Apple enters deal to lease offices slated to be built in Santa Clara

Site on Stevens Creek Boulevard has been cleared, construction expected to begin soon

SANTA CLARA >> Apple has widened its Silicon Valley expansion efforts through a new deal in Santa Clara that calls for the tech titan to lease a big — and yetto-be-constructed — office building.

The technology company has struck a deal to lease a large office building on Stevens Creek Boulevard in Santa Clara that would sprout on the site of a nowbulldozed IHOP restaurant site, according to several sources with expert knowledge about the transaction.

The future office building will be built by legendary development firm Peery Arrillaga, which a few years ago leased an adjacent 187,000-square-foot office building at 5409 Stevens Creek Blvd. to Apple.

The 148,000-square-foot building that Apple has just leased is located at 5407 Stevens Creek. This week, the site was cleared away, fenced off, and accommodated some construction equipment.

Cupertino-based Apple calls the building that it now occupies Apple Stevens Creek Eight. Vehicles could be observed this week accessing an adjacent parking structure that connects to the existing building.

The two Santa Clara buildings that Apple has leased are just down the street from a prominent San Jose structure known as The Triangle Building at 5300 Stevens Creek Blvd., totaling 86,000 square feet, that also has been rented to Apple.

Interior construction work was underway this month at The Triangle Building. Apple logos were observed throughout the six-story San Jose office building.

The three office building sites are all one mile away, or less, and fewer than five minutes away by vehicle, from the Apple Park spaceship headquarters complex in Cupertino.

Apple could potentially employ 2,100 people in the three buildings, using commonly accepted employee and office space ratios as a yardstick.

“Apple is one of the top companies around, they are very strong, and they have a need to have employee groups near their headquarters,” said David Vanoncini, an executive vice president and managing director with Kidder Mathews, a commercial real estate firm.

The 5409 Stevens Creek offices could contain 935 workers, the future 5407 Stevens Creek site could accommodate 740, while The Triangle Building could house 430 employees.

“These are sites that make a lot of sense for Apple,” Vanoncini said.

Apple didn’t discuss its leasing activity in this area. Developers John Arrillaga and Richard Peery, as is their decades-long custom, couldn’t be reached for comment regarding the transactions.

The trio of buildings could effectively act as a loose-knit mini-campus for Apple. They are within a half-mile of each other. That would make for a brisk walk along Stevens Creek or a three-minute car ride between the Santa Clara site and The Triangle Building just across the border in San Jose.

Still, some commercial property experts in this region note that the most dramatic expansions Apple has launched frequently transpire outside of the Bay Area.

“Apple has announced a major expansion of its operations in Austin, including an investment of $1 billion to build a new campus in North Austin,” the tech titan stated in a December 2018 post on its web site.

The post made no mention of Bay Area expansions.

“The company also announced plans to establish new sites in Seattle, San Diego, and Culver City.” Apple added in the post that it also intended to give birth to employment hubs elsewhere, such as in “Pittsburgh, New York, and Boulder, Colorado over the next three years.”