Three Reasons Now Is The Time For High-Rises in San Jose
We checked in with BSB president Case Swenson, who's building a pioneer apartment project in the heart of San Jose, about why now is the time to get out your shovels.
1. Demand Is High But Not Enough Permit Approvals
Silicon Valley got 40,000 new jobs last year--but only 8,000 permits for new housing units, says Case (here on a stroll with the hat-loving chairman Barry Swenson). The firm's 396-unit Centerra project accounts for 5% of the total allocations on two acres of land. When it comes to California--and especially San Jose--everything is based on sprawl. Europe does it right, he says, where train stops are surrounded by a metropolis five-to-20 stories high--then it's back to rural until the next urban train stop. That method will not only solve the housing issue but will save the land and further sprawl.
2. Parking Lots Are the New Foundations
His firm is convincing big tech firms to hand over their air rights atop parking lots. If the firm owns a parking lot, for example, all BSB would have to do is put their parking lot out of service for three to four months. They then could go up 20 floors to provide campus housing, more amenity space or more office space for these campuses without having to use more land or affect wildlife. It's starting to make more sense to these high-tech companies to build right at their HQ instead of driving across town. He's mum on which companies he's in talks with, but expect some partnerships in the future.
3. Meet Centerra
Centerra is a concrete superstructure BSB designed, modified, then redesigned. His firm's been trying to do high-rise housing in San Jose for years--and finally the numbers became finance-able due to the fact it's such a great location. The double digit rental rate increases over the past two years have also helped, now approaching $3.50/SF. The biggest perk at the property is the fact the pool and adjacent workout room have afternoon sun--a feature unmatched in San Jose. That's really important to him, to be able to get tenants outside. Western views are spectacular and unobstructed, he says. Renting starts next fall.
Case plays guitar in a band and performs four times a year; his next gig is in Maui for the holidays (expect covers from the Rolling Stones, Black Crows and Dave Matthews Band). Apartment towers are catching on all over town--Essex's 23-story One South Market downtown, for example. BSB has another 400-unit apartment project in North San Jose near the airport. And it hopes to get the 230-unit Park View off the ground at Saint James Park in the second half of 2015.
