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August 21, 2015

New office complex planned for north San Jose

San Jose Mercury News

George Avalos

SAN JOSE -- A new office campus of 1.1 million square feet is being planned for north San Jose on Zanker Road, and the site is big enough that it could land major tech tenants such as Apple and Broadcom.

Boston Properties has submitted plans to San Jose city officials to construct two big office buildings on the site that would total 537,000 square feet, according to city records.

In addition, the site contains four existing buildings that total 570,000 square feet. Three of the four buildings would be renovated by Boston Properties to transform them into Class A prime office buildings that would be attractive to tech companies.

"We have a potential tenant for the entire site. It's a very large tenant," said Mirjam Link, project manager for Boston Properties. "They would take the four existing buildings and have a phased move into the two new buildings we would construct."

Link wouldn't identify the tenant but said Boston is in lease negotiations with the tenant.

Apple is believed to be the likely tenant for the site. However, Broadcom occupies offices adjacent to the property and may be eyeing a consolidation site for existing operations in San Jose and Sunnyvale.

The property is located at 3100 Zanker Road in north San Jose and is bounded by Zanker, Montague Expressway, Research Place and Innovation Drive.

"Silicon Valley is still a hot office market, and north San Jose is also hot right now," said David Vanoncini, a senior vice president and partner with Kidder Mathews, a commercial realty firm.

Recently, Apple paid $138.2 million in cash for a large parcel of empty land near North First Street and Component Drive. The land is adjacent to a site where the tech titan leased 290,000 square feet from Ellis Partners. Those deals could enable Apple to create a campus for 15,000 workers.

Neither Cupertino-based Apple nor Irvine-based Broadcom responded immediately to requests for a common about the Boston Properties site.

Besides Apple and Broadcom, Salesforce and Qualcomm also have been looking at sites in Silicon Valley, and Google is in expansion mode as well.

"The tenants that have been expanding are very strong, creditworthy companies," Vanoncini said. "They are taking down big blocks of space."

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