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June 12, 2015

Cushman & Wakefield's new offices to join the growing brokerage hot spot

Silicon Valley Business Journal

Nathan Donato-Weinstein

Expect to see even more brokers in downtown San Jose after Cushman & Wakefield signed a lease to move its local office to 10 Almaden, one of the city's trophy towers.

"We're a big believer in downtown San Jose,"Jeff Cushman, executive managing director and managing broker for C&W in San Jose, told me. "If you look at what's happening with rents, the appreciation is unbelievable. With more residential development, will come more people and more retail. That will bring more energy throughout the day and evening."

The 14,000-square-foot lease on the fourth story of the tower means Cushman will be one floor below colleagues at brokerage Kidder Mathews. CBRE is across the street at 225 W. Santa Clara St. (and is itself on the move within the building - more on that some other time). Colliers International is a half-mile down West Santa Clara Street at 450 West Santa Clara. Meacham Oppenheimer CORFAC International, Ritchie Commercial and Eastdil Secured round out the neighborhood real estate ecosystem. (Email me if I missed anyone.)

"The more the merrier, from my perspective," Reed Payne, executive vice president atKidder Mathews, told me.

Payne noted that downtown San Jose seems to be looming large in the brokerage world, with the past few presidents of the Association of Silicon Valley Brokers coming from downtown.

It's still TBD whether more brokers downtown will translate into more commercial deals in the central business district; office-vacancy rates in the better, Class A buildings have been tightening, though there is still more vacancy in the submarket than, say, Sunnyvale.

Cushman is moving its 50-plus brokers and staff members from its longtime home near Santana Row on Winchester Boulevard. That location, of course, is just a hop and a skip from the Santana Row node of DTZ - the brokerage powerhouse that is buying Cushman in a deal expected to close later this year. The downtown San Jose lease negotiations started before the merger got going, and Cushman declined to discuss anything related to the acquisition or integration for now. Terms of the new lease were not disclosed.

But Cushman did say that the new space will be more open, progressive and "cutting edge" in its design. "We're very excited about it. We've had everyone over to take a look.

"The whole space is open, but it will have much more in the way of conference rooms and collaboration space," he added.

Cushman's new home is owned by KBS REIT III, which bought the building in late 2014 from Equity Office for $116.7 million. DTZ reps the landlord; Cushman was repped by Jeff Cushman, Jim McPhee and Michael McMillan.

"It's definitely not easier, because everyone's an expert," Cushman joked about the somewhat meta task of a real estate services firm negotiating its own lease.

Kidder Mathews' Payne agreed: "As brokers, we become tenants as well, and have to deal with our own space issues."

For the full story, go to Silicon Valley Business Journal.

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