SAN JOSE — A housing development with hundreds of units may sprout on a downtown San Jose parking lot, a revamped plan that shows how a tough economy has unleashed dramatic shifts in Bay Area real estate.
Westbank, a mega-developer with a worldwide reach, has proposed a big housing development that would replace an office and housing project on the site that was proposed a few years ago at 35 South Second Street.
The new version of the proposal envisions 768 housing units on the site, according to documents on file with the San Jose Planning Department.
“We are excited to have submitted an application for the Energy Hub, with a new majority residential development scheme,” said Andrew Jacobson, principal executive for Westbank’s U.S. operations.
The Energy Hub project site totals 1.25 acres and is next to Fountain Alley, a bustling restaurant strip between South Second Street and South First Street.
Canada-based Westbank is teaming up with famed architectural and design firm Bjarke Ingels Group to craft the look and feel of the proposed housing development.
The Fountain Alley housing project would also include about 10,700 square feet of retail spaces on the ground floor, the planning documents state.
The revamped proposal for the Energy Hub project is in the very early review stages in San Jose.
“We’re looking forward to continuing to work through the permitting process with the city of San Jose,” Jacobson said.
Westbank has proposed several projects in downtown San Jose, which the real estate firm describes
Earlier this month, Westbank proposed to pivot away from an office and retail tower at 255 West Julian Street, a project that had been proposed for a site next to the prominent Davidson Building in downtown San Jose.
Westbank also has shifted strategies for the Bank of Italy historic tower at 12 South First Street, which is around the corner from the Energy Hub development in Fountain Alley.
Instead of creative workspaces, the Bank of Italy’s offices are being converted into residential units.
The Bay Area office market’s forbidding landscape of sky-high vacancy rates, tech industry layoffs and feeble rents have prompted more developers to scrap office projects or even bulldoze existing office buildings to pave the way for large new residential projects.
Over the 12 months that ended in July, tech companies chopped employment by 16,000 jobs, according to a Beacon Economics estimate of seasonally adjusted numbers compiled by state government officials.
The layoffs have greatly crimped the tech sector’s appetite for Bay Area office space.
In the face of these brutal circumstances for the office market, savvy developers such as Westbank have pivoted to housing projects.
Westbank’s new vision for the Energy Hub site in Fountain Alley will bolster economic activity in San Jose’s urban core, in the view of Bob Staedler, principal executive with Silicon Valley Synergy, a land-use consultancy.
“Converting office buildings to residential units will help improve the vibrancy of downtown San Jose,” Staedler said. “Density in urban locations near transit will continue to be a win-win for both developers and the City of San Jose.”
Source: www.mercurynews.com