At a CREW Silicon Valley luncheon, deputy city managers from Santa Clara, San Jose, and Sunnyvale laid out an aggressive playbook: defer fees, fast-track approvals, and build enough electrical infrastructure to triple capacity — all while a FIFA World Cup lands on their doorstep.

Silicon Valley has spent the better part of three years wondering when the other shoe would drop on its commercial real estate market. On Tuesday, three of the region’s most senior city officials made the case that it already has — and what landed was not a crash, but a pivot.

At a CREW Silicon Valley panel at the Hilton Garden Inn in Sunnyvale, Deputy City Managers Reena Brilliot of Santa Clara, Manuel Pineda of San Jose, and Connie Verceles of Sunnyvale offered a detailed accounting of what is working, what is stalled, and what they are doing about it. Moderated by Vladimir Bosanac, co-founder and publisher of The Registry, the conversation moved briskly through sports economics, housing production, commercial leasing, and the infrastructure arms race reshaping the South Bay. The takeaway was clear: these cities are not waiting for the market to come to them.

Half a Billion Dollars in a Weekend — and More Coming

The panel opened with a subject that doubles as both civic pride and economic strategy. Super Bowl LX, held earlier this year at Levi’s Stadium in Santa Clara, generated an estimated $500 million in regional economic impact. The FIFA World Cup, arriving this summer with 6 matches at the stadium from June 13 through July 1, is expected to produce a comparable figure and draw roughly a quarter of a million visitors.

For Santa Clara, the value extends well beyond hotel receipts. “When I travel around the world, and I try to identify where I’m from, I can say, home of Levi’s Stadium,” Brilliot said, describing the broadcast exposure as a form of global brand-building that no marketing budget could replicate.

San Jose captured its share. Pineda said the city drew tens of thousands of unique visitors during Super Bowl week. A 3-day Super Fest event attracted nearly 50,000 attendees, and concerts at the plaza across from City Hall brought 25,000 more. “We were able to really break records,” he said.

Even Sunnyvale, which lacks a stadium, found something to cheer about. Diego Luna, a Sunnyvale native, is on the short list for the U.S. men’s soccer team roster. “If he makes it, you will hear balloons and the cannons at city hall,” Verceles said. “Even though we are the heart of Silicon Valley, we’re still a small city that values our residents.”

The Housing Math: Record Approvals, Stubborn Economics

The optimism dimmed slightly when the subject turned to housing — not for lack of ambition, but because of arithmetic that still does not pencil for many developers.

Sunnyvale completed 1,400 units in 2025, its best year on record, along with 475 accessory dwelling units. The city faces a Regional Housing Needs Allocation of more than 12,000 units by 2031, over a 100 percent increase from the prior cycle. Verceles was candid about where the bottleneck sits. “Right now, it’s not necessarily policy or regulation. Right now, it’s construction cost. It’s finding labor,” she said. The city’s specific plans have capacity for approximately 24,000 units — the zoning is there, but the cranes are not.

San Jose is trying to close the gap between entitlement and construction with targeted financial relief. Pineda described new fee-deferred mechanisms that would allow developers to pay city fees at occupancy rather than at the start of construction, reducing the carrying cost of development loans. The city is also building a regional stormwater treatment program to relieve individual high-density projects of costly on-site requirements, particularly in downtown parcels where space is already at a premium. “We’re looking at near-term things we can implement now that kind of make that financial outlook work for people who move forward from that stage of entitlement to actually doing construction,” he said.

Santa Clara posted what Brilliot called a “gangbuster year” in 2025, completing 10 large multifamily high-rise projects across the city. “I just cannot underscore the year we had in 2025,” she said. “Certainly our greatest year on record.” She credited years of upfront planning. “We put a lot of investment in planning, which has streamlined the process for people, and that kind of is a big part of our story for why we got so many numbers,” she said.

Much of that momentum was concentrated in the Clara District near Levi’s Stadium, where the city had worked closely with developers over several years to create an implementable plan. Pineda, who collaborated on the district during his earlier tenure in Santa Clara, emphasized the depth of that partnership. “We literally met biweekly, every 2 weeks for a couple of years, figuring out all the issues to make sure those projects can move forward,” he said.

The city’s most consequential near-term move may be its deferral of park impact fees — often the single largest fee a developer faces. Brilliot said the council-approved policy, which pushes payment to certificate of occupancy, directly enabled a project by developer Ensemble called Parkside to break ground in the Clara District. “In Santa Clara, that is almost always our largest fee — millions and millions of dollars that people need to pay, typically, upfront before you even put a shovel in the ground,” she said.

Looking ahead, Brilliot previewed plans for a 5-acre city-owned site in downtown Santa Clara, across the street from Santa Clara University and near the future BART station. The city intends to solicit development proposals later this year, but it is not looking for a conventional project. “We’re not just looking for housing. We’re not just looking for retail. We’re really looking for placemaking that’s going to build the momentum for other properties to develop,” she said. “We’re asking the developer who comes in to be a partner at the table with us.”

