SAN JOSE — New dining spots, shops, a lively plaza and a modern data center may emerge at a key downtown San Jose building under a wide-ranging plan being floated at City Hall.
Hines Interests, one of the world’s largest real estate firms, has proposed a plan to fill a string of empty retail spaces on the ground floor of 150 South First St., a building that totals 179,800 square feet.
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The building’s empty merchant spaces primarily front on South First Street, Paseo de San Antonio and South Second Street.
“We are proposing a significant community investment and benefit to renovate and rejuvenate all of the ground floor retail spaces,” said Erik Schoennauer, a San Jose-based land-use consultant for Hines.
The Paseo Place development would reactivate 11 empty street-level storefronts that together total 31,000 square feet.
Numerous dining spots, shops and other neighborhood-serving merchants that had occupied the building’s retail spaces were forced to shut their doors during the coronavirus outbreak.
Texas-based Hines intends to find ways to enliven Paseo de San Antonio by adding outdoor dining, shade and lighting to the walkway.
The real estate firm sketched out a game plan to fill the spaces by doing more than circulate marketing brochures.
“Ownership will implement an aggressive tenant recruitment program and provide incentives to attract high-quality restaurants and retailers and get businesses open to serve the community,” Schoennauer said.
One striking feature of the proposed revamp is a vibrantly lit clock tower next to Paseo Place, according to the planning documents.
“We want to make the clock tower a really cool lighting feature and make it an iconic tower to draw people in and be visually interesting,” Schoennauer said.
Hines also plans to modernize the building with upgrades to the building overall and the storefronts in particular. The structure’s exterior will receive new materials, lighting and signs to create an improved experience for pedestrians.
The data center inside the building that was installed 29 years ago will be modernized, according to Hines. The data center operation halted a few years ago, according to Schoennauer. The computer gear had become completely outdated.
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The upgrade is slated to increase the computer hub’s power capacity to 40 megawatts, Hines stated. The data center currently has access to 5 megawatts of power, according to a report from the DataCenters website.
The 150 South First data center, once it’s upgraded, will also contain modern high-density cooling and advanced emissions-control technology for emergency generators that would be consistent with Bay Area regulations, according to Hines.
Hines gained ownership of the property when the real estate firm paid about $59.6 million for the complex in 2021, a deal that marked the first foray into downtown San Jose by the veteran real estate firm.
Although data centers have been greeted with skepticism in some Bay Area cities, San Jose city officials appear to have embraced the general notion of data centers.
San Jose leaders point out that every new “fully functional” data center can generate $3.4 million to $6.8 million in city utility taxes and property taxes.
Some things appear certain: Santa Clara County is one of the nation’s largest and most quickly growing hubs for data center sites.
The move to upgrade and expand the power capacity of the data won’t diminish the visible efforts to improve the streetscapes adjacent to the building.
“The public-facing experience along the Paseo, First Street and Second Street will remain retail-oriented and pedestrian-focused,” Schoennauer said.
Hines Interests hopes to use provisions of the San Jose Innovative Project Pathway Program to streamline approval of the redevelopment since the real estate firm believes the project could provide an extraordinary benefit to the city, even if the project doesn’t fit readily into the text of the city’s general plan or zoning code standards, according to Schoennauer.
“The point is to make Paseo de San Antonio a much more comfortable and rejuvenated place,” Schoennauer said.
Two views of a retail, restaurant and data center complex, showing a brightly lit clock tower, at 150 South First Street in downtown San Jose, concept. (Hines)
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