Baltimore-born venture capitalist Gary Dillabough wasn’t always involved in development—like many people in Silicon Valley, he worked in the tech industry.
“I was getting ready to leave (eBay) around six or seven years ago and my boss said, ‘Hey, listen. I know you care about the environment, I know you care about construction and real estate. We need to put together a corporate social responsibility program for the company,'” Dillabough said.
Although he eventually left eBay, he took those passions to another job at real estate firm Cornish & Carey. There, he met his longtime business partner, like-minded Jeff Arrillaga, and settled on an “intriguing” city to develop—San Jose.
“We put together a little fund and bought our first five projects,” Dillabough said. “Now we’re up to about 34.”
Dillabough and Arrillaga’s office at Fountain Alley overlooks one of their signature projects—a revitalization of the Bank of Italy building.
The Bank of Italy project is part of a new plan to make downtown San Jose a regional destination with vibrant urban spaces full of food, drinks, comedy and music.
A community-wide approach
As a youth, Dillabough moved around the country to places such as Hawaii and San Bruno while his father worked on projects as a civil engineer. Dillabough earned a degree in civil engineering from Cal Poly, San Luis Obispo. He and Arrillaga later founded Urban Community, a real estate firm of their own focused on buildings in downtown San Jose.
Dillabough invested in projects like the hanging gardens set to grace the facade of the 96-year-old Bank of Italy building downtown. By 2019 he snatched up 21 properties through Urban Community for more than $300 million. That’s as much as Google’s Downtown West project.
Dillabough and Arrillaga are also co-founders of the Urban Vibrancy Institute along with Tony Arreola and Mark Lazzarini. The institute collaborates with local organizations such as the Silicon Valley Organization, SPUR and San Jose Downtown Association for programs including food and art exhibits.
“Our hope is that Urban Vibrancy provides that platform to really bring everyone together to focus on a few initiatives and see if we can move the ball forward,” Dillabough said.
Derrick Seaver, CEO of the Silicon Valley Organization, said Dillabough is taking a community-wide approach to what he’s doing in San Jose.
“Instead of focusing on one individual project, he talks about activating the downtown area, getting things on the street and looking at projects holistically,” Seaver said. “Looking at how things work together and complement one another to really build downtown.”
This Friday, Urban Vibrancy will launch Every Friday, a weekly art, music, comedy, food and small business exhibit at Fountain Alley similar to a monthly arts and culture exhibit in the SoFA District called First Fridays.
The two men set their sights on San Jose because of its many assets and opportunities.
“It’s not hilly, it’s next to San Jose State, you have the airport, you have the Sharks,” Arrillaga said about downtown. “You have so much infrastructure in place, and I love the historical buildings too. You have an intermixing of historical buildings and new development. It’s almost an open campus to create something—much easier than a lot of other cities.”
And that approach is critical as the city continues to ramp up development downtown through efforts such as opportunity zones, parks, high rises and other new construction as the region begins to recover from the pandemic and business picks up.
“The Urban Vibrancy Institute is looking to build off of things that are already existing and working in the city, and collaborating with others to make progress, specifically looking at a clean, safe and vibrant community,” said Eric Glader, executive director of Urban Vibrancy.
‘In love with San Jose’
Dillabough’s projects are part of his approach to urban development: a lively downtown area featuring walkable spaces, green areas, energy-efficient buildings, modern architecture and spaces for arts and local artists.
The founders of Urban Vibrancy say the region has the perfect mix of tools to put together projects: tech companies, clean and walkable downtown streets, a budding arts scene, small businesses and the political will to promote development.
“I’ve talked to some of these capital partners and asked them if they can tell me a city that has better assets lined up like this, and kind of all ready to go,” Dillabough said. “When you outline it like that, there’s no other city in the country that we think has the type of asset base that San Jose has.”
Dillabough’s approach to developing the nation’s 10th largest city has garnered respect from Silicon Valley insiders and business leaders.
“He’s not just a guy who’s trying to build units. He’s actually thinking more broadly,” said Russell Hancock, CEO of Joint Venture Silicon Valley, an economic think tank. Dillabough sits on Hancock’s board of directors. “The venture capital mindset, the passion and commitment to sustainability and wanting to make places vital. That’s to me what makes Gary Dillabough so interesting and important.”
And Dillabough is doing it all in San Jose.
“Most people, if they’re planners and dreamers, they’re going to Singapore or Hong Kong. Or if they’re going to the Bay Area, they’re going to San Francisco. They view that as their palette,” Hancock said. “Gary is in love with San Jose.”
During the next handful of years as the Bank of Italy building undergoes renovations, Urban Community’s buildings finish construction and Urban Vibrancy launches more arts projects, Dillabough believes the most important elements to downtown are those that activate the space: the people themselves.
“I really believe part of the ‘secret sauce’ here is the people,” Dillabough said. “What I’ve found is that the people who work and live here really care about this city. They have a tremendous kinship to it. They really want to see it succeed. I think that’s different from other cities.”