Bought June 1867, subdivided 1869, one lot paid for the whole tract. All records sourced and cited.

In June 1867 Matthew Sherman bought a hundred and sixty acres of San Diego from the City Trustees at fifty cents an acre.
Eighty dollars.
Two years later he subdivided it, and in November 1869 the San Diego Union carried his lot sales at an average of a hundred dollars apiece. One lot paid for the whole tract and left him twenty dollars ahead. The ground is still called Sherman Heights.
Three things before the story runs. He bought it the month after his wedding, and he was married on the same day Alonzo Horton bought downtown. His wife is the reason Mount Hope Cemetery is called Mount Hope. And when he was mayor, the city's first Cabrillo celebration dropped him off a pier into the mud.
Matthew Sherman was born in Massachusetts on October 11, 1827, and went into the Navy at thirteen. He served on the USS Columbus and the USS Independence, and he first laid eyes on California in 1847, when the Independence touched at Monterey during the Mexican War.
In the Civil War he was a lieutenant and then a captain in the 4th Infantry Regiment of the California Volunteers. The Army stationed him in San Diego in 1862. He liked it enough that when he was discharged in 1865 he came back to stay.
He took the job of Customs Collector and held it four years, living and working in the old Army barracks down in New Town.
Which means that when Alonzo Horton stepped off the boat in April 1867 to buy the land that became downtown San Diego, Sherman had been living here since 1865.
May 10, 1867 was a busy day. Horton bought nine hundred and sixty acres from the City Trustees. Matthew Sherman married Augusta Jane Barrett, a New Englander who had come out by way of Panama the year before and taught school in Old Town.
The following month Sherman bought Pueblo Lot 1155, the hundred and sixty acre tract next to Horton's purchase, for fifty cents an acre.
He called it Sherman's Addition. Everybody else called it Sherman Heights, because of the elevation. It runs from 15th Street to 24th, between Market and Commercial, and it looks down over the flat ground that became downtown and out to the harbor.
A newspaper of the day put the pitch in one line. "The location is salubrious and commands a magnificent view."
Sherman subdivided in 1869.
In November of that year the Union ran his sales three weeks running. The lots were going at an average of a hundred dollars each.
He had paid eighty dollars for all of it.
That same October, now sitting as a City Trustee himself, Sherman was part of the decision that land was selling fast enough that the city had better set some aside before it was all gone. The Trustees dedicated a fourteen hundred acre City Park and a two hundred acre cemetery tract.
Augusta Sherman picked the name for the cemetery. Mount Hope.
In 1871 Sherman went to Washington to push the bill chartering the Texas and Pacific to build a rail line out to California.
The man who worked out the final details of that bill was Congressman John A. Logan. Fifteen years later a subdivision went in on railroad land southeast of Sherman Heights, one of its main streets was named for Logan, and the name spread until the whole area was called Logan Heights.
So the two neighborhoods on that side of downtown are named for the developer who bought the hill and the congressman who passed his railroad bill.
The railroad lands in that deal were four more Pueblo Lots, 1158, 1159, 1162 and 1163, running from Commercial Street down to the waterfront between 24th and 32nd.
When the California Southern finally connected San Diego to the Santa Fe in 1885, the population tripled.
Sherman came out of semi retirement, sold his farm and vineyard in El Cajon, and built himself a house on the hill. Two stories, eleven rooms, fifteen thousand dollars, which was several times what a house cost then. It is still at 563 22nd Street, remodeled into the Sherman Apartments.
Two years later, at the southwest corner of Twentieth and K, the pianist Jesse Francis Shepard built Villa Montezuma.
A San Diego biographical volume published in 1888 described it while the paint was still new, and the writer could not decide whether to be impressed or alarmed. "There is something so very peculiar, something so very striking about even the exterior of the building that the passer by cannot but stop and admire its extreme unostentatious eccentricity."
The same account gave the reason the house was put there, and it is the same reason the Union gave in 1869. The site commands a magnificent view of San Diego.

Sherman was mayor in 1891 and 1892.
The best thing that happened in his term was a disaster. The city staged its first celebration of Cabrillo's landing, three hundred and fifty years after the fact, with a La Playa fisherman named Manual Cabral playing Cabrillo in velvet kneebreeches and an ostrich feather hat. The ship was supposed to land at the Broadway pier. It ran late, the tide went out, and it stuck on a shoal offshore.
The crowd pushed out onto the wharf to see, the handrail gave way, and a number of frock coated officials went into the mud, the mayor among them.
The rest of the day went better. Cabrillo was received onshore, and the party marched up Broadway to Horton Plaza behind the bands.
Matthew Sherman died on July 5, 1898. He was remembered as a man "gentle in manner and approachable," with "many friends and few enemies." Augusta died in 1913. They are buried together at Mount Hope, which she named.
The houses. Sherman Heights carries one of the densest surviving collections of Victorian residential architecture in San Diego, because the boom that built it was followed by a bust that left it alone.
Villa Montezuma still stands at 1925 K Street. The Livingston house is at 2412 J. Sherman's own house is the apartment building at 563 22nd.
Sherman Heights, Golden Hill and the blocks around them are old subdivided ground with original street layouts and a great deal of nineteenth century building stock still on it. That brings historic designation into the picture, and designation governs what can be changed on a street facing elevation and how long a permit takes.
None of that is a reason to stay away. It is a reason to find out, before you write an offer, which designation a property falls under and what it means for the work you were planning. On a block like this it is the first question, not the last.
The nearest market coverage is Golden Hill and South Park, and the wider area is in Metro and Central.
Not the oldest subdivision. The Journal article calls Sherman Heights "one of the oldest subdivisions in New San Diego." That is the claim this piece makes and no more. Several San Diego neighborhoods are described somewhere as the oldest, and the record here does not settle it.
The first house claim. Sherman's obituary in the San Diego Union and a 1913 biography both say he built the first house in New San Diego. The Journal article's own footnote questions it, pointing out that pre cut houses arrived by the brig Cybell from Maine in 1850 and that one of them still stands at 227 11th Street. The claim is left out of this piece for that reason.
A direction that does not sit right. The Journal article describes Pueblo Lot 1155 as "adjoining Horton's property on the west," and then, in the next sentence, has Sherman Heights looking out over downtown and west to the harbor. Those two statements pull in opposite directions. This piece says the tract adjoined Horton's purchase and leaves the compass out of it.
Where he was born. The Journal article gives Charleston, Massachusetts. The place in Massachusetts is Charlestown. This piece says Massachusetts and does not pick the town.
More San Diego history: stories from around the county, one place at a time.