Golden Triangle Shines in North San Jose

San Jose, Silicon Valley, TA Associates Realty, South Bay Development, PCCP, Eastdil Secured, CBRE, VTA, commercial real estate, Golden Triangle

Golden Triangle San Jose The Registry real estate

By Robert Carlsen

The term “Golden Triangle” harks back to a mysterious and perilous Southeast Asian geography that defies time. It’s also a place that defies law being one of two primary locations in Asia where illicit drugs are produced.

There is a slice of Silicon Valley flanked by Highways 101, 237 and 880, and incorporating parts of Santa Clara, North San Jose, Sunnyvale and Milpitas that bears the same name. The golden moniker is an appropriate descriptor given the level of commercial, residential, retail, entertainment and hospitality real estate projects under way in this small region.

Major tech players such as Google, Cisco, Samsung and others are spreading out in rapid succession here. And they are just the tip of the proverbial iceberg.

According to San Jose Mayor Chuck Reed, the city put together a task force 20 years ago to study economic development opportunities in the fledgling Triangle, which was showing great promise in attracting burgeoning technology companies.

Today, the area represents nearly 23 percent of all Silicon Valley office and R&D developments currently underway (or 1.6 million square feet out of 7.1 million square feet); it is a total of 10 major construction and renovation projects, according to Amber Schiada, research manager/Northern California for Jones Lang LaSalle, San Francisco.

Levi’s Stadium, the new home of the San Francisco 49ers and host to Super Bowl L, is only one of the major projects under construction in the region. It was a major coup for the city of Santa Clara to win it, but in reality the larger opportunity lies with the accompanying projects surrounding it.

Coming online first is the 800,000 square foot Centennial Gateway project, a $400 million complex of two hotels with 235 rooms, 430,000 square feet of office space, entertainment and specialty retail space and restaurants, including a Joe Montana signature eatery, on a 9.5-acre city-owned parcel at Tasman Drive and Centennial Boulevard, adjacent to the stadium. The development group is comprised of Montana Property Group and Lowe Enterprises.

A first phase of most of the retail and hotel space, along with 350,000 square feet of office space, is expected to open by February 2016, when the stadium will host Super Bowl L. NBBJ is serving as master planner on the project and Turner Construction is the general contractor.

The other project, developed by Related California, is a new City Center plan that combines 1.5 million square feet of retail space, 2.4 million square feet of commercial space, 530 residential units and a 200-room hotel. The development is currently planned for a site just north of Levi’s Stadium, adjacent to the Santa Clara Convention Center and near California’s Great America amusement park.

“Both projects are quite complex, particularly when putting them together into one cohesive plan,” according to Kevin L. Riley, director of planning and inspection for the city of Santa Clara. “The emergence of the Related project may have highlighted some challenges for the Montana project, but at the same time it has made the viability and success of the Montana project more assured by a much greater critical mass of complementary uses. The development challenges are vertical as well as horizontal when you think about engineering and construction issues, insofar as the Related project will likely be atop a podium over the landfill.”

Timing wise, the EIR stage for both projects will take approximately 12 to 15 months. “The city is very good at moving projects expeditiously, and it will certainly be a priority for these projects,” Riley said. “That said, the landfill constraints, the existing golf course operation, convention center needs and other external issues cannot be overlooked in getting this done. There are a lot of yards to that goal line and every play in the drive matters.”

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