By Robert Sammons, Senior Director, Northern California Research
Credit Dionne Warwick for singing it and Burt Bacharach and Hal David for writing it. Obviously, since the song was recorded back in 1967, LOTS of folks have found their way to San Jose. Our Stories of the Week focus on the “capital” of Silicon Valley and the changes currently underway. As mentioned in our previous Newslines, there is a lot of development expected in and around Diridon Station – from office to retail to residential. More projects are or will be underway in North San Jose as well. And the primarily low- to mid-rise city may be going taller over the next decade due to zoning changes—though don’t expect something such as a Salesforce Tower to pop up down there.
A variety of local, national and international developers/investors have their eyes not just on San Francisco but on San Jose as well. Expect this market to look and feel much different in 2025+ than it does today thanks to all the transit-oriented development about to pop onto the scene.
Speaking of transit, there’s a great infographic-heavy story in the San Francisco Chronicle about the various transit projects underway around the Bay Area, including the new Central Subway and the BART extension for San Jose. There are some other “potential” projects included as well such as a second Transbay Tube that may or may not eventually happen.
And back in San Francisco, yet more big leases are being signed in the City with fewer and fewer big blocks left. In fact we count just 24 spaces available of 50,000 square feet and greater, with seven of those having deals pending. Making this metric even more interesting is that these spaces aren’t necessarily immediately available as occupancy dates range anywhere from mid-year 2019 through mid-year 2022. And nothing new is coming out of the ground anytime soon that hasn’t already been spoken for. Meanwhile, we wait and wait and wait for all the issues to clear regarding Central SoMa rezoning. Let’s not forget about the potential at Mission Rock and Pier 70, although we’re still holding out for a timeline on those as well.
Some venture capital firms that have been hanging out down in Silicon Valley, particularly in the vicinity of Sand Hill Road, are looking to relocate north to San Francisco. There’s a lot of sense to that as the start-up capital of the U.S. remains here at the northern tip of the peninsula. In fact, pre to early stage VC spending in 2018 was a record-high $7.1 billion just within San Francisco’s city limits thanks to the biotech and financial software categories, according to PitchBook.
Fred Ebb and John Kander wrote it and Frank Sinatra initially made it famous (though Liza Minnelli and Lady Gaga among others had their own takes on this classic tune). That would be New York, New York. And the reason I bring it up this week is the opening of Hudson Yards, billed as the “largest mixed-use private real estate venture in American history,” according to The New York Times. Yes, there is a LOT going on in one of the most powerful cities in the world. Will the heart of New York shift to the Far West Side or is this just another big piece in the puzzle? The photos in The New York Times article alone are worth a look – I hardly recognize my old neighborhood. Just a few blocks away, one long-time trendsetter is trying to bring a little bit of cool to what is known jointly as a giant tourist trap and the center of the best live theater on the planet. And that of course would be Times Square.
This post is commentary from the latest weekly edition of our NorCal Newsline, which you can subscribe to for free by e-mailing firstname.lastname@example.org.
Robert Sammons is Cushman & Wakefield’s Senior Director, Northern California Research. Based in San Francisco, Robert’s principal roles include working closely with the C&W research teams across the Northwest – including Northern California, Portland and Denver. Robert is author of numerous documents that delve into a wide variety of real estate and economic trends. He has been a quoted source for all manner of real estate and related economic information in many widely known media outlets across the country. Robert has 29 years of real estate experience as both an appraiser and researcher. He earned a BBA in Real Estate from The University of Georgia and an MS in Real Estate from Georgia State University. Robert is a member of the Urban Land Institute.