Posts

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.

Read more on Silicon Valley Business Journal

 

 

 

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.

 

Read more on Silicon Valley Business Journal

 

 

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.

 

 

Read more on Silicon Valley Business Journal

 

 

 

Facebook is bingeing on Bay Area real estate

As Wall Street frets over a slowdown, the social media giant’s expanding property empire suggests Mark Zuckerberg has few doubts about the future.

Since Facebook Inc. arrived in Menlo Park, California, seven years ago, the town has been overrun by construction cranes, orange safety cones and truckloads of building materials to transform a former industrial area into a sprawling campus that can support a $500 billion tech giant.

So big are the ambitions that the company plans to redevelop whole swaths of the land it holds in the Silicon Valley city, potentially doubling its workforce there over the next decade to 35,000 people—more than Menlo Park’s current population.

Even that won’t be enough for its expansion plans.

“We continue to grow,” John Tenanes, the company’s head of facilities, said in a conference room overlooking a salt marsh in Facebook’s newest Menlo Park office, a Frank Gehry-designed building called MPK 21 that opened last week. “We’re at a point where we needed more space, and this area couldn’t keep up.”

For all the turmoil surrounding Facebook and investor concerns about a slowdown, the company’s gone on a real estate binge that suggests that its optimism about its future knows no limits. Menlo Park is just the start. In the past year alone, the company has signed agreements that could vastly expand its footprint in the San Francisco Bay Area. It’s been one of the most active leasers in the region’s already hot office market, spurring brokers and analysts to do math on just how it will fill so much space.

 

 

Read more on Bloomberg

 

 

 

Facebook breaks ground on community hub devoted to nonprofits

Facebook will soon break ground on its latest development, but this time the social media company isn’t building offices — it is creating a nonprofit community hub.

The 12K SF community hub will provide much-needed space for nonprofits educating the community and youth about tech and coding. It is expected to open in early 2019.

Large tech companies and organizations have been devoting community spaces for nonprofits and events as part of their campus or office developments. Salesforce has devoted the top floor of Salesforce Tower, the ohana floor, for community and nonprofit events after hours. Google opened a free 8,500 SF workspace for nonprofits at its Embarcadero office in 2017.

Large tech companies and organizations have been devoting community spaces for nonprofits and events as part of their campus or office developments. Salesforce has devoted the top floor of Salesforce Tower, the ohana floor, for community and nonprofit events after hours. Google opened a free 8,500 SF workspace for nonprofits at its Embarcadero office in 2017.

Facebook’s Menlo Park Community Hub will be for local nonprofits focused on internships and workforce training, coding and technology courses and community development. The space is reservable for nonprofits, entrepreneurs and community events when not used for classes.

 

 

Read more on Bisnow Silicon Valley

 

 

Sneak peek: Office Depot debuts co-working space in Los Gatos store

Office Depot is piloting its first-ever co-working space inside a retail store at its Los Gatos location.

The move comes as the office supplies retailer looks to edge in on co-working giants like WeWork by offering workspace for freelancers, small business owners and remote workers.

The space inside the store at 15166 Los Gatos Blvd. is called Workonomy Hub.

Much like WeWork, Workonomy offers options ranging from renting a desk in a common area ($40 per day) to private offices ($750 per month). The space also includes high-speed Internet, free refreshments, business services like printing, shipping and mail and package handling, and, of course “easy access to office supplies.”

“The combination of Office Depot’s current suite of products and services with a physical co-working space creates a comprehensive offering for small business owners, entrepreneurs and remote employees under one roof,” the company said in a statement.

Read more on San Francisco Business Times

Getting downtown ‘right’ in San Jose has been a trial-and-error process

The plan for San Jose’s downtown is years old. What’s new is that Google has bought into that vision.

The critical challenge of getting things right in the next iteration of downtown San Jose has been a hot issue at least since the 1980s, when downtown was torn up and many businesses suffered and died during construction of the Valley Transportation Authority’s light rail system.

Downtown’s future was a central focus of the thousands of people who participated in the four years of work that in 2011 produced the city’s latest general plan, Envision San Jose 2040, that anticipated Diridon’s status as a transit hub amidst 40,000 new jobs.

“This is not a novel idea we just came upon because Google came around last year,” Mayor Sam Liccardo said.

Kim Walesh, San Jose’s deputy city manager and economic development director, said the plan always envisioned “having an anchor developer who would do a cohesive master planned development in that central area.”

