February 3, 2017
By Daniella Soloway
Connect Silicon Valley drew CRE owners, investors, developers, lenders, brokers, architects and more to the Capital Club in San Jose for an afternoon filled with informative panels and extensive networking. From discussions about how to develop affordable housing in the valley, generational shifts and impacts on multifamily and mixed-use and the future of retail, to the politics behind tax reform, 1031 exchanges and what the Valley will look like in 50 years, a lot of ground was covered by the 16 speakers.
Some of the key takeaways from each of the panels include:
Multifamily: The Housing Crisis, Rent Control, & Market Trends
Industry experts shared the stage to talk about affordable housing, what’s attracting people to San Jose, the market’s supply/demand equation, and how to reach efficiencies in the multifamily development process.
- Anton Development’s Andrew Baker shared that tax credits are trending downwards because of the new political administration. With this move, it’s harder to develop affordable housing, and with shifting variables, land prices are plateauing.
- Simeon Commercial Properties’ Mike Kim said, “Downtown San Jose is poised to be something significant, it just needs more of everything- multifamily, retail…everything.” He also noted tha,t with the uncertainty facing imports and exports, and exports a “main driver of the Silicon Valley economy,” it’s hard to know what the future will look like. He said with such “uncontrollables,” the short term will require patience, but he’s optimistic about the long term as things start picking up from what he dubbed a “nap.”
- MVE’s Principal Darin Schoolmeester shared that the trends driving the demands of amenities are site-specific, but mostly include lifestyle and community. He mentioned that millennials are really pushing for perks for their pets, such as dog parks and pet spas.
Silicon Valley: A Look at the Next 50 years
The private and public sector came together to share their predictions, and how what they’re doing today that will affect the region for decades to come.
- On the topic of how the Valley is building itself and job growth, Kilroy Realty’s Brandon Wang said large corporate locations, such as Apple’s $5 billion campus, is “really about making a statement that reflects [the company’s] culture.” He also noted that the number-one priority, after attracting and retaining talent, is security.
- Regarding transit-oriented developments, companies including Amazon, even with their industrial properties, highly value being close to transit because they don’t want their employees having to drive to work, per Prologis’ Jeff Major.
- Aedis Architects’ Thang Do discussed urbanization trends, and believes that due to the “geography of Silicon Valley, it means that there won’t be a single downtown. San Jose will be the main one, but other downtown communities will exist as urban villages.”
- As self-driving cars become a reality, SPUR’s Teresa Alvarado shared that “efficiency in transit and mobility will change our patterns forever. In the interim, it’ll be a difficult transition, but ridesharing has already helped us think of alternatives.”
The Evolution of Retail and Mixed-Use
The panel took the stage for a fiery discussion on whether traditional malls are dead, how commodities are being purchased differently than in the past, the way generations are shaping current retail trends, and more.
- Cushman & Wakefield’s James Chung said experience points out that “they come and find you.” Having said that, he also explained that businesses should research their target markets before signing a lease, rather than assuming consumers will want to find their favorite stores.
- Pacific Retail Partners’ Najla Kayyem said “services beat goods, and convenience is an experience.” She doesn’t think malls are dead, but rather, retailers need to take care of their four walls because people still “want a sense of community and the congregation of retail and specialty, plus restaurants, isn’t going away… it’s evolving.”
- On the topic of millennials moving back to the suburbs, Insight Realty Co.’s Dennis Randall shared that the generation still seeks something “urban-esque,” and is driven by ethics and lifestyle, focusing on aspects like public transportation, living green, etc.
For comments, questions or concerns, please contact Daniella Soloway