By Meghan Hall
An eight-story office building at the heart of downtown San Jose has traded hands, indicating that buyers and developers are moving forward despite current uncertainty about construction and COVID-19. In a transaction that closed just last week, SJ 121 Market, an affiliate of developer Jay Paul Company, paid $42 million, or $569 per square foot. The property was sold by Wells Fargo, according to The Mercury News, who first reported the transaction.
The property is located at 121 S. Market Street. According to public property documents, the building was originally constructed in 1970 and totals 73,800 square feet, while the lot itself includes 38,222 square feet of space. Wells Fargo currently occupies the ground floor and will move to another location at 50 W. San Fernando St. in the coming months. The property is another high-rise that Jay Paul Co. purchased in 2019 for $238 million, or about $660 per square foot.
Eventually, 121 S. Market Street is expected to become part of Jay Paul Co.’s Cityview Plaza: a 19-story mixed-use campus totaling 3.4 million square feet. San Francisco-based global architecture firm Gensler has been hired to design the project.
Jay Paul Co. is also in the process of moving forward with 200 Park, for which the developer received final approval for in October of 2019. The 875,000 square foot Class A office building will feature 26,000 square feet of outdoor terraces and is the first office high-rise in San Jose to begin construction on a speculative basis since Riverpark 2 in 2010.
Downtown San Jose has become a hub of redevelopment activity as major companies have set up shop. The Downtown San Jose Association is currently tracking more than 50 under construction, approved, under review or recently completed projects in downtown of various sizes. The organization estimates that there is some 16 million square feet of office space in the pipeline, compared with just 9 million square feet of current inventory. Big name companies are breaking ground on sizeable projects; Boston Properties broke ground on Platform 16, a 1.1 million square foot development at the beginning of March. Google has been working to fine-tune its plans for nearly 60 acres around Diridon Station, while KT Urban plans to construct 1.3 million square feet of space—either residential or office—on Woz Way in the coming years.