SAN JOSE — The Capital Club, a downtown San Jose go-to site for Silicon Valley business and political gatherings, will soon close — but a tech firm has already struck a deal to take over the iconic highrise spot.
Silicon Valley Capital Club, whose perch just below the rooftop of a San Jose office tower at 50 West San Fernando Street commands views of the South Bay in all directions, intends to close its doors on New Year’s Eve this month, ending more than three decades of operations.
50 West, an 18-story office tower at 50 West San Fernando Street in downtown San Jose. (George Avalos/Bay Area News Group)
Yet even as the Capital Club prepares to end a 34-year run that began in 1990 when it was founded, the club’s exit that coincides with the conclusion of its lease in the 50 West office tower also clears the way for a tech company to expand its operations in the same highrise, according to multiple commercial real estate sources familiar with this and other transactions in the highrise.
The Trade Desk, a software company, has crafted a deal that enables it to rent the roughly 17,000 square feet that Silicon Valley Capital Club occupies on the 17th floor of the office tower at the corner of West San Fernando Street and South First Street in downtown San Jose.
View of downtown San Jose from the Silicon Valley Capital Club outside deck on the 17th floor of the 50 West office tower. (George Avalos/Bay Area News Group)
The software company is located on the 18th floor where it leases about 14,000 square feet.
The Trade Desk will retain its space on the top floor and then expand to the 17th floor below once the Capital Club departs, according to the sources.
Separately, another tech company and some professional services firms are expanding in the 50 West office tower, the real estate sources stated.
CoActive AI, an artificial intelligence tech company, has agreed to lease 15,000 square feet on the 11th floor of the office tower, sources reported.
Jay Paul Co. is the principal owner of the 50 West office tower, which the veteran real estate firm bought in 2019 for $238 million, acting through an affiliate. Newmark commercial real estate brokers Phil Mahoney and Mike Saign are marketing the building and seeking tenants for the tower. Mahoney declined comment regarding the leasing activity.
Silicon Valley Capital Club officials used an email, which this news organization has obtained, to notify members that the club had decided to halt operations after this year.
“After considering numerous options for a viable path forward, we’ve made the very difficult decision to permanently close Silicon Valley Capital Club,” Vincent Mauriello, a senior vice president with Invited, the owner of the Capital Club, stated in the email. “Our last day of operations will be Tuesday, December 31, 2024, with the conclusion of our lease.”
The economic maladies spawned by the coronavirus outbreak played a part in the demise of Silicon Valley Capital Club, the organization said.
“This decision was not made lightly and reflects the current circumstances that have affected our operations in the post-COVID era,” Mauriello wrote in the Dec. 3 email.
The private club, which features lofty views in all directions of the South Bay, hosts private meetings, weddings and other events and gatherings. It also offers dining services for the array of events that it hosts.
Yet even with the departure of the club, the 50 West tower is expected to have dining services that will be open to the public on the ground floor.
An urban and chic dining spot envisioned by a top-notch Bay Area chef is slated to replace the empty space formerly occupied by KQED on the tower’s ground floor.
Parke Ulrich, of the acclaimed Waterbar and Epic Steak restaurants in San Francisco, will be the executive chef of the new restaurant.
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The downtown San Jose dining establishment being prepared by Ulrich will offer lunch, happy hour specialty cocktails and dinner in an indoor and outdoor concept, real estate sources said.
Jay Paul Co. and Newmark are pursuing a wise course in their efforts to sign leases with robust tenants such as tech companies to replace a departing organization such as Silicon Valley Capital Club, in the view of Bob Staedler, principal executive with Silicon Valley Synergy, a land-use consultancy.
“50 West is an iconic fixture in downtown San Jose and it’s prudent for Jay Paul Co. to pivot so the building can remain active and leased up,” Staedler said.
Jay Paul and Newmark are proceeding nimbly to land tenants such as the ground-floor restaurant to fill the KQED space, a move that creates more accessible dining options for both tenants as well as the general public, in Staedler’s view.
“While it may be a shock that the Capital Club is closing, adding food services on the ground floor makes sense,” Staedler said. “It’s encouraging to see tech companies expanding in downtown San Jose. All deals are good deals for the downtown.”
