SAN JOSE — A big San Jose office building whose principal owner is a high-profile real estate firm has tumbled into a loan default, an ominous reminder of worsening woes for the Bay Area office market.
The office building is located at 2290 North First Street within the key tech and business hubs in north San Jose.
Office and research building at 2290 North First Street in San Jose. (George Avalos/Bay Area News Group)
San Jose-based Green Valley Corp., a real estate firm, is listed as the sole member of the entity that owns the building. The documents for the 2021 loan that’s in default state that Case Swenson is Green Valley’s chief executive officer. Swenson also is CEO and president of the Swenson firm, according to the company’s website. The Swenson firm is a Bay Area real estate industry stalwart.
The 2290 North First building isn’t the only north San Jose office property to struggle financially:
— 3100 North First Street was foreclosed and seized by its lender at a value of $19 million in May 2024 — and was then bought for $17.5 million by a fast-expanding biotech company in September 2024. In January 2024, the Santa Clara County Assessor’s Office placed the then-empty buiilding’s value at $32.1 million.
— 10 West Tasman was taken back by its lender through a foreclosure in October 2024 for $23.7 million, far below its assessed value of $51.3 million at the start of this year. The foreclosure occurred despite the former owner’s efforts to forestall the foreclosure by filing for bankruptcy.
The loan default on the 2290 North First building comes as the Bay Area office market is taking on water in forbidding economic seas.
Office vacancies have skyrocketed, largely because tech companies have cut back on their workspace requirements after the coronavirus shutdowns, even with the lifting of the restrictions.
These calamities, in turn, have eroded office property values, which might nudge building owners to simply walk away from their loans and cease making mortgage payments.
In 2021, Prime Finance Short Duration Holding Co. provided a $12 million loan for the 2290 North First office building.
As of the date of the default notice filing, the unpaid debt on the office building was $10.1 million.
The building totals 75,900 square feet, according to the Compstak commercial property website. It wasn’t immediately clear how much space, if any, was vacant in the building. This news organization reached out to the Swenson firm’s public relations representative to request a comment about the situation.