Boom City — Downtown development proposals pour in

(First reported June 2016)

Updated May 2018.

 

Development proposals continue to descend upon downtown San Jose at record pace and now record size. Unlike the previous cycle of growth that focused on high-rise housing, downtown is clicking on all four cylinders: housing, office, hotel and retail.

How many of the proposals will garner approvals and investor funding and result in completed buildings is anyone’s guess. Several of the developments that first appeared in the mid-2000s are back with new plans. Given the current strength of the Silicon Valley market, many developers are fast-tracking projects with hopes to begin construction this cycle. If downtown’s development record is any indication of its future, more than half the proposals outlined below will happen over the next decade, altering downtown’s landscape for the next century.

OFFICE

 
Downtown San Jose has less than 9 million square feet of office space. Three new proposals for downtown San Jose would more than double the amount of office space:

• Google has several parcels in the area around the Diridon Station and SAP Center, and is negotiating with the city for 11 more parcels (See lists at end of story.)

Google is interested in working with the city to bring 8 million-10 million square feet of office space to the area, plus housing, retail and amenities, the amount of which is unspecified.

“Just to get the sites together by itself is obviously very complicated, and it’s not completed yet, and it’s taking a while,” said Mark Golan, Google’s vice president of real estate development, at a meeting of the recently formed city advisory group. “But we are getting close to having a site that is viable.”

• Google in March 2018 acquired the City Council-approved 850,000-square-foot office development along Guadalupe River at the former San Jose Water Company site near the arena originally proposed by Trammell Crow and Bentall Kennedy. The approved mixed-use development includes two distinct buildings, a third “connector” structure that allows for larger floor plates to match tech tenant needs, plus generous plaza and commercial spaces fronting 402 W. Santa Clara St.

• The 2.5-acre property at 335 W. San Fernando adjacent to Highway 87 has been purchased by Adobe, which announced plans to build a fourth headquarters tower that would add capacity for another 3,000 employees. The company is expected to start designing the 700,000-square-foot building in 2018.

• Bay Area developers Valley Oak Partners and TMG Partners proposed a 1,023,000-square-foot campus that stretches along the new Autumn Parkway between San Jose MarketCenter and the arena, on land formerly known as Akatiff parking. The developers have submitted a request to begin construction.

The Family Justice Center opened for business Aug. 15, 2016, at Market and St. James streets. The building is 234,000 square feet. Until the Family Justice Center opened, the last office building completed downtown was the RiverPark II Tower, 318,000 square feet, at 300 Park Ave., in 2010. It is now 85 percent occupied.

One multi-use building, Miro, at Fourth and Santa Clara streets, SJSC Properties across from City Hall, is under way with 25,000 square feet of office.

Other office buildings with plans submitted include:

• River Corporate Center by Sobrato, off Julian Street, 204,000 square feet, which will be the third building in the center leased by Santa Clara County. Foundation work is under way.

• Railyard Place by Insight Realty, off Highway 87 and Coleman Avenue, 250,000 square feet.

• The Museum Place project at Park and Almaden avenues has a timeline, with the city and developer Insight King Wah LLC agreeing to complete the mixed-use office (263,676 square feet of office), residential, hotel, Tech museum expansion and parking project by 2023.

Two more commercial developments of interest to the downtown community include:
• Creative Center for the Arts, future home to a number of arts groups, including the Ballet School, inside a 60,000-square-foot building at Jackson and North 7th streets, developed by SV Creates.
• Across the railroad tracks on Stockton Avenue north of Santa Clara Street, Vespasi @ Diridon, a 37,500-square-foot commercial project, is under construction, according to city reports.

HOTEL

 
The total number of hotel rooms downtown could spike more than one-third if several projects are built out. Khanna Enterprises, which owns the Sheraton Four Points on First Street, wants to construct a 21-story, 186,426-square-foot cantilevered tower over the original 1911 Montgomery Hotel frame. The plans by TCA Architects call for an additional 280 guest rooms rising 245 feet, with a roof-top bar, pool and fitness center. The unusual design suggests that the first six floors form the base and floors 7-21 extend slightly over the existing historic structure.

