Developers of a proposed mixed-use village in Santa Clara are considering replacing office space with industrial uses such as warehouses and data centers. Originally approved in 2016, the development will feature over 9 million square feet of residential, commercial, and entertainment space. However, escalating construction costs, regulatory hurdles, and a lawsuit have caused significant delays. With Silicon Valley's office vacancy rates around 16%, the city council approved a plan to decrease office space from 4 million square feet to 1.6 million, adapting to current market demands for more industrial uses.
Instead of building roughly 4 million square feet of offices on the northeastern section of the project, Related wants to put in 1.6 million square feet of industrial or manufacturing space.
The offices are expected to be transferred to the part of the project known as the City Center, the heart of the development that will serve as the main entertainment core.
Nicholas Vanderboom mentioned that the new plan will allow them to adapt to the changing market, which has been demanding more space for manufacturing and industrial uses including data centers.
Consolidating the office into the City Center will ultimately help with feasibility, because that's the type of office that is in demand.
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