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The Three Hottest Sub-Markets in the Bay Area: Part I

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An Overview of Santa Clara County

Competition for developable residential land is heating up in the Bay Area. This is due to increasing demand for housing from a booming tech economy, and the relative scarcity of new housing.

The projects cited below, provide an example of what is selling, how it’s selling, and a look at what’s coming down the development pipeline. Although these projects reflect only a sneak peek of the market, they do reflect some interesting trends.

 Santa Clara County

Gallery at Central Park

Currently Selling: The Gallery at Central Park

The former site of a Kaiser Permanente medical campus in Santa Clara is now home to a 766-unit, 27-acre mix of new for-sale housing and apartments.  D.R. Horton purchased the for-sale housing component which included 241 units consisting of both single family detached homes and townhomes. Prometheus took on the for-rent portion consisting of 525 apartments.

How they’re selling:

  • Roma: 68 row-style townhomes
    • Priced from $840,000 to 1,000,000
    • Selling at an average of .84 units per week
  • Siena: 57 two-story, single family detached homes
    • Priced from $1 to 1.3 million
    • Selling at an average of 83 units per week
  • Turin: 116 cluster-style townhomes
    • Priced from $1 to 1.2 million
    • Selling at an average of .3 units per week
  • Hearth: 525 apartments
    • Now leasing for $2700 – 3800

The preference of demand for the “American Dream” in housing (a single family detached home), is magnified with the approvals of Glen Loma, and several other large ranches slated for development in the near term.

The millennial workforce of today may prefer living in the urban core.  But as they begin to start families they will likely sacrifice convenience, for space (to attain to a larger unit and lot size), and good school districts associated with many of the large ranches currently being developed.

  Silvery Towers

 Coming Soon: Silvery Towers

A ground breaking ceremony was held February 2nd for the high rise project known as “Silvery Towers.” The two – 20 and 22-story buildings will house a total of 643 condos. Completion is expected in early 2017.

Full Power Properties bought the site on West St. James Street from KT Properties in August 2014. KT will still be involved in the development of this $250 million dollar development.

The Silvery Towers will be the largest residential high-rise in San Jose history.

Glen Loma Ranch

Proposed: Glen Loma Ranch 

What will be the largest residential project in Gilroy received approval of its first five neighborhoods in mid-2014. At full build out, the project will include:

  • 1643 total units
    • Includes single family detached, townhomes, apartments, and senior housing
  • 145 acres of parks & open space
  • A town center and possibly a fire station
  • Approximately 300 affordable units

The first five approved neighborhoods consist of the following:

369 total single family lots on 45 acres

  • Two neighborhoods by Brookfield Residential, one by Standard Pacific
    • Mataro by Brookfield: 52-home neighborhood
      • 3294 – 3724 square feet, up to 7 bedrooms
    • Ambrosia by Brookfield: 77-home neighborhood
      • 2113 – 2525 square feet, up to 5 bedrooms
    • Bella Vista by Standard Pacific
      • 146 homes

 

Source: Chris Meyer, Research Associate at Market InSite Real Estate Advisors