Google is gearing up to buy prime San Jose land for a new tech campus. What now?

As the city of San Jose gets ready to release long-anticipated documents related to the sale of 20 acres of land near downtown, the question on the minds of both boosters of the Google expansion and skeptics is “what now?”

The city of San Jose is on the verge of releasing details of a controversial 17-month negotiation to sell 20 acres of publicly owned land to tech giant Google for a massive new campus near downtown.

Those details, set to be released Friday, are a key milestone, but only the first step of making the Bay Area’s largest city one of the next expansion points for Alphabete Inc.-owned Google, a plan that has been met by community members with both excitement, deep disdain, and as of this week, a lawsuit over transparency.

Now, as the release date of the long-anticipated land sale documents near, the question on the minds of both boosters of the Google expansion and skeptics is “what now?”

First, the end goal: Google has said it wants to build a mixed-use campus that could span as large as 8 million square feet and would include housing, retail, and office space next to transit. Somewhere between 15,000 and 20,000 workers could show up each day at the campus if built out fully.

 

 

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Contra Costa County setting itself up to be next Bay Area hub if only the jobs will follow

Several large-scale projects in Contra Costa County could transform the suburban county into a thriving employment center with live-work-play dynamics.

The region’s biggest challenge will be actually getting to that point. Many investors and developers think the county is well on its way.

“What is wonderful about Contra Costa County is that it is unmatched quality of life if you can afford to live here in terms of work, play, live opportunity,” East Bay Leadership Council President and CEO Kristin Connelly said during Bisnow’s recent Future of Contra Costa event. “I’m a huge champion of the East Bay. We are poised to be the center of the mega-region in Northern California because of our assets.”

While more development is occurring in Contra Costa County, many cities are struggling to be attractive to employers, and many residents are still commuting elsewhere for their jobs. The East Bay Leadership Council found that 78% of Contra Costa workers commute to Western Alameda County, San Francisco or San Jose, Connelly said.

Cities like Walnut Creek and Concord are having to build more housing to meet the needs of current and new residents.

“When you’re seeing the South Bay having a 10:1 job-to-housing ratio, we’re the ones in the East Bay and the suburbs having to pick up the slack because of that,” City of Walnut Creek Mayor Justin Wedel said.

Cities are working to create better balances that can be attractive for employers seeking a live-work-play dynamic.

 

 

Read more on Bisnow Oakland

 

 

Major S.F. tech company eyes one of Oakland’s largest vacant office buildings

San Francisco-based fintech Square Inc. has eyed Oakland for a big lease, according to the San Francisco Chronicle.

The payments processing company reportedly looked at Uptown Station, a 356,000-square-foot refurbished, mixed-use building that is one of the largest blocks of office space available in Oakland.

“There are large tech tenants looking at Uptown, but none have landed yet,” Edward Del Beccaro, a managing director of Transwestern, told the Chronicle.

Landlord CIM Group has been chasing tenants for the space since it bought the building in December 2017 for $180 million. The approximately $40 million renovation of Uptown Station by Truebeck Construction is expected to finish early next year.

CIM picked up the property at 1955 Broadway from Uber Technologies, which had planned to move up to 2,000 employees into the space, but decided to consolidate in San Francisco instead.

Square has been on a growth tear as of late. Over the summer, it added 104,100 square feet to its San Francisco headquarters at 1455 Market St. for a total of 469,000 square feet there. It is also growing outside the Bay Area and internationally.

In addition to Uptown Station, Oakland has a handful of similar historic rehabs, including projects from TMG Partners and Harvest Properties.

Read more on San Francisco Business Times

More move to modular construction to mitigate costs, but it’s not the solution for every project.

In an effort to shorten construction timelines to cut down on costs and find creative ways around the shortage of skilled labor, multifamily developers have embraced the possibilities of modular construction.

But as with any new technology, there are still a lot of pitfalls and issues to work out before it becomes a solution for everyone — and it is not a solution for every project.

The move to modular is being driven by a combination of desperation and fear of the future, Panoramic Interests owner Patrick Kennedy said last week at Bisnow’s Multifamily Annual Conference NorCal in San Francisco.

“Conventional methods seem untenable in many circumstances,” he said.

Ultimately, construction costs will just get higher and more developers across markets will look at modular to address costs and the labor shortage.

 

 

Read more on Bisnow SF

 

 

 

Is Silicon Valley going to change the way we build CRE?

From the end of World War II in the mid-1940s until just a few years ago, there was a surge in productivity throughout the United States economy, giving rise to what has often been called the “productivity miracle.”

Throughout this period, nearly every industry in the US — from retail to manufacturing to agriculture — became not only less expensive, but also much more mechanized and faster, leading to increased efficiency.

One industry, however, failed to come on board with this trend – construction. In fact, productivity in construction has not only not increased, but it is also actually lower today than it was in the late 1960’s.

