Apple contemplates San Jose expansion: What it means for Silicon Valley'

Apple Inc. is looking to north San Jose for a major expansion, real estate sources have told me over the last several weeks. While Apple isn't talking, the possibility has generated excitement in industry circles and could hold implications for the city that go beyond real estate.

“It would transform the image of San Jose and have a real branding impact,” said site-selection expert John H. Boyd of the Boyd Co. “People will look at San Jose differently if it happens.”

Apple has been shopping at least two major projects: Ellis Partners’ 300,000-square-foot 101 Tech on Orchard Parkway and Hunter/Storm’s Coleman Highline development site near the Mineta San Jose International Airport, according to industry sources. The latter could include more than 1.5 million square feet of office, research and development or light industrial space.

No deal is done, and Apple is not the only company to show interest in the locations. Tesla Motors Inc. has also looked at the Ellis site, the former headquarters of Atmel Corp., according to sources. It's possible Apple won't sign any deal in San Jose. Apple, and representatives for the projects, declined to comment.

If it happens, though, landing one of the Valley’s glittering stars would symbolize progress in San Jose’s long-running quest to attract additional high-profile tech tenants. It would also generate economic follow-on effects and complete a story arc begun more than three decades ago when Apple first flirted with a big move into San Jose.

‘There’s not some magical wall out there’
Apple’s purported interest comes as the Cupertino-based company is in the midst of a massive real-estate leasing spree, with a space requirement of perhaps two million square feet or larger. The company’s appetite includes office, research and development, industrial and warehouse space — and that’s above and beyond its high-profile “spaceship” campus underway in Cupertino. I first wrote about the expansion push last month.