SAN JOSE — Widening woes in the tech sector such as job cuts have hobbled efforts to land a big tenant for a brand-new San Jose office building next to Santana Row, real estate executives said Thursday.
Despite the current short-term lease challenges for the One Santana West complex, the long-term prospects remain bright for the big new office building, executives with Federal Realty Investment Trust, the principal owner and developer of Santana Row and the adjacent office project, told Wall Street analysts Thursday.
Problems on multiple fronts for the tech sector have coalesced to impede demand for One Santana West, which has sprouted across the street from Santana Row, Donald Wood, chief executive officer for Federal Realty, said during the conference call.
“There is no question that the cooling of the technology sector in the last 90 days both in terms of their stock prices and getting employees back into the office has been a wet blanket on what had been strong leasing momentum” for Santana West, Wood told analysts.
The office building totals 375,000 square feet and is located on Winchester Boulevard.
“This has been disappointing, yes,” Wood said of the lack of completed deals for Santana West.
Still, the developer and its leasing agents for the project, a term of brokers from Newmark, a commercial real estate firm, are pulling out the stops to get the project filled up, Jeff Berkes, chief operating officer with Federal Realty, told the analysts.
“We are not taking a pause on leasing” Santana West, Berkes said. “We are out there working as hard as we can to lease the building as quickly as we can.”
Despite the short-term difficulties, the future is bright for the eye-catching office building, Federal Realty officials insisted.
“To put this in perspective,” Wood said during the call, One Santana West is “a brand-new, state-of-the-art office building next to one of the most successful, amenity-rich destinations in the tech capital of the country.”
Source:: The Mercury News – Entertainment