park will ultimately inspire more public-private open spaces in East Village.

London, the real estate adviser, has an office in East Village. He said he’s never seen a neighborhood develop so much, so quickly. But even with the rapid rate of change in East Village, he said he knew the park would cause a problem, at least temporarily.

“I described this park when I first looked at it as an issue waiting to happen,” he said. “But as more people and businesses come in, what happens is it makes the homeless population uncomfortable and they’ll likely move further east and then those communities will have to deal with the same issues.”

Correction: An earlier version of this post misidentified the location of Fault Line Park. It sits between J Street and Island Avenue, not at the corner of J Street and Island Avenue.