AI Firms Are Driving Silicon Valley Office Leasing

Two AI firms, Cupertino-based Etched and San Jose-based Securiti.ai, rented offices in San Jose’s upscale Santana Row, per The Real Deal.

AI Driving Office Leasing

The companies leased a combined 60.4K SF in the One Santana West building at 3155 Olsen Drive, according to the San Jose Mercury News.

Etched, which develops AI semiconductor chips, signed a lease for the 49.5K SF second floor, while Securiti.ai, specializing in AI-driven data security solutions, took 10.9K SF on the third floor.

The leases follow Federal Realty’s decision to shift from an initial plan of securing a single tenant for the entire 375K SF building to leasing it out in sections.

This decision has boosted occupancy, with One Santana West now 80% leased.

Growing Tenant Roster

According to Jan Sweetnam, CIO of Federal Realty, Santana Row offers a unique combination of modern office space and premium amenities, making it an attractive destination for high-growth companies.

The building has attracted a diverse mix of tenants, including PwC US (141K SF), Acrisure (29K SF), Couchbase (23.7K SF), Calix (23K SF), Pivot Interiors (15K SF), and BetterHelp (10.4K SF).

The Good Eating Company has also secured space to open a full-service café on the ground floor.

Silicon Valley Outlook

Despite sector challenges, Santana Row is outperforming local office markets.

One Santana West’s 20% vacancy rate is slightly lower than the 21.8% vacancy for Silicon Valley in Q3, according to JLL and Joint Venture Silicon Valley.

South Bay office availability, which includes vacant and sublease space, was 25.9% at the end of last year, per Savills.