SAN JOSE — A proposed tower that will mix offices, homes, and retail at a choice downtown San Jose site has landed financial boosts from investors drawn to the project’s game plan and its location in a tax-friendly opportunity zone.
The Carlysle, planned for a portion of a key downtown San Jose block at 51 Notre Dame Ave. next to Carlysle Street, would consist of multiple floors of offices, a number of floors of residences, as well as ground-floor retail, creating a unique mix of real estate in a single tower.
Acquity Realty, the principal owner and developer of The Carlysle, expects to launch construction sometime during the first three months of 2021 with the demolition of the existing buildings on the site, according to Acquity executives.
“We’re getting investors who are interested in the opportunity zone benefits that are part of The Carlysle,” said John Pringle, chief executive officer of Acquity Realty.
Other investors are primarily drawn to the project’s location and The Carlysle’s unusual mix of real estate in a single tower.
Just a few blocks away, Google has proposed a transit village of office buildings, homes, restaurants, shops, hotel facilities, open spaces, cultural centers, and entertainment venues near the Diridon train station and SAP Center.
“They just like the concept of The Carlysle, its location, and the opportunity zone benefits,” Pringle said.
The Carlysle is a tower that’s different from other highrises in the Bay Area’s largest city, said Erik Schoennauer, a San Jose-based land-use and property consultant who has been helping to steer the development proposal through the city planning process.
“To my knowledge, it’s the only building so far in San Jose that would have all three elements in one tower,” Schoennauer said. “It’s common in other cities like New York or Chicago with taller towers. In San Jose, this has not been the trend to date.”
Using a mix of all three development types also improves the project’s chances of success, Schoennauer said.
“By having office, housing, and retail in one highrise, the benefits are that you gain the relative strengths of each different use, and you mask the weaknesses of each use,” Schoennauer said. “That makes the tower in its totality feasible.”
About 12 floors of the 21-story tower will be residential, and about eight floors would be offices, with the bottom floor dedicated to commercial activities and a lobby.
“In all likelihood, the ground floor will be a restaurant, food services activities,” Schoennauer said. “Pre-COVID, that was in demand. A restaurant should do well because it’s close to San Pedro Square, Little Italy and the Arena.”
