sunnyvale peery park presentation

Community Workshop #1

Existing Conditions & Workplace Trends, Market Analysis,

Broad Brush Strategic Framework

© 2012 Freedman Tung + Sasaki - except outside sourced material www.ftscities.com

PEERY PARK SPECIFIC PLAN & EIR

City of Sunnyvale October 16, 2013

Tonight’s Agenda

Open House

Presentation

• District History & Workplace Trends

• Market Analysis & Development Feasibility

• Urban Design Strategy and Actions

Q & A

Comment Exercise

Comment Review

Open House

6:30pm – 7pm

7pm – 7:45pm

7:45pm – 8pm

8pm – 8:30pm

8:30pm-8:45pm

8:45pm – 9pm

Urban Design, District Strategy, Land Use & Development Regulations

Environmental Impact Analysis

Fiscal Analysis

Market Analysis & Feasibility

Circulation and Access

City Staff Reviews & Guides Everything

Plan Framework: Key Community Meetings

• Stakeholder Interviews

• Online Survey

• Community Workshop 1: Existing Conditions & Workplace Trends, Market Analysis, Broad Brush Strategic Framework

• Community Workshop 2: The Envisioned future District, Mobility analysis, Streetscape Improvements, Regulatory Framework

• Stakeholder Workshop: Overview of Plan Concepts

• City Council/Planning Commission Study Session:

Recommended Plan Framework

A Specific Plan is the community’s most powerful tool

to guide change directly to “make a better city”

The Specific Plan

1. Community Intent

2. Development Regulations

3. Planned City Actions

The Specific Plan

1. Community Intent

The Envisioned Future District

District Planning Strategy

2. Development Regulations

3. Planned City Actions

Our Task: Recommendation to the City Council

Vision for the future of

Peery Park.

Envisioning what Peery Park can be requires understanding what it is today AND what made it that way

Early 20th Century: “Industry” Reorganized Around Assembly Lines

• Synchronized

• Low skill

• Organized by component tasks

• Mass production

Business park

Shopping Center

Housing Subdivision

City as Machine (CIAM 1933)

© Freedman Tung + Sasaki 2012

Economy = Making & Moving Goods: Cities re-organized using

Industrial Principles

Sunnyvale’s First General Plan: 1954-57

Neighborhoods Industrial Areas City

The Advent of Suburbia:

1950 - 1970 Sunnyvale’s population grew almost 500%

Image: LIFE Magazine

Roughly 80% of Peery Park built out between 1960 and 1990

1981 LUTE

Sunnyvale’s First General Plan: 1954-57

Housing and Workplace in Sunnyvale Today

Housing Workplace

The Experiment FIT with the industrial economy of the Era.


Business park

Shopping Center

Housing Subdivision

Surrounding Context

• Residential Neighborhoods

• Silicon Valley Workplace Districts

• El Camino Real Corridor

Major Destinations

• Downtown, Historic Murphy Street, & City Hall

• Moffett airfield

Activity Within the District

• Maude & Mathilda Center

• Mary & Corte Madera

Existing Pattern of Development

Existing Ground Floor Land Use

Newer Development • Multi-story • Conventional office

park configurations with low lot coverage

• Larger floorplates

Older Development • Low-rise • High lot coverage • Smaller footprint

Existing Development

Pattern

Streetscapes and Setbacks

• Shallower landscaped setbacks • Entrances oriented to the street • Truck Loading

• Conventional office park buildings • Deeper setbacks with surface parking • Entrances oriented to parking

Older Development Newer Development

Walkability • Large Blocks • Limited sidewalks

Pedestrian & Bike Activity • Relatively low overall • Highest during lunchtime

(including some exercise) • Company Bikes

Picture of activity/linkedin bikes + map of activity centers

Existing sidewalks

Existing Development Pattern

• Mathilda Corridor

• Older Development

• Newer Development

• Limited public gathering spaces & amenity

2011 General Plan: Potential Growth

Areas


Business park

Shopping Center

Housing Subdivision

Does the 20th Century approach to city-building FIT with the

economy built by Silicon Valley?

