SAN JOSE — Whole Foods, a high-profile grocery store, has leased space as an anchor for the revamped El Paseo de Saratoga mixed complex that could become a new urban village in west San Jose.
The deal for Whole Foods was disclosed in a presentation at a community meeting on Jan. 20 by the project’s principal developer, Sand Hill Property Co.
“A major grocery will anchor the site and set the tone,” Sand Hill Property and its primary architects for the development, Kenneth Rodrigues & Partners and KTGY Architecture, stated in a final presentation for the community meeting.
The transaction to land Whole Foods is a major win for Sand Hill Property Co.
“Whole Foods is a fantastic anchor for the project that will immediately solidify this project as a dynamic, urban community gathering place for the entire neighborhood,” said Erik Schoennauer, a San Jose-based land-use and property consultant.
The wide-ranging revamp of El Paseo de Saratoga could transform the existing big-box mall in San Jose into what could become a smaller version of the iconic Santana Row.
The vast redevelopment effort would focus on two sites at the intersection of Saratoga Avenue, Lawrence Expressway and Quito Road: El Paseo de Saratoga, a prominent San Jose shopping center, and a much smaller property across the street, city documents show.
“Major new commercial space, major new housing, and a major emphasis on high-quality community gathering spaces, with a new park, ground-floor retail, and outdoor dining and plazas” are the key elements of the project, Schoennauer said.
The current development model for the proposal envisions 994 residential units. The residences would offer a mix of studios along with one-, two, and three-bedroom units, the presentation showed.
“The addition of Whole Foods just made the development and the adjacent residential units more valuable,” said Bob Staedler, principal executive with Silicon Valley Synergy, a land-use consultancy. “It’s a great sign for what is to come with this plan.”
In addition to the housing and the retail, the redevelopment plans envision 165,000 square feet of commercial space, consisting of 159,000 square feet on the El Paseo property and 6,000 square feet on the 1777 Saratoga parcel.
Even before the coronavirus erupted worldwide, conventional shopping centers, especially those with big-box retailers, had begun to flounder. The increased popularity of e-commerce prompted more consumers to shop online instead of in-person store visits.
The onset of the virus chased away even more shoppers from malls that were shuttered as a result of wide-ranging business shutdowns to combat the spread of the deadly bug.
Commercial centers such as Santana Row and Westfield Valley Fair have managed to prosper and have regained the vast majority of their pre-coronavirus foot traffic. That’s because these centers offer active experiences that go beyond simply shopping in a store to peruse and buy merchandise.
“It does seem there is a place for highly specialized, high-end retail,” Mark Ritchie, president of real estate firm Ritchie Commercial, said in an interview last October about the revamp at the El Paseo center. “The only kind of retail that is doing well now is the Santana Row-style high-end retail and restaurant.”
The project, if given approved and built, wouldn’t replace the entire El Paseo de Saratoga complex and would occur only on a 10.7-acre section of the retail hub, according to city documents. AMC Saratoga 14 movie theater, REI camping store, Petco and Ulta Beauty are operating in the center.
“This project is a poster child for what a Signature urban village project should be,” Schoennauer said.
