SummerHill Homes, Cypress Equity Plan Rentals in San Jose

SummerHill Homes and Cypress Equity Investments are planning to replace a vacant office building in San Jose with affordable apartments and market-rate houses.

The California-based real estate firms are in contract to buy a 5.9-acre site at 3550 North First Street, which encompasses the empty office building, a surface parking lot and some vacant land, the Mercury News reported. The developers plan to add 446 homes to the parcel.

LBA Realty is the seller. The proposed price hasn’t been revealed.

Plans call for 373 affordable apartments for rent and 73 townhouse-style condominiums that would be sold at market rate, SummerHill senior vice president of development Kevin Ebrahimi told the outlet.

The 100 percent affordable apartment component will have an affordability target of 60 percent of the area median income. The Santa Clara County area median income is $143,850 for one person or $205,500 for a household of four, with 60 percent working out to roughly $86,310 for an individual renter or $123,300 for a four-person home.

An LBA affiliate acquired the site in February 2025 for $18.5 million, spending 42.9 percent less than the site’s assessed value of $32.4 million the month prior.

An influx of tech and artificial intelligence companies and their workers is exerting pressure on the local multifamily and single-family markets.

In San Francisco, this has led to a mansion shortage at the higher end of the market, while multifamily developers in San Jose and across Silicon Valley are looking to meet the growing demand for housing as more workers move in.

Earlier this month, an investor group in San Jose proposed an eight-story building at 945 West Julian Street with 136 units on a half-acre site. Last month, Green Valley Corporation and Pacific Housing acquired a piece of land at 1655 Berryessa Road in San Jose for roughly $15 million with plans to erect a 260-unit affordable project known as Berryessa Family Apartments.

— Chris Malone Méndez