…the Story of the Economy Built by

Silicon Valley…

1900’s: Financial/trade hub with relatively small manufacturing base

1920’s: Amateur radio hobbyists (maritime activity) • information sharing, experimentation, technical innovation

1940’s: Vacuum Tubes entrepreneurs • High tech manufacturing and integrated research-engineering-production

1950’s & 60/’s: Semiconductor entrepreneurs (and spin-off companies) • High tech manufacturing supplied by vacuum tube industry and new

management techniques and organizational structures

1970’s: Integrated Circuit spin-off companies • Created new markets world-wide, built up the venture capital markets in

the region, and drew from the pool of skilled semiconductor workers

1980’s: PCs in the tradition of HAM radio • Built on established manufacturing industry

1990’s – Today: Internet and Software • Continuing the tradition of entrepreneurship, innovative technology, and

the changing workplace

The Origin of Silicon Valley

• Built on existing strengths

• Synergy between research, design, engineering, and manufacturing activity

• Skilled labor pool

• Access to investors (San Francisco)

• Access to customers (Defense/Nasa)

Silicon Valley’s Success: Accumulation of Local Skills & Unique Knowledge

The Nature of Work has Changed

Wide-spread & rapid digitalization has led to fundamental changes in work activity

Less labor needed to move and make things = more time thinking, strategizing, and analyzing

This process is called Innovation and it has become the primary wealth-generator

in the new economy.

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Innovation is a social process

• Group collaboration

• Different

specializations, skills, experiences, and perspectives.

Source: analytics20.org

• In the office and the lab

• In the conference room

• In cafes, bars and restaurants

• During breaks, recreation and leisure

• Especially while socializing

Essential Principle: Innovation requires settings that bring people together to collaborate and exchange ideas

Saskia Sassen: These trends are not just about

software and design, but also about mining and agricultural industries,

all industries.


Changes are Already Underway INSIDE the Workplace

Changes INSIDE the Workplace:

New Work Processes

New Offices Layouts

New Workspace Formats

Decentralization & skilled labor i.e: Pixar, 3M, Google,

Amazon, Facebook Co-working spaces, work cafes,

“Hacker villages”…

GOOGLE AMENITY

But Changes INSIDE the Workplace are not Enough

Low Density and Auto Oriented No activity centers

Landscaping but no “Public” Space Inward focus hides activity

Because 20th Century CBDs and Business Parks…

…no longer fit the needs of the innovation economy

Roughly 80% of Peery Park built out between 1960 and 1990 Before the internet, smartphones, etc.

1981 LUTE

Workplace districts must be physically re-shaped

to survive in the innovation economy

Reshape the District: Dynamic Mix of Uses

Segregated by type of work (office, R+D, manufacturing) with little variation

The Workplace District remains out of sync

Innovation Ecosystem:

Dense Collaborative Network of Partners, Suppliers, Customers

Companies at Different Stages in their Lifecycle

Range of Building & Workspace Types

Established Corporate Space

Quality Medium Sized Space

Creative rehab – lower cost spaces

New lower cost, small scale space

Tenant Mix with a Single Building or Complex

Source: 5M/Forest City © Freedman Tung + Sasaki 2012

Reshape the District: Activity

No activity focus or center


Retail is Critical to Activity.

Where (and how) to build retail is a central strategic decision.

Workplace districts have a unique pattern of retail

Lunchtime Activity • Convenience (3min walk) • Variety • Small plazas and outdoor

eating • Food trucks After Work Activity • Happy hour • Home-bound errands • Health and exercise

Reshape the District: Amenity & Image

Plenty of Open Space but no “Public” Space


The Emerging 21st Century Workplace District Model: Settings for Convenience, Interaction, Activity

Ideas on Display

Public studio viewing room

BBC Sport production activity

“Dense Clustering” of People, Skills, & Ideas

Strategically Located

Activity Generating Retail

Settings for Interaction & Activity

Connectivity + Amenity

Activity + Good Urbanism goes a long way, but truly Cutting-Edge Districts need a MORE hands on approach

20th Century:

Economic Value Created by Large Firms

Economic Development Attract Large Firms


Wrigley

Change#1: The scale & complexity of business operations has increased dramatically

Change #2: Work is distributed among a highly connected network of

specialized, collaborating partners, and service providers

Change #3: There has been sharp growth in producer services

To service the more complex business ecosystem.