In other words, the way that most commercial real estate buildings are built hasn’t changed much in the last 50 years or so. The process goes by the name “design – bid – build” – but it isn’t nearly as simple or straightforward as it sounds. First, the developer or owner needs to hire an architect, who drafts a rough design. In order to do this, he or she must bring in various outside consultants, such as structural engineers and landscape architects. Next, the owner puts the design out for bids from various general contractors and then hires one (usually the least expensive bid). From there, the general contractor subcontracts the work out, with the architect and the general contractor working together closely to make sure the project is completed as close as possible to budget and on schedule.

If the system sounds complicated, well, that’s because it is. Having so many cooks in the kitchen, so to speak, often leads to misunderstandings, placing blame on others, or worse. The combination of volatile prices for materials and an observed shortage of skilled labor has created an industry that is primed for disruption.

 

 

Read more on NAI Global

 

 

 

Bay Area tops U.S. in new office space, but lags in housing starts

 The Bay Area is a hot place to build cubicles, conference rooms, and office suites. But don’t look for as many hammers pounding out new homes, condos, and apartments.

The region is expected to open 18.2 million square feet of office space in 2018 — tops in the nation and more than New York City and Dallas combined — while home, condo and apartment building has grown only modestly.

More work space, more jobs and more people chasing a limited supply of homes is expected to add more steam to the pressure cooker of the Bay Area housing market.

“It’s encouraging that so many respected employers are investing in Bay Area jobs and immigration growth” said Carl Guardino, CEO of the business-backed Silicon Valley Leadership Group. “But we all recognize that jobs need a place to go home and sleep at night.”

The region created six times as many jobs as housing units between 2010 and 2015, according to a study by the leadership group and the Silicon Valley Community Foundation. The increased housing pressure has forced lower-income workers out of the region at much faster rates than higher paid workers, even as jobs go unfilled.

The run up in commercial development is led by major office openings in the South Bay, according to a survey from real estate data company Yardi Matrix. The big projects in 2018 include the official, complete opening of the 2.9 million square foot Apple Park in Cupertino, Park Tower at Transbay and The Exchange on 16th in San Francisco totaling 1.5 million square feet, and Facebook’s MPK 21, a half-million-square-foot campus designed by Frank Gehry in Menlo Park.

Other major developments underway include the Voyager property developed by Nvidia in Santa Clara, Microsoft and Google projects in Mountain View, the Stoneridge Mall Road project in Pleasanton, and Moffett Towers in Sunnyvale, according to Yardi Matrix.

The real estate data firm estimates that commercial openings in Santa Clara County are up 6.5 percent over the same period last year. The San Francisco and Oakland metro has seen three times as much commercial space open up this year compared to last year.

 

 

Read more on The Mercury News

 

 

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

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

 

 

2nd crack at SF Transbay Transit Center — to stay closed through next week

San Francisco’s new Transbay Transit Center will remain closed at least through the end of next week, officials said Wednesday, after yet another cracked beam was discovered during an overnight safety inspection.

The $2.2 billion hub for buses and eventually trains, which opened just last month as the flashy centerpiece of city infrastructure, was closed abruptly Tuesday afternoon after a fissure was spotted in a beam that helps hold up the sprawling complex.

The initial tear runs about 2½ feet long and 4 inches deep through the bottom of a 60-foot-long beam that supports both the center’s celebrated rooftop park above and a bus deck below, officials said. The beam is located over Fremont Street, between Mission and Howard streets. The second crack is in a parallel steel beam that also crosses Fremont Street. It was described as slightly smaller.

Representatives of the Transbay Joint Powers Authority, which built and operates the transit center, said Wednesday they didn’t know the causes of the cracks, but they remained concerned about the potential for the beams to fail. Fremont Street, which passes under the center, also is scheduled to stay closed through Oct. 5.

“We will not open the transit center or Fremont Street until we are certain the issue is 100 percent rectified,” said Mark Zabaneh, executive director of the TJPA.

 

Read more on San Francisco Chronicle

 

 

Business fees to fund housing will be studied in San Jose

The concern, even for some council members who voted for the study, is that despite its housing shortage, San Jose still has many more residents than jobs, which is the opposite of the situation in many surrounding cities.

The imposition of commercial linkage fees to fund below market-rate housing is still alive in San Jose after Tuesday’s 9-2 City Council vote to add a discussion of them to next week’s agenda.

The vote came on an item of how the city should respond to a Santa Clara civil jury report issued in June that included among its findings that the fees are overdue and would increase housing.

Five council members, including Mayor Sam Liccardo, wrote memos changing the staff-authored response of disagreement with the finding to say the city would consider a study to confirm the causal relationship between job creation and an increased need for housing and a second study of the feasibility of enacting fees.

 

 

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