The new part of the future Tribute hotel would face south and be covered in glass. The old 86-room hotel is 187 feet south of its original location. The city’s Redevelopment Agency paid $8.6 million to move the structure in 2000 to make way for the Fairmont Hotel annex. Khanna obtained the property from Joie de Vivre Hotels in 2008.

Also:

• Owner Nimish Patel of the vacant parcel at South Second and Reed streets propose a six-story, 76-room hotel in SoFA;

• A 210-room AC Hotel opened at Santa Clara Street and Highway 87 in early 2017.

• Hotel Clariana also opened in 2017. The 44-room boutique-style hotel was renovated from a former YMCA at Second and Santa Clara streets. Owner RSTP Investments, LLC, plans to add another 60 rooms, plus pool and new lobby totaling 51,573 square feet on the parking lot it owns adjacent to the hotel between Third and Fourth streets

• The Museum Place property next to The Tech will host a Kimpton Hotel of up to five floors, 184 rooms and 203,207 square feet. The City Council reached agreement with developer Insight King Wah, LLC in August 2017.

• Kade Development subsidiary Diridon Hospitality LLC intends to build a hotel at Stockton and Julian near the arena and Google development. It would include 254 rooms, plus 19 residential units in nine stories.

• The latest hotel proposal is by KT Urban, which wants to build a 19-story hotel of 220 rooms on a 0.2 acre (8,000 square-foot) site between the Hotel De Anza and Axis residential tower at Notre Dame Avenue and Santa Clara Street. The hotel would not have any dedicated parking, but valet service using local parking garages and lots. Plans include a restaurant or bar on the ground floor and rooftop patio with inside/outside seating.

If built, the total uptick of about 1,074 rooms would bring the number of rooms available in downtown San Jose to 3,200. That does not include a 54-room inn proposed at Stockton and Schiele Avenue.

HOUSING

 
Residential development is still a hot sector with 10,520 homes proposed, under construction or recently completed for 36 different sites downtown – most of them high-rises.

Within a half-mile of downtown, many on the developing West Side, another 20 projects are in the works, totaling another 3,016 units, according to city reports.

In December 2016, the City Council extended the 50 percent reduction in construction taxes and parkland fees to downtown developers who begin construction before July 2018. Five projects – Miro, ParkView Towers, North San Pedro Tower, The Graduate and Aviato are eligible to receive the housing incentive.

Housing that has been entitled or is in process:

• 225 W. Julian St. by DAL Properties near Highway 87, 910 units, two 20-story towers.
• Platinum Towers/Greyhound site by KT Urban, 708 units, two towers, 24 and 23 stories.
• Railyard Place by Insight Realty, 650 units.
• Block 3 by Sobrato, next to the Hammer Theatre, 399 units;
• SJ Water Co. site (Santa Clara and Delmas) 325 units approved. In April 2018, Google acquired the property from Trammell Crow and Bentall Kennedy.
• 27 S. First St, called for now 27 West, by the Bader Family and Alterra International, 350 units. Local Color has temporarily filled the commercial space that is to be razed.
• Gateway Tower by CORE Companies, at South First and William streets, 276 units;
• Parkview Towers by Full Power Properties on the north side of St. James Park, 220 units. A ground-breaking ceremony took place on the site, but not much activity since.
• Sixth Street flats by owner, 195 units;
• Museum Place by Insight King Wah, 306 units. The City and Insight reached agreement on the development timeline in August 2017.
• Post and San Pedro Tower, by Simeon Residential Properties and Kinship Capital, 182 units;
• 439 S. Fourth St., by property owner, 108 units;
• Garden Gate, 600 S. First St. (at Reed Street, on the current Garden City Construction Co. location), by KT Urban, 285 units;
• 100 N. Fourth St. at St. John, by ECI2 North Third, LLC, 400 units;
• CityView Plaza expansion by Equus Capital Partners at 170 Park Ave., 264 units;
• Almaden/Balbach affordable apartments, 87 units. Berkeley-based Satellite Affordable Housing Associates (SAHA) proposes an 87-unit, eight-story building on the city parking lot. Rents would be below-market rates to people who earning less than approximately $80,000 per year.

