SAN JOSE — A high-profile office building in San Jose whose ownership group is controlled by the co-founder of workspace pioneer WeWork could be converted into a housing complex with 100-plus units.
The downtown San Jose office building is located at 152 North Third Street and is owned by a group that’s linked to WeWork co-founder Adam Neumann. Max Fink, an executive with Flow, a startup founded by Neumann, is also involved with the building’s ownership entity.
An estimated 133 residential units will be created within the building, with apartments on each floor of the nine-story building, according to documents on file with San Jose city planners.
“This is a true win-win for the city,” said Robert Staedler, principal executive with Silicon Valley Synergy, a land-use planning and consultancy firm. “This would reduce the office vacancy rate and increase the number of residential units” in the downtown.
At one point, the nine-story building, perched at a prominent spot next to St. James Park, was slated to become a WeWork office hub.
The coronavirus outbreak and the fading Bay Area office market combined to torpedo those office plans.
Neumann’s group bought the 152 North Third building in 2018, paying $44 million, documents filed with the Santa Clara County Recorder’s Office show.
In 2021, the building owners obtained $45 million in financing from an affiliate of Rialto Capital Management, according to the county real estate records.
Then in the spring of 2023, the owner of the office building fell behind on payments for the property’s loan. the building totals 130,700 square feet.
The new plan for the property focuses on converting it into a residential building consisting primarily of the proposed 133 apartments, the public planning files show. This is a preliminary proposal that is being floated to gauge the reaction of San Jose political leaders and city planners.
“The existing nine-story building was constructed in 1985,” the planning documents state. “That construction retained a historic ‘Eagles Hall’ facade that was constructed in 1909.”
The conversion work won’t disturb the eye-catching historic exterior that fronts on Third Street.
“The historic facade will be retained and exterior alterations will be minimal,” the development proposal states.
Floors one and two would each have two residential units, according to the planning documents. Floor three would have 15 units. Floors four through nine would each have 19 units.
The current uses on the site are offices and a long-time sandwich shop on the ground floor, Freshly Baked Eatery. It wasn’t clear how much, if any, of the office space is currently occupied by tenants.
“The building was undergoing renovations to a WeWork use over the past four years,” the proposal on file with city planners states. “Not all of the work that had a building permit was completed.” CK2 Architecture submitted the proposal on behalf of the property owner.
A lounge, game and play room, two music studios and a work room would be located on the first floor.
A yoga studio, cinema room, two meeting rooms, co-work cafe, kitchen and fitness center would be part of the second floor.
A club room, several meeting rooms and an amenity terrace would be located on the third floor. The residences on this floor would all have private terraces.
Three of the units on the fourth floor would have private terraces.
None of the units on floors five through nine would have private terraces.
“Some elements of the recent renovations may be retained in the new residential use,” the proposal states.
A significant amount of demolition work was scheduled to occur on every floor, to varying degrees, according to the city planning files.
“The city of San Jose needs to do as much as it can to help make residential conversions like this happen,” Staedler said.
The addition of potentially hundreds of new residents in a residential building next to St. James Park might also help to create more vibrancy and activity in the area of the urban open space.
“More eyes on the park will help make St. James Park a safer place,” Staedler said.