As office spaces remain vacant across the country, and in San Jose, small business owners see it as an opportunity to grow.
Mauricio Mejia, the owner of Punch King Fitness, said the vacancies have allowed him to occupy space at a fraction of the cost.
“Other retail spaces that are out there are offering big discounts,” Mejia said. “They’re doing 60-70% discounts because they’d rather take something versus nothing because its affecting the value of their spaces.”
Retail space in San Jose sits at 7%, according to city officials.
The building owners where Punch King sits are offering space for a discounted price in order to keep tenants from moving. It’s a move Mejia is thankful for because, at times, he’s struggled with the high rent.
“When these guys are trying to get funding or refinances of their properties, and the banks come out to see all the empty spaces, the banks also become uncertain with what’s happening with the property,” Mejia said.
San Jose city official said they remain optimist about a turnaround as smaller shops and businesses move in.
Local
However, two large properties in downtown remain vacant contributing to 31% of office space vacancies in San Jose.
The Jay Paul building at 200 Park sits empty despite marketing the property heavily.
Get a weekly recap of the latest San Francisco Bay Area housing news. Sign up for NBC Bay Area’s Housing Deconstructed newsletter.
“[It’s] not leased yet, but they are talking to some folks,” said Nathan Donato-Weinstein, downtown manager with the city’s Economic Development Department.
The building at 200 Park offers close to 1 million square feet of office space.
Less than 2 miles away, Platform 16 building is also facing challenges. Construction of the over 1 million square foot building has halted.
Additionally, construction plans for City View Plaza, across the street from 200 Park, have also been stopped. It’s a trend Donato-Weinstein said he’s noticing across Silicon Valley.
“We do have an elevated vacancy rate for office space throughout Silicon Valley,” he said. “So, I think developers are kind of watching that closely.”
