A recent article from The Mercury News reported that San Jose city officials are currently in the midst of creating multiple property deals aimed at attracting more tech companies to north San Jose. Evidently, the ultimate goal is to create a pleasant experience at Avaya Stadium and allow for a hassle-free development of Google’s transit-oriented village downtown.
According to the article, the city intends to sell land near the Coleman Highline complex across from San Jose International Airport. Officials are hoping this deal will trigger major new leases at the office, hotel, and retail project, while increasing parking for soccer games and other events at Avaya Stadium. Additionally, the city plans to proactively clear potential impediments to land Google will need for the complex that will be built downtown.
San Jose deputy director of economic development Nanci Klein said, “We are helping out with economic development at Coleman Highline with this property sale. It also helps lift a cloud that could hang over some of the Diridon (government-owned) sites” downtown near the proposed Google village.
City staffers have recommended that San Jose sell city-owned land next to Coleman Highline to the property owners, so developer Hunter Properties can create additional parking spaces for Avaya Stadium patrons and people working or shopping at Coleman Highline.
In a memo for the City Council, economic development director Kim Walesh wrote, “The sale price is $24.8 million, or $45 per square foot of land.”
So, how does this all affect Google’s village sites downtown?
John Fisher, a part-owner of the San Jose Earthquakes soccer club that plays at Avaya, and majority owner of the Oakland Athletics baseball team, is a primary partner in the Coleman Highline complex with Hunter Properties. Fisher is also principal owner of Athletics Investment Group, which controls options on key parcels downtown that, at one point, were set aside for Oakland Athletics’ baseball park, a project that eventually fizzled out.
Now, city officials want those same sites to bolster Google’s plans for its community, and the deal would require Fisher to relinquish his interests in the choice downtown San Jose parcels.
Klein explained, “As a condition to sell to John Fisher the land on Coleman Avenue, he is being required to release his options on the Diridon station properties.” Said sale is scheduled to be completed by the end of the year, and proceeds would potentially be used to pay for city-owned soccer fields.
Already, Roku and 8×8, both large tech companies, have leased large office spaces at Coleman Heights. In January, 8×8 signed a lease for 162,000 square feet, followed by Roku leasing 472,000 square feet just last month.
Walesh’s memo also mentions, “Coleman Airport Properties has commitments for 760,000 square feet of the 1.5 million square feet of office and research space entitled for the site,” and noted that ongoing discussions with other tenants “could achieve the full build out” of the project.
With additional parking, Coleman Airport Properties can more easily attract tenants to the site’s remaining space.
The city memo goes on to explain, “Without access to the additional land, the developer will likely under build the office component of the site by 350,000 to 400,000 square feet to retain more surface parking or build larger parking garages.”
City officials are concerned that without more parking spaces, office workers, retail patrons, and hotel guests could experience increasing difficulty in accessing both Coleman Highline and Avaya Stadium.
Klein said, “Almost half of the office site would have to clear out by 6 pm to accommodate the obligation to provide 5,000 parking spaces on a game night. That is a significant obligation. Because of traffic concerns, it is common that a number of patrons arrive by 5 pm.”
(Read the full article on The Mercury News.)
Have You Invested In San Jose Real Estate?
With more tech companies coming to the area, there’s never been a better time to own a rental home, and the right property managers can help you make the most out of your investment. Intempus has proudly provided outstanding property management services throughout the Bay Area for years!
If you’re interested in learning more about our services, please contact our friendly staff today!