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1980 1990 2000 2008

Source: Sassen – Cities in a World Economy (2012)

• Advertising • Consulting • Accounting • Design • Engineering • Software

Firm Size

1 to 9 10 to 99 100 to

499 Over

500

All firms 48% 20% 5% 17%

Manufacturing Firms 49% 32% 7% 11%

Professional, Scientific, Technical,

and Other Services Firms 75% 16% 2% 7%

All employment 11% 24% 14% 51%

Manufacturing Employment 5% 22% 18% 55%

Professional, Scientific, Technical,

and Other Services Employment 24% 34% 13% 29%

The Majority of Producer Services are

Small & Medium Sized Firms

Change #4: Small and medium-sized firms have become the most dynamic component of the economy.

Survey: In the next 10 years who will drive innovation the most?

To be successful in this transformed economic landscape, Cities must: 1. Actively attract and accommodate small and medium sized firms along with large ones.

The Critical Role of Small Firms &

Start-Ups in the Innovation Process

Large firms innovate by purchasing small firms &

integrating innovative components

Over 100 including:

Android, Picasa,

Frommers, Zagat

Over 30 including:

Instagram

Over 40 including:

Siri

To be successful in this transformed economic landscape, Cities must: 2. Attract and accommodate businesses in a variety of synergistic industries.

To be successful in this transformed economic landscape, Cities must: 3A. Attract Knowledge Workers & Innovative Businesses.

The “creative class” craves vital centers

Streetlife Public Spaces Transit

Innovative Firms Locate Near Talent Pools

The same characteristics that drive innovation & sustainability

To be successful in this transformed economic landscape, Cities must: 3B. Produce Knowledge Workers & Innovative Businesses.

Make the District A “Knowledge Center”

Innovation Anchors: “Institutions” that actively facilitate collaboration and knowledge exchange

How much and what type of

development can we anticipate?

Market Context, Demand, and Feasibility The Concord Group

Key Area Summary

Geography Peery Park Sunnyvale

Santa Clara

County

Population ('13) 1,937 143,714 1,843,474

Share of County 0.1% 7.8% --

Employment (2013) 10,605 76,247 914,710

Share of County 1.2% 8.3% 100.0%

Santa Clara County Outline

Sunnyvale

Peery Park

Lower Average Wage

Higher Average Wage

Average Wage Per Worker

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Employment Figures

- Employment on the rise across the bay area - 10% growth expected over the next 5 years - 110,000 Jobs over next five years - County employment expected to reach dotcom levels by 2020 - Rapidly expanding job growth drives demand for all candidate land uses

- Sunnyvale is located in one of the highest employer density areas in the San Francisco Bay Area

- Over 430,000 jobs are located within 5-miles of Downtown Sunnyvale

Bay Area Employment Nodes

>430k jobs with 5 Mile Radius

The Heart of Manufacturing

Average 40-50% Manufacturing

Manufacturing %

0-10% 10-20% 20-30% 30-40% 40-50% 50-60% 60-70% > 70%

The area in and around Sunnyvale contains some of the highest density of manufacturing in the Bay Area

Peery Park Employment Mix

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Peery Park Businesses

Growth in technology sector drives demand for technical manufacturing across silicon valley Manufacturing’s share of jobs is rising steadily in Peery Park

56% 60%

20% 32%

Min 44%

Administration & Support Services

Professional Services

Manufacturing

Manufacturing accounts for 56% of all jobs, and 20% of businesses in Peery Park

Changing Industry in Peery Park

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Bioscience Bioscience employment has grown 10% per year since 1990

The industry has grown 10x in last four years

Technical manufacturing industries are taking the place of traditional manufacturing Manufacturing jobs in Peery Park have gained 86% since the recession

--- Businesses Jobs

Peery Park Commercial Building Area Distribution

Sunnyvale Commercial Building Area Distribution

Sunnyvale and Peery Park Product Mix

29% Office

59% Industrial

12% Retail

29% Office

69% Industrial

1% Retail

Total Santa Clara County Office Demand

Office Demand From New

Employment Growth

Office Demand From

Obsolescence

Future Office Demand

• Santa Clara County: 2.5 Million square feet of office demand annually through 2025

• A cumulative 32 Million sf of office demand over the next 13 years with almost 20 million of that coming by 2018.