 

Brandenburg/North San Pedro housing:

• Realignment of Devine, Julian, Terraine and North San Pedro streets is complete. Infrastructure work ongoing. Projects include: Block E by Swenson, 300 units, (no plans yet); Trumark Homes town-home projects on Blocks A. C and D, 78 units; First Community Housing residential service facility for veterans and special needs individuals on Block G, 135 units; and Intracorp Companies on Blocks B and F, 380 units. A total of 893 units.

More North San Pedro Area projects:

• Silvery Towers by Full Power Properties LLC, St. James and San Pedro streets, 643 units.
• Aviato @ North San Pedro, 199 Bassett St., by KT Urban, 302 units. This development would be in addition to the other North San Pedro projects already entitled.
• North San Pedro Tower 3 by Full Power Properties LLC, 323 Terraine St., 305 units.
• Davidson Plaza Towers by Tony Arreola and Mark Lazzarini, 255 W. Julian St., 653 units.

Units under construction:

• Marshall Square at North First and St. John streets, by Fairfield Residential, 190 units.
• 180 Balbach condominiums, by Silicon Sage, 100 units.
• Miro, by SJSC Properties, at Fourth and Santa Clara streets, 610 units on twin 28-story frames.
• Modera by Mill Creek at San Pedro Square, 204 units.
• The Graduate, 300 S. Second St. (student housing) by Barry Swenson Builder and Amcal, 260 units;
•SparQ, 598 S. First St., by CORE Companies, 105 units. This project began in fall 2017;
•Villas on the Park, 278 N. Second Street (at Devine), by PATH, 75 units. Demolition complete, groundbreaking occurred in spring 2018.

Units recently completed include:

• Campus Village Phase II at San Jose State University, 425 double rooms, opened for the fall 2016 semester.
• The Pierce, 60 Pierce St., by Sares Regis, 232 units, opened February 2017.
• 27 North Sixth St. (student housing) by Symphony Development, 119 units, opened 2017.
• Donner Lofts by MidPeninsula Housing, at Fourth and St. John streets, 102 units, opened March 2017.
• Plaza Hotel housing by the City of San Jose, at San Fernando Street and Almaden Avenue, 55 units, opened January 2018.

On downtown’s periphery within one-half mile

According to city planning reports:
Under construction: Fairfield at West San Carlos (and Sunol), 315 units; 777 Park Ave (at Laurel Grove) 182 units; 787 Modera The Alameda (at Stockton) 168 units; Hanover Cannery (10th and Taylor) 403 units; Vespasi @ Diridon (Santa Clara and Stockton) 164 units.
Approved projects not yet under way: 363 Delmas Ave (near Auzerais) 120 units; Ohlone Blocks A, B and C (at Sunol and San Carlos, Sunol and Auzerais, 789 units; Montgomery 7 (at West San Carlos) 54 units; Sparta (Santa Clara and 11th) 85 units; Japantown Corporation Yard, 520 units; 777 W. San Carlos St (at Sunol) 149 units; 7th and Empire, 92 units; Park Delmas, 123 units.
Pending projects: Spartan Keyes Senior Housing (Virginia and 7th) 301; 425 Auzerais (at Delmas) 130; 740 West San Carlos (near Sunol) 95 units; 750 West San Carlos, 56 units; Dupont Street Mixed Use (at Park and McEvoy) 458 units.

A decade ago

Ten years ago, plans were unveiled for 18 properties totaling 3,598 units. Of those proposed, nine properties were built, including four high rises, and smaller developments on Balbach Street, North Second Street and Julian Street. Five locations dedicated to housing a decade ago still have plans on them, including North San Pedro, Marshall Square, Parkview Towers, 200 Park Ave. and Donner Lofts. Ten years ago, developers proposed 1,455 dwellings units on these sites – now 1,948 units are planned on them.  

RETAIL
 

Most new housing and office buildings proposed include retail components on the ground floors. Retail square footage proposed for all development is more than 250,000 square feet (sf).
 
