Speakeasy is eyed at empty downtown San Jose tower, may be area magnet

Basement bar could help activate crucial San Jose intersection

SAN JOSE, Calif. — A speakeasy is on its way to an empty tower in downtown San Jose, a one-of-a-kind bar that the highrise’s owner hopes will spark the revitalization of a dormant section of the city’s urban core.

The bar will be located on the basement level of 2 West Santa Clara St., a currently vacant office tower owned by DivcoWest, a Bay Area real estate firm.

Drinks and a variety of other activities are among the anticipated features of the 2 West Speakeasy, according to documents filed with San Jose city officials.

“The 2 West Speakeasy is a public drinking establishment located in the heart of downtown San Jose,” according to the city planning documents. “The venue will operate as a speakeasy bar with occasional live music and DJs, and host private events.”

In 2017, DivcoWest paid $14.4 million for the 10-story tower via an affiliate. The real estate company then began extensive renovations to the building. Because of its former use as a branch and office site, the 2 West Santa Clara tower is also known as the Bank of the West building.

This tower, which has yet to find a tenant, is far from the only vacant office space at the intersection of Santa Clara and First Streets in downtown San Jose.

The historic Bank of Italy tower at 12 South First St., owned by global mega-developer Westbank, is vacant. Jay Paul Co., one of the Bay Area’s most successful and savvy developers, owns an office building at 1 West Santa Clara St. A Los Gatos-based investor recently purchased an office building at 2 North First St., which has a high vacancy rate.

Bottom line: The intersection of First and Santa Clara streets, which was once the vibrant heart of downtown San Jose before suburban malls sapped the city’s retail base, has degraded into a desolate quartet of corners.

A difficult downtown economy, the coronavirus outbreak, and the flight of office workers as a result of government-imposed lockdowns to combat the pandemic have combined to defy the efforts of the trio of top-tier developers.

DivcoWest now hopes that the proposed speakeasy will help put the forlorn intersection back on track to a bright future.

Patrons should enter the speakeasy via the main entrance on West Santa Clara Street. It will be open every day until 2 a.m. The restaurant is legally allowed to open as early as 6 a.m., but it will most likely not open until the early afternoon.

“The venue will offer a variety of live music and live performances, ranging from jazz to DJs,” according to city documents.

According to the development proposal, which the City Council approved on Oct. 17, the speakeasy would be approximately 6,500 square feet in size.

Two bars are planned for a basement area known as “The Vault” because of its proximity to the old bank vault.

This proposal comes as DivcoWest has indicated to San Jose officials that it is considering a comprehensive transformation and conversion of the office tower. To replace the office spaces, DivcoWest is considering residential, co-living, or hotel rooms.

The following are the primary options being considered by DivcoWest for the Two West Santa Clara office tower:

— An apartment version with 65 residences and ground-floor retail on the street corner that was home to a Walgreens pharmacy for many years until it closed in 2018.

— A co-living option with 73 residential units and ground-floor retail.

— A 147-room “micro hotel” version with ground-floor retail.

According to a letter sent on Oct. 12 to San Jose government officials, including the mayor and the rest of the City Council, DivcoWest believes the speakeasy would provide at least three benefits to the downtown.

According to the consultant’s email, the speakeasy provides a unique new space for downtown San Jose.

“Locals and visitors alike seek out unique and hidden bars in urban neighborhoods for fun and social times,” Schoennauer wrote to city officials in an email. “This proposal will add to downtown’s existing attractions.”

According to the letter, the basement bar could increase pedestrian activity in a “depressed” area of downtown.

“This new lounge will create a reason for people to walk to this block of downtown, helping to activate the streets again, especially in the evening or after dark,” Schoennauer said in an email.

The new basement bar may also entice tenants to take up residence in the 2 West Santa Clara tower.

“This basement speakeasy lounge is part of the owner’s strategy to reactivate the building and find tenants,” Schoennauer explained in an email. “The hope is that the lounge will be a desirable amenity and will promote positive pedestrian activity to make the block feel more safe and pleasant.”

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