Core Companies eyes affordable housing highrise in San Jose

Core Companies wants to build a 15-story affordable housing highrise in Downtown San Jose.

The locally based developer led by David Neale has filed plans to build the 220-unit complex at 470 South Market Street, in the SoFA District, the San Jose Mercury News reported. It would replace some mostly empty buildings which house the headquarters for Core.

The project known as Gateway Tower would also partially bulldoze Herrold College, a city landmark named after Charles “Doc” Herrold, a radio pioneer who in 1912 conducted what is believed to be the first entertainment broadcast from his station in San Jose.

Plans call for a chunky glass tower with 220 affordable apartments above 3,800 square feet of ground-floor shops, a half-block from the San Jose McEnery Convention Center next to the  “South First Area,” or SoFA, a trendy district known for its murals, theaters and restaurants.

The tower, designed by San Francisco-based Kwan Henmi Architecture & Planning, would feature a series of blocks with floor-to-ceiling windows on a flat-iron shaped lot. The complex would include one- and two-bedroom units, a gym, community room, garden and on-site resident services.

Apartments will be available to people who earn between 30 percent and 120 percent of the area’s median income, which is $151,300 for a family of four.

A street-level exhibit on South First Street would be dedicated to the radio pioneer and the birth of broadcasting in San Jose.

The narrow southern side of the project site appears to include room for a plaza and a small area for performances with seating, according to the proposal.

Core Companies’ initial plan for its Gateway Tower was a 20-story highrise with 300 market-rate, luxury apartments. But a shorter tower with affordable units might have a smoother path to landing a construction loan and permanent financing, real estate experts say, during a period of higher interest rates.

In early 2022, an affiliate of Core bought three parcels for its proposed tower for $18.2 million. 

The firm also landed $18.2 million in financing from Santa Clara County to buy the land. The county will provide another $64 million in construction money from the Measure A Affordable Housing Bond approved by voters in 2016.

An estimated cost and construction timeline of the proposed tower were undisclosed.

“This is a great-looking project with smart urban design interfacing with the public realm,” said Bob Staedler, principal executive with Silicon Valley Synergy, a land-use consultancy. “Place-making and urban vibrancy need to become the norm in Downtown San Jose.” 

The Core Companies, founded by Neale in 1989, has developed more than 400 single-family homes, townhomes and condominiums, plus 2,300 apartments in the South Bay, according to its website. In the past decade, the firm has developed 17 properties at a cost of $500 million.

A year ago this month, the Core Companies and Republic Urban Properties landed $139 million in public financing to build 135 affordable apartments at 1197 Lick Avenue in Downtown San Jose. They represent the first phase of a 569-unit complex planned next to Tamien Station, with the second phase consisting of market-rate units.

The company also is moving ahead with Agrihood, an affordable development of 361 homes in Santa Clara, with a 1.5-acre urban farm. Of those, 181 homes will be offered at below-market rates, with 165 set aside for seniors. 

— Dana Bartholomew

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