Campbell-based Bay West Development has received approval from the San Jose Planning Commission to move forward with the development of almost 2 million square feet of office space.
The proposal is for the construction of seven new eight-story buildings at 550 East Brokaw Road with a total of more than 1.9 million square feet. The project also involves two parking structures totaling 5,385 vehicle stalls, all on a 19.7-acre site, according to plans filed to the city. The two parking structures will total 1.6 million square feet.
Plans call for the demolition of 274 trees, an existing parking structure and a commercial building, formerly home to Fry’s Electronics, that is 213,626 square feet. Amenities at the development would include two large open spaces, paved office patios, miniature plazas and outdoor work and meeting pods.
During a meeting, the Planning Commission highlighted that employment opportunities in the city have not matched the rate of housing development.
“The North San Jose plan has been a vision for the city to have housing and jobs,” Pierluigi Oliverio, planning commission chair, said. “The city, in its phase one, built all the housing and didn’t receive the jobs that were intended. So this project would put it a step in that direction to provide the jobs, which then in turn provides the tax base both to cities, counties and school districts to pay for city services and local government services.”
Bay West Development has built projects in California, Texas and Washington, according to its website. It’s currently developing a 590 unit apartment project called Bascom Station in San Jose.
The Silicon Valley office market slowed in the fourth quarter of last year compared to the pre-pandemic levels it saw earlier in the year, according to a report by CBRE. The vacancy rate rose to 14.3 percent compared to 13.6 percent in the third quarter. The average lease rate stayed the same at $5.65 per square foot. Also, there was less office space under construction at 4.9 million square feet last quarter compared to 5.2 million in the third quarter.
“The current state of the economy impacted headcount decisions, and layoffs continued,” the report said. “ Additionally, many companies continued to evaluate their current footprints and held off on expanding. It is expected they will defer real estate decisions as economic uncertainty continues into 2023.”
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