Major Silicon Valley developments to watch in 2024

In 2023, San Jose and Silicon Valley’s development scene faced numerous challenges, including increasing costs due to inflation and spiked interest rates making financing projects of all kinds more difficult and expensive.

While development approvals continued at a rapid pace, many projects are on hold or being changed or resized to cut costs, office space is becoming emptier and it’s unclear whether next year will bring a different landscape for builders and investors.

Here are some of the major developments to keep an eye on in 2024:

Housing in San Jose

San Jose has submitted a revised housing element to state officials—a plan to show how the city will accommodate 62,000 new homes in the coming eight years. The city is hoping for approval roughly a year after the deadline to submit the plan.

In the absence of a certification of its plan from the state, however, developers are taking advantage of what’s known as the “builder’s remedy” in state housing law. The provision allows builders to submit housing project proposals of any size and shape, and in most cases the city would be forced to approve them. However, city officials have said their plan is compliant enough already to dismiss such proposals.

Some proposals are bigger than local neighbors want to see, or would be replacing longstanding community spaces, such as the San Jose Swim and Racquet Club. But the remedy provision has also been used this year to claw back the size of previously larger projects, proposing to cut away critically needed homes against city officials’ wishes, like at the Berryessa Flea Market site.

Reshaping Vallco property

Palo Alto-based Sand Hill Property Company said high interest rates, rising costs and project delays have forced a cutback and redesign of major elements for The Rise, its large and controversial development of offices, housing, retail, dining and park spaces on the site of the former Vallco Mall in Cupertino.

If all goes smoothly with a city review of a recent project modification request, development could begin in 2024 on the vacant 50-acre site at the corner of Wolfe Road and Stevens Creek Boulevard where Vallco used to sit. Most of that would be “horizontal” site preparation work. The first buildings could begin going vertical in 2025.

Google moving ahead, Google on pause

Google is in the latter phases of building two five-story office buildings along Caribbean Drive in Sunnyvale’s Moffett Park area, totaling just over 1 million square feet, which, after some delays, are estimated for completion by August 2024.

Sunnyvale has also completed a major update to its plans for Moffett Park, envisioning up to 20,000 new homes and 10 million more square feet of office space in the coming 20 years, and Google is likely to pursue mixed-use projects in the area.

Meanwhile, Google’s massive Downtown West office and housing project plans, which have been on hold, hit another snag, as the company announced it would part ways with an Australian development firm it had partnered with for multiple Bay Area office projects.

Church of Christ Scientist exposed

Some residents have raised concerns about how the historic and neglected Church of Christ Scientist building in downtown San Jose will fare now that tattered tarps shielding some of the structure have been removed by a local contractor.

The building is still owned by Z&L Properties, whose co-founder Zhang Li was arrested last year in London in connection with a bribery scheme out of San Francisco. Z&L has been selling off other properties since. While San Jose officials have fined Li and mulled harsher penalties for owners of blighted properties, they have not taken further action to save the building.

Tenants organizing

Residents of multiple income-restricted apartment complexes in San Jose and the South Bay took collective action in 2023 to demand cleaner and safer living conditions, fair rents, broader language access and better security, among a host of other issues.

Some residents, like those of buildings owned by KDF Communities, have formed tenant associations, using union organizing tactics to push for improvements from their landlords. Some councilmembers have expressed solidarity with the groups and have appeared at protests.

Sobrato site to host 75 cabins for unhoused people

San Jose officials have approved plans to lease two acres of land for five years for $1 per year from developer and philanthropist John Sobrato to use for 75 two-bed cabins as temporary homes for 150 unhoused people. The project will be located at the southeast corner of Via del Oro and San Ignacio Avenue and is expected to be completed by mid-2024.

Housing on VTA sites moves forward

VTA, which runs buses and light rail around Silicon Valley, is moving ahead with building housing projects on its properties. With 11 sites planned for development, the transit agency is aiming to create much needed housing in the region while hoping to steadily increase ridership and revenue.

Construction was set to begin in the summer on a 134-apartment affordable housing project at Tamien Station in San Jose, as part of a total 560-apartment development by The Core Companies. The agency was also slated to start work on an affordable 195-apartment complex on an empty lot next to the Berryessa Transit Center in San Jose with developer Affirmed Housing Group. The transit agency has about 1,600 apartments or homes in the pipeline across several projects.

Antique Row to be leveled in Burbank neighborhood

Real estate investment group Oak Glen Ventures’ is planning to build a 227,617-square-foot mixed-use building that will include a 246-bed residential senior care facility known as San Carlos Commons in San Jose’s Burbank neighborhood. Plans also include housing, with 61 apartments and 6,000 square feet of ground floor retail space at 1881 W. San Carlos St. and surrounding areas.

The development will require the demolition of four commercial buildings that house several antique shops and other businesses. Two of the buildings are eligible to be city landmarks. The timeline for the project is unclear.

Sunnyvale housing envisioned near Caltrain tracks

Sunnyvale officials approved a project proposal to develop two, seven-story buildings with 280 apartments and more than 200,000 square feet of office space right next to Caltrain’s Lawrence Station, at 1154 and 1170 Sonora Court. San Francisco-based developer SKS Partners also plans to include a public pedestrian access point to the northbound platform of the Caltrain station.

Contact Joseph Geha at [email protected] or @josephgeha16 on X, formerly known as Twitter.