Hines Unleashes Industrial Boom in San Jose: Houston-based developer Hines Interests Limited Partnership is making significant moves in South San Jose with plans for three expansive warehouses spanning almost 45 acres. The primary project involves seeking approval for a 234,000-square-foot industrial facility on nearly 16 acres of vacant land at 644-675 Piercy Road. This proposal is set to undergo consideration at a Planning Director’s hearing. Hines, a privately held firm with operations in 30 countries managing around $94.6 billion in real estate assets, is not stopping there.
In addition to the 644 Piercy proposal, Hines has its sights on two more warehouses, totaling 422,670 square feet, situated on almost 29 acres of contiguous land to the north at 550 Piercy Road. These strategic plans are unfolding in the southeastern corner of San Jose’s Edenvale district, just south of Silver Creek. The area is currently marked by a mix of industrial buildings housing various firms engaged in research and development, high-tech manufacturing, assembly, and testing. Additionally, the locale accommodates some medical device and pharmaceutical industry tenants, large-format churches, and housing developments.
While the specific tenants for these warehouses remain undisclosed, the city’s long-standing encouragement for industrial development in the region reflects the ongoing trend. Flexible warehouse space, offering stability in contrast to the volatile housing construction market, has maintained its strength, even post-pandemic, when compared to the decline in office space demand.
Mayor Matt Mahan acknowledges the robust demand for industrial space in San Jose, emphasizing the city’s demonstration of what ‘Made in America’ looks like in the 21st century, with nearly one in five workers engaged in manufacturing and industrial vacancy rates below 3%.
District 2 Councilmember Sergio Jimenez, representing the area, expresses support for these projects, recognizing the positive implications of substantial investments in the city. While the warehouses are adaptable for various uses, Jimenez notes the strategic appeal for investors seeking proximity to the substantial market in the South Bay.
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However, the developments have not been without concerns. Residents in the nearby Basking Ridge development area have raised issues related to truck traffic and noise due to the numerous warehouses in the vicinity. In response, plans for the 644-675 Piercy project indicate measures such as allowing car traffic only on Tennant and routing freight trucks to use Hellyer Avenue for entry and exit, aiming to mitigate neighborhood impacts.
Beyond Hines, other investment groups are also eyeing warehouse projects in the area. Xebec, a Dallas-based real estate development and investment firm, recently secured approval for a 134,589-square-foot warehouse at 469 Piercy Road. Additionally, a 14-acre parcel at 455 Piercy is being considered for a roughly 121,000-square-foot warehouse project by Southern California self-storage developer InSite Property Group.
These developments underscore the ongoing dynamism in San Jose’s industrial landscape, aligning with broader economic trends and the city’s commitment to fostering industrial growth.