North San Jose: Next Boomer in the Real Estate Market
When you mention North San Jose, it brings to mind quiet residential areas and scattered office buildings. However, this image might soon change into that of a more brisk, urban technological hub. At the same time, the real estate market in North San Jose has great potential to jump in the next few years.
San Jose’s city government is actively attracting high-tech companies and developing the city’s transportation. It recently helped the South Korean electronic giant Samsung with the expansion project of its R&D headquarters in North San Jose. Commercial brokers have also been active in the area. In addition, the VTA will be connected to BART so that San Jose is directly connected to San Francisco.
All of these changes will transform North San Jose into a vibrant epicenter of technology.
The current price of a four-bedroom house in the area is around $700,000. North San Jose is still considered a reasonably priced area compared to other parts of Silicon Valley. Taylor Morrison built a townhouse community in the Berryessa area, and the agent said that a total of 53 units sold out within half a year—and with a substantial price raise.
The San Jose government keenly supports the growth of tech companies and uses tax policies and exemption of large fees to encourage them to stay in the area. Recently, the San Jose mayor, Chuck Reed, approved a $7 million incentive package for Samsung Semiconductor for its expansion on North First Street.
Samsung will build a modern 10-story building on its current location on Tasman Drive and First Street. They plan to finish the project in two years, and it is said that the new building will have space for more than 2,000 employees.
These newcomers will help power the housing market, but they won’t be the only new blood in the area. The San Jose government aims to transform North San Jose into a brisk, upscale commercial area. The government is creating policies to help high-tech companies reduce their costs and help developers build modern office buildings that will meet future growth trends. It is also emphasizing transportation.
A lot of money is being put into the VTA-BART project to connect San Jose directly to San Francisco with public transportation. By 2017, the Berryessa VTA station will be connected to the Fremont BART, encouraging more tech people to stay in the area.
High-tech companies are growing rapidly in Cupertino, Mountain View, Palo Alto, and Menlo Park. North San Jose is probably the last city in Silicon Valley to have large lots at reasonable prices.
Mayor Chuck Reed has said that many companies are looking for spaces larger than 50,000 square feet. It seems as though many developers also believe in the potential of North San Jose to become a modern commercial center of technology. Many large investment companies and developers are acquiring land to renovate office buildings in the area.
Rob Shannon, senior vice president of CB Richard Ellis real estate group, told San Jose Mercury News that he predicts North San Jose’s commercial market will be very strong and will last until at least 2014.
Ellis Partners has bought a 300,000-square-foot building and the land around it. They plan to build an office building with 1 million square feet of office space, and at the same time remodel the old building to make it look more modern.
Another developer bought 30 empty lots from Cisco with room for a 600,000-square-foot office building that can fit 3,000 people.
These trends show that North San Jose is sure to become a modernized intersection of technology.
In addition, with improved transportation and the strong support of the city government, many more technology talents will be brought to the high-tech firms. These people will be the power behind the real estate market in North San Jose.