Netflix Has Right To Terminate Los Gatos Lease

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Companies want to become embedded in a community along with their workers, so they don’t lose good talent as a result of an unwanted move, brokers said. Young companies with visions for growth, though attracted to the quality of life, don’t want to come to Los Gatos because there is no expansion space. “If it isn’t approved, it will say that Los Gatos can’t handle your growth,” said Mike Charters, a Los Gatos homeowner and commercial property broker for CBRE Inc. who represents a number of tenants in west Silicon Valley. “This is an incredible opportunity for the city. We are talking about Netflix, but it is a large project, and it could house more.”

[contextly_sidebar id=”ad555c1bd918a46a37efa9424b757b9d”]Dozens of citizens spoke to all sides of the redevelopment over the course of a five-hour public hearing, which the council extended as the meeting closed in on midnight. In general, long-term residents were more opposed to the project, citing the buildings’ 65-foot height as contrary to Los Gatos’ small-town character and general plan, while newer residents and people with school-aged children favored it for the revenue for schools. More than one speaker asked the Town Council for its proposals to replace the revenue produced by Netflix if it left. The five-member council did not respond; indeed, the council almost did not speak at all.

Besides Chief Financial Officer David Wells and the company’s head of facilities, three Netflix executives uninvolved in the real estate process but who live in Los Gatos and own homes in the community also spoke out. Todd Yellin, vice president of product innovation at Netflix, said he moved to Los Gatos more than seven years ago after being recruited by the company; he recently bought a Los Gatos home. He commutes to work by bicycle and questioned sentiments that the campus would represent a step back for the town rather than signal of renewal.

I want Netflix to stay in this town. I want to keep that short commute and stay in this great community. There is a lot of wishful thinking that we can have our cake and eat it too. I am afraid [Netflix] might have to leave if we don’t have a better facility. This will be a lovely new building,” he said.

At the same time, at least eight professionals in the Silicon Valley commercial real estate industry also spoke in support—four said they were Los Gatos residents, including Gary Filizetti, head of Devcon Construction Inc., and Anne Ralston, a senior vice president for Cornish & Carey Commercial. “I fully believe Netflix will leave town if we don’t support this,” Ralston told the Town Council. She has lived in Los Gatos for 20 years and has no business interests in the Netflix campus. “I don’t want this to be a bedroom community, or Saratoga. I like the vibrancy of Los Gatos, and I think this project will add to it,” she said.

The Los Gatos town staff endorses the project; the planning commission is opposed.

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