Office Leasing: The AI Tailwind Is Real

If housing remains a grind, commercial leasing in Silicon Valley is experiencing something closer to a renaissance — driven overwhelmingly by artificial intelligence.

In Santa Clara, NVIDIA continues to expand its headquarters campus with the construction of Starbase, an amenities building, and plans for a 600,000-square-foot building called Enterprise. The company has spent close to $1 billion acquiring properties near its headquarters over the past year, according to CoStar. But Brilliot’s favorite story of the year involved a different company entirely. A residential developer had acquired a 14-acre office site on Peterson Way and planned to convert it to townhomes under a state housing law. Palo Alto Networks outbid the project and will use the site for its intended purpose. “That’s a really good story, and it’s turning — like, hey, things have a bright future for office here in Silicon Valley,” Brilliot said.

She also noted that Sutter Health has acquired 2 campuses on Mission College Boulevard and announced plans for an 8-story full-service hospital — a signal that the demand for commercial space extends beyond tech. And Related Companies, which has been working with the city since 2016 on a 240-acre mixed-use project across from Levi’s Stadium, recently reentitled a portion of the site from office to light industrial to accommodate advanced manufacturing or data center uses.

Sunnyvale’s story is one of depth, not dependence on any single tenant. Databricks has leased over 635,000 square feet in the city, anchoring the Cityline development downtown. CBRE data showed Silicon Valley recorded 2.9 million square feet of positive net absorption in the fourth quarter of 2025, with office vacancy declining for a fifth consecutive quarter to 16.1 percent. CrowdStrike signed a significant downtown lease. Uber has been operating in the city for 9 months and, according to Verceles, its employees prefer Sunnyvale to the company’s San Francisco headquarters. “They’re not coming to a building, they’re coming to an experience,” she said. “They can go to the movies, they can go to a happy hour afterwards, they go to Target, they can go to Whole Foods. It’s a whole ecosystem.”

Beyond downtown, Google Cloud moved into a new 1 million-square-foot facility in Moffett Park. Snapchat is expanding into Peery Park. Apple has purchased and is improving significant building stock. Intuitive Surgical operates a 1 million-square-foot manufacturing facility. Fortinet recently occupied its new building. And Applied Materials is building what Verceles called the “EPIC Center,” a facility so sensitive the city is developing a separate security plan. “We are not focused on just one company,” she said. “I think that’s one of our secret sauces.”

Verceles also highlighted the Cityline project’s long arc as a testament to persistence. The development endured bankruptcy, multiple market cycles, and institutional turnover — “seven city managers and 33 council members since 2001,” she noted — before reaching completion.

The Power Play: Tripling the Grid

Beneath the leasing headlines lies a less glamorous but arguably more consequential competition: the race for electricity.

Pineda detailed San Jose’s landmark implementation agreement with PG&E, a first-of-its-kind deal between the utility and a municipality designed to triple the city’s power capacity from approximately 1,000 megawatts to 3,000 megawatts. Two new transmission lines totaling approximately $2 billion in construction are expected to begin this year, delivering 2,000 new megawatts to the South Bay. The first data center under the agreement — an Equinix facility in South San Jose — came online in January. PG&E expects to connect 15 data centers in the South Bay within 5 years, creating an estimated 25,000 jobs and generating $227 million in property taxes and $390 million in sales tax revenue. “What I’d like to tell people is that’s more electrical infrastructure where you’ve seen in the next 5 years than you probably saw in the last 15 years combined,” Pineda said, with more than 20 data center projects in the city’s pipeline.

Brilliot countered with Santa Clara’s trump card: Silicon Valley Power, the city’s own municipal electric utility, now celebrating its 130th anniversary. The city has 55 data centers, with 2 under construction. The utility generates approximately $41 million annually for city coffers through a 5 percent transfer on electric revenues. “If you walk away with anything about Santa Clara, you should know that, because it has really competitive rates, super reliable power, and it makes us stand out,” Brilliot said.

The utility recently earned a national reliability award from the American Public Power Association, with Santa Clara customers experiencing an average of just 69 minutes of outage time in 2025, compared to more than 520 minutes nationally. Brilliot added that the utility’s customer service model assigns a dedicated representative to prospective tenants — a level of hand-holding that PG&E’s scale does not typically permit.

The Bottom Line

The panel conveyed a consistent message: Silicon Valley’s cities are pulling every lever within their control — fee deferrals, ministerial approvals, stormwater programs, power grid expansion — to keep development moving despite macroeconomic headwinds. Whether the current momentum translates into sustained construction will depend on forces largely outside their grasp: interest rates, labor availability, and the durability of the AI-driven demand cycle that has breathed new life into the region’s commercial markets. But for the moment, the officials on stage were not hedging. They were building.