Crane Watch update: More than 22,000 residential units have flooded into San Jose’s development pipeline

More than 22,000 new residential units have been proposed in the city of San Jose — the largest city in the housing-starved Bay Area — according to city records and Business Journal reporting over the past year.

Those number have been gathered over the past year and a half and detailed in the Silicon Valley Business Journal’s Crane Watch map, which is a compilation of every large development project that has arrived at the San Jose city hall.

When the Silicon Valley Business Journal’s Crane Watch map launched in 2017, it detailed 30 of the biggest projects in San Jose. But a little more than a year later, the number of projects we’re tracking has ballooned to 107 proposals. These include developments that are anywhere in the city’s development pipeline, from an early vision submitted to the city for feedback all the way to a recently completed structure.

Crane Watch shows industrial, office, residential, hotel, health care, education, retail and mixed-use proposals, and active projects that are 90,000 square feet in size or larger throughout the city of San Jose.

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More density and time for Brooklyn Basin development as proposed

With only 241 of the fully-entitled project’s 3,100 units of housing to rise on the Brooklyn Basin site along Oakland’s waterfront currently under construction, the Signature Development Group is now seeking approval to add another 600 apartments to the project’s total.

As proposed, the additional units could be “accommodated” within the building envelopes for the development as already approved, without any changes to heights, massings or setbacks. But if approved, the overall timeline to complete the Brooklyn Basin development, which was expected to be completed by 2029, would be extended to 2038.

In addition to the increased density, Signature’s proposed changes also include an additional 158 boat slips around the future Shoreline Park, a new water taxi loading dock, and the potential flexibility to shift the approved locations of the development’s five towers which are currently entitled to rise up to 240 feet apiece.

 

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San Francisco startup to build 270-unit ground up development in SoMa as part of co-living push

Starcity, a co-living development startup that is known for building “dorm living for adults,” is planning to erect a 270-unit building dubbed “Minna” in SoMa as part of its latest development push.

It also is eyeing a downtown San Jose property three blocks from Caltrain for more than 750 units.

Starcity’s model of private rooms paired with shared spaces can boost the number of units or rooms in an apartment project threefold, the company said in a statement Wednesday morning. Along with ground-up developments, the company converts and renovates defunct or underused commercial spaces into communal living spaces geared toward a middle-income demographic squeezed by high housing prices.

The San Francisco-based housing developer said Wednesday that 50 percent of the units will be affordable in the project at Minna & 5th Streets. Starcity currently has four San Francisco properties it owns and operates, with nine more in the pipeline.

Read more on San Francisco Business Times

Apartment rentals make up a larger share of new housing units in the U.S. than they have in decades

New preferences, low affordability of new homes drive greater demand for apartment rentals.

Apartment rentals have been luring residents away from other kinds of housing since the housing crash—and that is not likely to change in the foreseeable future.

“Apartments should continue to play a role in the total housing market that goes beyond the historical norm,” says Greg Willett, chief economist for Real Page Inc., a property management software and services provider based in Richardson, Texas.

In the years after the Great Recession, millions of people lost homes to foreclosure and had to move, often into apartments. The extra demand for units was not expected to last more than a few years. However, today—more than a decade after the collapse of Lehman Brothers—the percentage of American households that own their own home is still near its low point. New households are still much more likely to chose to live in rental housing than in the years before the crash.

 

 

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Why Hudson Pacific’s development plans near San Jose airport could be a big deal

The nine-story development would add to the developer’s already extensive portfolio in North San Jose, an area of the city that’s experiencing a flurry of commercial real estate activity.

Hudson Pacific Properties Inc. is looking to expand on a slew of existing office campuses it owns near Mineta San Jose International Airport by building a nine-story office building paired with a big parking garage.

The Los Angeles-based developer submitted a proposal to the city of San Jose last month that lays out a plan to build a new 350,000-square-foot office building and a 1,052-spot, five-story parking garage on 5.29 acres along Technology Drive that are vacant. A single-story office building appears to be attached to the proposed garage in a rough rendering that was submitted to city planners in September.

Hudson Pacific is calling the project “Cloud 10.” The site at 1601 Technology Drive is already entitled for either a 350,000-square-foot office or a 400-room hotel, per a city-approved general development plan for the land. It appears Hudson Pacific has opted to go with office space over the hotel.

 

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How will S.F.’s tallest buildings fare in the next big earthquake? Report expresses concerns

San Francisco’s tall buildings may be at risk of damage during the next big earthquake, a study released by research nonprofit Applied Technology Council (ATC) last week warns.

The 36-page report outlines vulnerability concerns over outdated building standards and provides a strategy for proactive safety checks.

The study’s release comes just days after cracks were found in two steel beams of San Francisco’s newly minted $2.2 billion Transbay Transit Center, and as Millennium Tower next door continues to sink and tilt. Last year, the late Mayor Ed Lee commissioned the report, which was prepared by a group of engineers.

