Professional services firm’s Santana Row deal in San Jose is long-term: official records
SAN JOSE — A professional services titan that recently struck a deal for a big office lease in San Jose crafted the agreement as a long-term commitment to the Santana Row mixed-use neighborhood.
PwC recently signed a lease to occupy 141,000 square feet of space in One Santana West, an office building at 3155 Olsen Drive in San Jose across the street from the main area of Santana Row, whose primary owner and developer is Federal Realty Investment Trust.
The rental deal by PwC represented the second major leasing agreement at One Santana West, which is successfully attracting new tenants to Santana Row.
Acrisure, a fast-expanding financial technology and insurance company, leased 29,000 square feet in One Santana West late last year.
Together, the two leases have filled up about 45% of One Santana West, which totals about 376,000 square feet.
It now turns out that PwC has committed to a long-term lease that is poised to keep the professional services giant at Santana Row for a considerable time, according to documents filed on April 3 at the Santa Clara County Recorder’s Office.
The initial lease term is slated to last 11 years, specifically 132 months. The lease began on March 29, which would indicate that the rental agreement would expire in 2035.
However, the lease agreement also includes a pair of five-year options to extend the lease. These could take the rental deal to 2030 or 2025.
The two rental agreements represent significant wins for Santana Row at a time when the Bay Area office market has begun to stagger beneath the weight of expanding vacancy rates and slumping rents.
Newmark, a commercial real estate firm that is scouting for office tenants in Santana Row, has used the array of amenities at the destination neighborhood to entice tenants to sign up for spaces in One Santana West.
“Santana West delivers on every reason to want to come into the office,” Jan Sweetnam, chief investment officer with Federal Realty, said when the PwC lease was disclosed.
The real estate executives point to the restaurants, shops, housing, entertainment and hotel choices at Santana Row in their efforts to attract tenants in a tough office market.
“Santana West offers the ideal combination for companies seeking modern and efficient workspace and the deepest set of amenities available in the market,” Sweetnam said.