https://www.mercurynews.com/2019/12/...gle-adobe/amp/
Quote:
SAN JOSE — In a record-setting splurge of spending, developers, investors and tech companies have gobbled up properties in downtown San Jose, paying out more than $3 billion in three years.
The land rush extends far beyond Google’s head-spinning shopping spree near the bustling SAP Center and aging Diridon train station. If Google dominated the first two years of the buying binge, the last year has marked the arrival of stalwart developer Jay Paul Co., which is eyeing two major projects to create new tech campuses that would reshape the San Jose skyline and fuel downtown activity.
“Google’s planning for a major South Bay campus in the Diridon Station area has triggered a virtual gold rush for downtown real estate,” said David Buchholz, a senior vice president with Colliers International, a commercial real estate firm.
But experts offer one caveat: All that buying needs to be followed with construction.
...
Class A office rents — rents for modern office buildings — in downtown San Jose averaged $4.74 a square foot in the first quarter of 2019, up 14.5 percent from the same period in 2018, Newmark Knight Frank determined.
Rental rates in downtown San Jose are rising slightly more quickly than in downtown Oakland. However, San Francisco’s office rental rates have galloped ahead of those in the downtown districts of San Jose and Oakland. During the first quarter of 2019, San Francisco’s monthly office rents were $7.26 per square foot, up 19 percent from the year before, according to Collier International research. Downtown Oakland office rents were at $5 per square foot a month, up 14.2 percent from one year earlier, Colliers reported.
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To be honest I think a lot of this includes speculation about the effect of having BART stations open there in 10-20 years. But there has been a significant increase in rents recently, about 5 years ago rents were about $3/sqft/mo for class A space, now it is about $5/sqft/mo. Jay Paul and a few other players have been heavily investing, and it is a welcome move IMO, as the big office parks they were building in Sunnyvale have worsened traffic, and increased car dependence in the valley. Having office parks near transit, like these office buildings by Jay Paul, and when it gets built Google, will have a positive impact.
Though I don't think that office complex that Google is leasing in Brokaw and Bering ^^^ will lead to that. But I can't blame them, they got a lot of protests from trying to move to downtown, while, the office parks in North San Jose, Sunnyvale, Santa Clara, Cupertino etc are never protested.