1M SF-Plus of MXD Is the Goal for Palm Land

SAN JOSE, CA-Thirty-nine acres of raw land here is on its way to becoming a 1.2 million-sf commercial mixed-use development. Closing a deal that was inked more than a year ago, Deke Hunter and Ed Storm, the principals of Cupertino, CA-based Hunter Properties, paid Palm Inc. $70 million for the land, which at one time was slated to become the handheld computer maker‘s headquarters.

Hunter tells GlobeSt.com that he is now seeking development approvals for a project that will include 880,000 sf of class A, LEED-certified office space in four buildings; a 100,000-sf hotel; 75,000 sf of retail space occupied mostly by restaurants; a health club; meeting space; and a separate 150,000-sf retail anchor that has not yet been announced. The first phase, tentatively set to get under way in February, would include all of the retail, the hotel, the health club and half of the office space, he says.

“This site is the gateway to San Jose from Highway 237,” Hunter tells GlobeSt.com. “Our idea is to embed a corporate campus environment in a top-tier, class A retail concept with outdoor dining, plenty of parking and other amenities.”

More than half of the non-anchor retail space will contain eateries and the parking ratio for the office will be four for every 1,000 sf of net rentable area.

In SEC filings, Palm Inc. says that $5 million of the sale price will be applied toward possible traffic mitigation fees Hunter and Storm will have to pay to mitigate the traffic impacts from their proposed development. Palm would keep any excess funds.

The acquisition of the land from Palm comes shortly after Hunter and Storm sold off the last of 14 buildings it acquired in Cupertino, CA, in 2000. The area is know known as Civic Park. Earlier this month, Hunter and Storm sold off the last of the buildings, three wood-frame, two-story office properties totaling 60,000 sf net rentable.

TA Associates Realty paid about $17 million for the buildings, according to one local source. Hunter says the land on which the three buildings sit is entitled though 2010 for 125,000 sf. Colliers brokers Warren Sattler, Mark Kuiper, Hitoshi Takahashi and Bing Heckman represented the TA Associates in the transaction.