Size varies. For example: SJ Water Company site, 30,000 sf; Miro, 21,000 sf; Museum Place, 21,000 sf; Silvery Towers and North San Pedro area 20,000 sf; Parkview Towers, 18,500 sf; 27 S. First, 17,268 sf; SJSC site, 15,000 sf; Greyhound site, 14,000 sf; Marshall Square, 11,000 sf; Aviato, 10,146 sf; Gateway Tower, 10,000 sf, Modera, 9,200 sf; Post-San Pedro Tower, 9,000 sf; 100 N. Fourth, 8,500 sf; Garden Gate, 6,105 sf; Gateway Tower, 6,000 sf; 27 S. First St., 5,100 sf; The Pierce and 439 S. Fourth, 4,300 sf; SparQ, 3,000 sf; Donner Lofts, 2,700 sf; North San Pedro Tower, 2,000 sf; CityView Plaza expansion, 1,500 sf; Davidson Plaza Towers, 10,254 sf..
 
Diridon Station area acquisitions since Trammell Crowe purchased the SJ Water Co. site in 2015
 

Date Address Land area in sq./ft. Buyer Cost Cost sw./ft/
11/12/2015 250 Stockton 1,040,108 Imwalle Annex HBD, LTD $10 million $96
7/27/2016 92 S. Montgomery 8,890 Imwalle Annex HBD, LTD $612,750 $69
12/22/2016 145 S. Montgomery 174,818 Rhyolite $55 million $314
1/3/2017 59 and 75 S. Autumn 8,050 TC Agoge Associates, LLC $665,000 $82
2/14/2017 52 S. Autumn 13,500 TC Agoge Associates, LLC $2.235 million $165
3/14/2017 35 S. Autumn 5,650 TC Agoge Associates, LLC $1.2 million $212
4/6/2017 450 W. Santa Clara 22,080 TC Agoge Associates, LLC $11 million $490
4/6/2017 24 S. Autumn 6,650 TC Agoge Associates, LLC $1.35 million $203
4/6/2017 34 S. Autumn 6,650 TC Agoge Associates, LLC $1.35 million $203
4/13/2017 74 S. Autumn 5,865 TC Agoge Associates, LLC $1 million $170
5/23/2017 587 Cinnabar 297,297 TC Agoge Associates, LLC $51.5 million $173
6/14/2017 559-573 W. Julian 8,455 TC Agoge Associates, LLC $3.625 million $428
6/15/2017 20 S. Autumn 13,939 TC Agoge Associates, LLC $2.75 million $197
6/23/2017 691 W. San Carlos 7,760 TC Agoge Associates, LLC $4.6 million $592
6/28/2017 S. Montgomery 5,563 TC Agoge Associates, LLC $4.6 million $826
6/30/2017 140 S. Montgomery 26,658 TC Agoge Associates, LLC $5.5 million $208
8/1/2017 92 S. Montgomery 8,890 TC Agoge Associates, LLC $1.1 million $124
8/8/2017 59 S. Autumn 14,375 TC Agoge Associates, LLC $3.2 million $223
12/21/2017 551 West Julian 5,662 TC Agoge Associates, LLC $650,000 $115
1/3/2018 195 N. Autumn St. 5,500 TC Agoge Associates, LLC $650,000 $118
1/16/2018 292 Stockton 37,400 Kade Development $4 million $107
2/15/2018 570 Cinnabar St. 105,000 TC Agoge Associates, LLC $32 million $305
3/28/2018 377 Royal Ave 190,000 TC Agoge Associates, LLC $39.55 million $208
4/6/2018 Delmas and Santa Clara 370,260 Trammell Crow Price not yet public NA
4/17/2018 240 and 250 N. Montgomery St. 15,180 TC Agoge Associates, LLC $1.9 million $125

* Acquired from the Successor Agency
 
Source: Santa Clara County Assessor/Records offices
 
Properties held by the City of San Jose now in Exclusive Negotiations Agreement with Google:
 
255 S. Montgomery St. (SJFD fire training) Approx 230,000 sf
8 S. Montgomery St. (arena parking) 44,000 sf
102 S. Montgomery St. (former ball park site across from Stephen’s meats) 6,235 sf
 
510 W. San Fernando St. (former ball park site across from Stephen’s meats)
150 S. Montgomery St. (former ball park site across from Stephen’s meats)
105 S. Montgomery St. (former Stephens meats / ball park site) 153,500 sf (three addresses combined total)
 
645 Park Ave. (former ball park site) 70,262 sf
525 W. Santa Clara St./566 W. Julian Sat. (arena and parking) Approx 500,000 sf
697 W. San Carlos St. (separated from fire training site by Los Gatos Creek) Approx. 14,000 sf