Tuesday, September 12, 2023

Downtown San Jose expected to escape "doom loop"

An article at SiliconValley.com has been circulating over the past week with an optimistic outlook on Downtown San Jose's future. The title says it all: "Downtown San Jose is poised to escape ‘doom loop’ scenario: experts."

These experts are a panel of industry leaders, executives, and developers. The primary struggles are access to capital markets which are mostly frozen or too expensive due to interest rates. They predicted it would take until 2025 for major recovery and apartment and office projects to get off the ground.

Several people from the panel urged business leaders to make Downtown San Jose a vibrant entertainment district in 2024, which would help set the stage for major development in 2025. 

In order to make that happen, San Jose has to confront homelessness, blight, and crime. These issues also exist in San Francisco, but to a much larger extent. One panelist said:

"There is a once-in-a-generation opportunity for San Jose to eat San Francisco's lunch. San Jose is a more friendly place for conventions, it is a better place to hear music, it is a better place to have dinner."

In addition to bring more of these recreational opportunities down south, there is still significant demand for office space for AI startups. Normally these small companies would look first in SF, but the panelists said they are seeing more and more inquiries for space in the South Bay.

Mayor Matt Mahan and other panelists rattled off a list of reasons why Downtown San Jose is destined to become Silicon Valley's urban core. These included access to transit, entertainment, SJSU, great weather, a large population base, and existing nearby companies like Google, Adobe, and Apple as anchors.

One last quote from panelist Gary Dillabough worth mentioning is:

"We have to be bold. We need to start thinking differently in San Jose. We need a different attitude. We can’t overthink things. We need to take chances.”

In other words we have to do the same things as a city that our local tech companies have to do in order to survive and thrive. 

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