The report probed the city’s 156 tallest buildings — either constructed or permitted for construction — that are at least 240 feet high, primarily located in San Francisco’s Financial District. About 60 percent of these buildings house business and office space, while the rest are zoned residential.

 

Read more on San Francisco Business Times

 

 

The 10 top emerging trends that will shape real estate in 2019

The Urban Land Institute’s annual look at the year ahead focuses on technology and transformation at an uncertain moment.

It’s complicated. In the course of compiling its annual Emerging Trends report, the Urban Land Institute found that the only certainty in its outlook for 2019 was uncertainty. Expert analysis points to a more complex, multi-layered series of overlapping trends, with unpredictable results, as opposed to a few strong narratives.

Will technology offer more opportunity and enhance competition and efficiency, or help consolidate the industry and drive out smaller players? How will shifts in demographics and shopping patterns challenge current investment practices? Will the U.S. ever get a grip on its housing affordability issues?

The report, a joint project of ULI and PricewaterhouseCoopers researchers unveiled during its fall meeting in Boston this afternoon, considered the responses of more than 750 real estate professionals in creating an high-level overview of the trends it believes will impact the real estate world. While the report expects an overall economic slowdown next year, emerging trends and markets in flux that could provide new opportunities.

 

 

Read more on Curbed

 

 

 

Milpitas’ Great Mall unveils major revamp as Silicon Valley shopping centers up the ante

As retail sputters in some places around the country, Silicon Valley retailers and property owners are facing a different challenge: How to compete in a market where investment is still hot in the retail sector.

The Great Mall in Milpitas is one of those looking for a competitive edge in a region where the traditional malls are either going by the wayside or upping the ante to create a space that offers not just shops, but experiences.

Indianapolis-based Simon, an international shopping center and mixed-use property owner, last month wrapped up an extensive, two-year renovation project for the massive shopping center, which has more than 200 stores. (For fun facts about the revamp, click through the slideshow above.)

The revamp added or expanded some of its stores, but also redesigned what it is calling a “dining pavilion” that has 10 restaurants.

“Our goal is to provide the best shopping and entertainment experience for our guests and this transformative renovation makes that possible,” Angela Pyszczynski, general manager at the Great Mall, said in a statement.

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Tenants start grabbing space in one of the East Bay’s only new office towers

One of the Bay Area’s largest life science landlords, Wareham Development, is now more than a third leased up in its latest project, the 265,000-square-foot EmeryStation West in Emeryville.

The San Rafael-based developer recently completed the building after starting construction back in 2016 with no tenants in hand and now has commitments for 93,000 square feet with Profusa Inc. taking 18,000 square feet and Dynavax Technologies Inc. taking 75,000 square feet.

“We have built the project to the highest-quality research and office building standards and are pleased the market recognizes that,” said Geoffrey Sears, a partner at Wareham, in a statement.

The building, designed by Perkins + Will, contains seven stories of office and lab space above two levels for transit and parking. DPR Construction served as the general contractor.

The building is part of Wareham’s 2 million-square-foot EmeryStation research and technology campus and is the latest addition to the company’s broader 4.5 million-square-foot portfolio in the Bay Area.

Wareham, led by CEO Rich Robbins, has specialized in developing biotech and life science buildings in Emeryville, Berkeley, Richmond and Palo Alto. Before EmeryStation West, the last new office building in Emeryville was Wareham’s 99,000-square-foot EmeryStation Greenway in 2012. That property was leased up by Stanford Health Care.

Read more on San Francisco Business Times

Making heads or tails of the U.S. multifamily sector

If you were to focus solely on the slowing pace of rent gains, burgeoning supply and the rise in interest rates, you might assume that the real estate market isn’t in a strong place right now.

But despite all of the above, the multifamily market is in a healthy position. Demand is being driven by encouraging demographic shifts and a strong economy. Despite moderating elements, because the economy is healthy, the apartment market is similarly healthy, even if the boom from earlier in this economic cycle has tapered off.

GDP growth came in at 2.3% for the year in 2017, and a whopping 4.2% in Q2 2018. Consumers are buying confidently provided that tax cuts will improve yearly income even despite stagnant wage growth. Our multifamily clients are anticipating that U.S. rent growth should maintain its current pace, largely thanks to cities in the South and West, where supply hasn’t outpaced demand.

According to the Spring 2018 Yardi Matrix U. S. Multifamily Outlook report, given the state of supply and demand in most metro areas and the steady economy, rents are projected to increase by 2.9% nationwide this year, with heavy concentration in late-stage southern and western U.S. markets. However, concerns about affordability are keeping prices from rising at an exceptionally fast rate, and new supply is also helping to keep those costs level. As for the supply, completions are expected to maintain the same steady pace they have over the past few years. Absorption rates are anticipated to remain strong for the remainder of the year, and 290,000 additional units are expected to finish construction by 2018, resulting in a 2.2% increase of stock. Another big factor that’s supporting the real estate market is the steady flow of capital pouring into the industry.

 

 

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