After more than a decade of planning and delays, a 15-story, 100% affordable apartment building known as The Gateway Tower is set to break ground in downtown San Jose’s SoFA District early next year.
The breakthrough comes after developer The Core Companies announced it had secured all necessary funding to move forward with the $197-million construction plan. That includes a $38 million loan from San Jose approved by the City Council in late September.
The Core Companies intends to develop the wedge-shaped half-acre site — bounded by First, South Market and East William streets — into a glass-walled building housing 220 apartments for low-income residents. It will also include more than 3,000 square feet of ground floor retail space.
The company projects construction will take roughly two years.
District 3 Councilmember Anthony Tordillos, a backer of the Gateway Tower plan, said he expects the development to provide a boon for the downtown neighborhoods he represents.
“It’s the only 100% affordable housing high-rise in the city,” Tordillos told San José Spotlight. “So (I’m) very excited to see this purpose-built affordable housing coming to the heart of the SoFA district.”
The project has secured a mix of funding from public and private sources. That includes a $64 million loan from Santa Clara County, according to The Core Companies. San Jose’s $38 million loan accounts for 34% of the total public subsidies for the project, according to a city presentation.
The development is a significantly scaled down version of an earlier proposal. That plan, approved by San Jose in 2016, called for a 25-story mixed-income building that would have included 300 apartments and 2,000 more square feet of retail space.
The Core Companies said the current proposal’s 220 affordable apartments will be targeted for working professionals making 30% to 70% of the region’s median income. In San Jose, that’s an annual income range of roughly $42,200 to $98,500.
Fifty-five apartments will be set aside for local “rapid rehousing” programs that provide homes for people facing homelessness, company representatives said.
“Gateway Tower will not only fill an urgent need for housing, but it will also contribute to the revitalization of San Jose’s downtown area, representing Core’s mission to deliver high-quality, beautiful homes that strengthen the local community,” The Core Companies President Chris Neale said in a news release.
The developer has also agreed to set aside about 10 apartments for local SoFA-based artists at the urging of elected leaders, including Tordillos, Mayor Matt Mahan and District 4 Councilmember David Cohen.
Tordillos said this is necessary to ensure the culturally rich neighborhood remains a hospitable place for the many working artists who call it home.
“Local arts and culture in San Jose drives close to $300 million of economic activity every year,” he said. “But obviously all of that is dependent on us actually having artists who can afford to stay and work in San Jose.”
Three existing buildings between 493 South First St. and 480 South Market St. will be at least partially demolished to make way for the new development. That includes Herrold College, a city landmark connected to the early history of radio broadcasting.
In a nod to the historic significance of the structure, the project calls for preserving the college’s historic facade and the creation of a historic display area to commemorate Charles “Doc” Herrold, the early radio pioneer who gave the building its name.
Contact Keith Menconi at [email protected] or @KeithMenconi on X.
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