That doesn’t mean, however, that latest round of planning efforts and community engagement sparked by Google’s development announcement last year has pleased everyone who will be affected by what happens around Diridon.

 

 

Read more on Silicon Valley Business Journal

 

 

 

Tech tenants continue to compete for limited Silicon Valley office space

The Silicon Valley office market continues to perform well, with tech tenants quickly grabbing up space, particularly larger blocks that are hard to come by in the tight market.

The recent 274K SF lease by Roku at Coleman Highline reflects the strength of the San Jose market. Google’s plans for an 8M SF campus in San Jose have driven a lot of activity in that city’s downtown.

But even beyond a bustling San Jose, the greater Silicon Valley office market has had strong fundamentals for the first half of the year, according to Savills Studley.

In Q2, there was more than 2.6M SF of office leased in Silicon Valley, adding up to 5.8M SF leased in the past 12 months, Savills Studley reports. Availability in the core markets of Menlo Park, Palo Alto and Sunnyvale/Cupertino remains in the single digits, while the region’s overall availability has decreased to 15.8%, down 130 basis points from a year ago.

At the same time, rents are rising, reaching $50.94 overall asking rent for the region in Q2, up 4%. Class-A rents were up 1.7% to $52.51. Tech tenants continue to drive the market.

 

Read more on Bisnow Silicon Valley

 

 

 

City may scrap downtown cap on commercial growth

Planning commission to review council’s proposal to eliminate 350,000-square-foot limit on downtown non-residential growth.

The simmering community debate over how much office space Palo Alto should accommodate is set to flare up again Wednesday night, when the city’s Planning and Transportation Commission will consider abolishing a policy that limits new non-residential development in downtown.

The proposal to scrap the cap was prompted by the City Council’s 5-4 vote in January 2017 to amend the city’s policies for office growth as part of the city’s Comprehensive Plan update, which was completed in November of that year. At the time, the five council members who are more amenable to growth — Liz Kniss, Greg Scharff, Adrian Fine, Greg Tanaka and Cory Wolbach — all voted to abolish the 350,000-square-foot limit on downtown non-residential development, arguing that the policy is no longer necessary given the other restrictions on commercial growth that are already in place.

Palo Alto already has a citywide limit of 1.7 million new square feet of office and research-and-development growth. A citizen initiative to reduce that limit to 850,000 square feet will be on the November ballot.

The council has also recently adopted the annual 50,000-square-foot cap on office development in downtown, around California Avenue and along El Camino Real, which intends to meter the pace of growth.

Even so, the proposal to remove the downtown cap proved deeply polarizing at the January 2017 meeting. Wolbach and Scharff led the charge on removing the policy, with each arguing that downtown’s transit options make it more suitable for commercial growth than other parts of the city.

 

 

Read more on Palo Alto Online

 

 

 

WeWork takes last vacancy in San Mateo development near Caltrain

The lease marks the co-working company’s first foray into San Mateo and the mid-Peninsula and comes on the heels of plans to open a second location in downtown San Jose.

WeWork is filling in the gaps of its footprint between San Francisco and San Jose, this week announcing it will take over the last of the remaining vacancy at a San Mateo office development recently completed by developer Hines.

The coworking company plans to move into about 96,000 square feet on four floors at 400 Concar Drive, one of two buildings in Hines’ 400/450 Concar creative office complex steps away from the Hayward Park Caltrain Station.

The 305,000-square-foot development has stood 70 percent leased since it was completed in early 2017. The lone tenant in the complex has been software maker Medallia, which in 2016 signed a lease for all 210-115-square-feet at 450 Concar. Now, the veritable co-working giant WeWork has staked a claim to an entire building in the complex, where it will offer 1,650 desks when it opens its doors in December.

“WeWork members all over the Bay Area have been asking for a location in San Mateo,” Elton Kwok, general manager at WeWork, said in a statement to the Business Journal on Wednesday. “We’re thrilled to finally be able to service theMid-Peninsula area with our very first San Mateo location, and to meet the demand in this booming community.”

The news of the lease comes weeks after New York-based WeWork also announced it would open a second location in downtown San Jose, meant to meet overflowing demand from its existing downtown location at 75 E. Santa Clara St. Amazon.com’s secretive Lab126 division leases some of the co-working company’s 75,000 square feet in Santa Clara Street building, and entrepreneurs and small companies have maxed out the rest of the space in the building.

 

 

Read more on Silicon Valley Business Journal