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June 19, 2017

Google's San Jose renewal plan: 'Grand Central of the West'

Mercury News

George Avalos

SAN JOSE - Google's plan to build a massive transit-centered village in downtown San Jose could provide a new model for the design of sprawling tech campuses by addressing one of the Bay Area's biggest headaches: commuters sitting in seemingly endless traffic jams.

The Mountain View search giant's development would reshape downtown San Jose in a dramatic fashion, similar to the major renewal of San Francisco's Mission Bay. It would take advantage of the groundwork San Jose and Silicon Valley leaders have done to bring more transit links into Diridon Station. And the project would elevate San Jose's position among tech's biggest host cities, bringing 15,000 to 20,000 Google employees into the city, which is already home to large tech employers such as Cisco Systems, Adobe Systems and eBay.

"This project really exemplifies the rethinking of the corporate campus," said Teresa Alvarado, director of the San Jose office of SPUR, a planning and urban research nonprofit group. "We are moving away from the sprawling, car-centric campus where people stay inside all day. Google would create a campus integrated with the community."

Google is already working to secure real estate near downtown San Jose's transit hub, Diridon Station. The plan it's discussing with San Jose city officials would redraw the map of some 240 acres, building 6 million to 8 million square feet of tech offices and research-and-development space, along with room for retailers.

On Tuesday, the San Jose City Council is scheduled to decide whether to open negotiations with Google to sell 16 city- and local agency-owned properties to the Mountain View search giant.

"This is critically important for downtown San Jose," Mayor Sam Liccardo said. "But far more than people realize, this is critically important for the future of Silicon Valley."

Echoes of Mission Bay

The potential renovation of downtown's Diridon Station area evokes parallels to San Francisco's Mission Bay, which until an official groundbreaking in 2000 was a 303-acre windswept shoreline dominated by old rail yards, ship piers, warehouses, industrial buildings, marshes and waterfowl.

"Now it's an unbelievable metropolis," said Mark Ritchie, president of San Jose-based Ritchie Commercial, a realty firm. "Google can become to downtown San Jose what UCSF has become to Mission Bay. This will be bigger than anything that has happened in downtown San Jose."

Some 17 years after construction began in Mission Bay, about 5,000 of a planned 6,400 residential units have been constructed. Mission Bay is home to a UC San Francisco medical center, Kaiser Permanente, Lyft, Cisco Systems and Nektar Therapeutics. On the horizon: Chase Center, whose highest-profile tenant will be the world champion Golden State Warriors. Plus, Uber Technologies will move its headquarters to the development.

The concept of a Google transit village in downtown San Jose comes at a time when tech companies continue to face fierce competition to attract and retain employees. They are under pressure to do more than dangle plump paychecks and stock options in front of recruits.

"Young, creative people who are driving innovation in our leading companies are choosing where they want to live before they decide whom they want to work for," Liccardo said. "They want to live in dynamic urban environments."

Pairing tech with transit

Google's development would be situated at the heart of San Jose's grand plan to make Diridon Station a central hub of stops for every major rail service in the region: BART, Amtrak, Caltrain, the ACE Train and planned high-speed rail.

"The fact that it is a transit hub is very important to Google, and the size of the potential development is attractive," a Google representative said.

The city has estimated that its plans to bring all those transit links to Diridon will increase transit trips to downtown San Jose eightfold.

"The only reason Google is coming into the downtown is that transit hub," said Carl Guardino, president of Silicon Valley Leadership Group. "Diridon Station is absolutely going to be the Grand Central Station of the West. We will see 600 trains a day going through there."

Rod Diridon, a former Santa Clara County supervisor and longtime transit advocate for whom the station is named, has said in the past that he sees mixed-use development connected to train stations as essential to preventing Silicon Valley's traffic nightmares from growing even worse.

"No amount of freeway improvements will allow Silicon Valley to build its way out of the traffic congestion we will now have forever," Diridon said this month. "What we are seeing is a microcosm of the evolution of the United States to new kinds of transportation systems."

Affiliates of Google and its development partner, Trammell Crow, have already bought properties near Diridon Station and the SAP Center sports and entertainment complex, home to the San Jose Sharks hockey team.

Wow factor

Google's vision for a downtown village could spur new interest in San Jose's somewhat overlooked central core. The city has said Google's tech-campus design would provide open spaces for public recreation, along with entertainment and retail options. That could make downtown San Jose a more memorable destination.

A March 2016 study suggested San Jose is a fairly forgettable city in the national consciousness, despite the presence of the NHL's Sharks. That's something San Jose's leaders certainly want to change.

"For a long time, San Jose has considered itself the capital of Silicon Valley, but this really roots us in a way that the center of gravity for Silicon Valley will shift southward," SPUR's Alvarado said.

Bringing Google into downtown could also help the city's downtown attract more investment.

"We will see more players that want to invest in real estate and redevelopment downtown," said Chad Leiker, a first vice president with commercial real estate firm Kidder Mathews.

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