Canadian Developer Westbank Swaps Approved 14-story Office Building for Housing Development in Downtown San Jose

Amid a growing trend of remote work and high office vacancy rates, Vancouver-based developer Westbank has pivoted from its original plan to build a 14-story office building in Downtown San Jose. Instead, the firm now intends to construct an 18-story residential tower at 255 West Julian Street, as reported by the San Jose Mercury News.

New Residential Development Plan

The revised project, led by Westbank’s U.S. operations executive Andrew Jacobson, is described as a "majority residential development." Although details about the number of units or whether the building will feature apartments for rent or condos for sale have not been disclosed, the shift marks a significant departure from the previous office-centric proposal.

Original Office Building Plans

Westbank, in partnership with San Jose-based Urban Community, received approval in 2021 to develop a 14-story office building known as the Arbor. This 452,000-square-foot mass timber project was set to include ground-floor retail space, terraces, a rooftop garden, and connect to the neighboring Charles Davidson building. However, the pandemic-induced move towards remote work left a substantial portion of Downtown San Jose's office space vacant, leading Westbank to reconsider its plans.

Adapting to Market Changes

The pivot to residential development reflects a response to market conditions, with Downtown San Jose's office vacancy rate hitting 35.6 percent in the first quarter of the year. The new plan, which adds four stories to the original design, will include a commercial element and may incorporate four levels of underground parking, as indicated by Westbank’s request for a site development permit.

Ongoing and Future Developments

Westbank is actively engaged in other projects in Downtown San Jose. In January, the company and Urban Community were set to begin construction on a 540-unit apartment tower in the SoFa district. Additionally, the joint venture has started converting the historic 13-story Bank of Italy building at 12 South First Street into up to 150 residential units. This building, a Mediterranean Revival and Beaux-Arts landmark, was originally built in 1926 and designed by Henry Minton for the Bank of Italy, the predecessor to Bank of America.

Moving Forward with City Collaboration

Westbank remains committed to working closely with the City of San Jose to finalize the revised residential project. The firm aims to expedite the delivery of new housing as it navigates the planning and permitting processes.