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Cumulative Office Demand – Santa Clara County

Demand From Obsolescence

Demand From New Job Growth

Peery Park Net New Office Demand

1.88MM SF Office

2.52MM SF Office

Based on fair and consistent share of Santa Clara County job growth and office using employment

34% Growth

645,000 new sqft of office space demanded through 2025

Total Santa Clara County Industrial Demand Industrial

Demand From New

Employment Growth

Industrial Demand From Obsolescence

Future Industrial Space Demand

• Santa Clara County: 1.4 Million s.f. of industrial demand annually through 2025

• A cumulative 18.4 Million square feet of industrial demand over the next 13 years

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Cumulative Industrial Demand - Santa Clara County

Demand From Obsolescence

Demand From New Job Growth

Peery Park Net New Industrial Demand

THERE ARE NEGATIVE INDUSTRIES…. INCLUDE??

4.44MM SF Industrial


Based on fair and consistent share of Santa Clara County job growth and industrial using employment

12% Growth

553,000 new sqft of industrial space demanded through 2025

Peery Park Total Workplace Demand

Total Workplace

Demand

Office Demand

Industrial Demand

1,198k sf

645k SF

553k SF

Peery Park Retail Demand

Average Annual Demand 10,500 sf of Retail Space

Range of Metric-Driven Models Average Total

Retail Space Per Commercial Foot 11,021 143,272

Retail Space Per Employee - Analogues 7,782 101,165

Retail Space Per Employee - Spending Model 6,576 85,490

Retail Sales Per Commercial Foot 15,615 202,994

Neighborhood Retail Sales Per Commercial Foot 11,420 148,457

Spending Gap and Population Growth 10,635 138,249

Average Retail Demand: 10,508 136,604

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Cumulative Retail Demand – Peery Park

Total Cumulative Demand Through 2025

136,600 sf of retail space

Peery Park Net New Retail Demand

85k SF Retail

221k SF Retail

Based on fair and consistent share of Santa Clara County household and retail generating employment growth

160% Growth

136,600 new sqft of retail space demanded through 2025

Current Market Metrics Peery Park Sunnyvale Santa Clara County

Office Market Rentable Area (SF) 1,875,222 12,275,523 106,298,539 % total commercial 29% 29% 28%

Vacancy Rate 6.4% 6.3% 10.4%

Rent ($ft/yr) $35.51 $34.51 $29.31

Industrial Rentable Area (SF) 4,439,589 24,926,847 203,274,386 % total commercial 69% 59% 53%

Vacancy Rate 4.9% 8.0% 9.5%

Rent ($ft/yr) $23.23 $20.66 $14.21

Retail Rentable Area (SF) 85,811 4,897,134 75,964,112 % total commercial 1% 12% 20%

Vacancy Rate 3.9% 3.4% 4.8%

Rent ($ft/yr) $30.00 $30.78 $27.03

Office Leases Low Lease Rate High Lease Rate

Symbols ramped by rentable building area

Industrial Leases Low Lease Rate High Lease Rate


Retail Leases Low Lease Rate High Lease Rate


Development Feasibility

Small Properties Sites less than 1acre

Large Properties Sites over 5 acres

(individual or adjacent and jointly owned)

Medium Properties Sites between 2-5 acres (individual or adjacent

and jointly owned)

Renovation or redevelopment around 0.5 FAR

Development limited by small site size. Renovation more likely than redevelopment

Large sites with high land values mean high project costs. High FAR required to maximize return on investment. Structured parking necessary.

Site size enables larger development. Higher land costs suggest higher FAR and some structured parking

Most likely to redevelop at

0.5 to 1.0 FAR

Most likely to redevelop at 1.0 FAR or higher if permitted

Where can we anticipate change

occurring?

Mostly Stable & Unlikely to Change

Renovated or well maintained

Buildings receiving high rents New Construction

Stable residential neighborhoods

Disinvested &/or Ready for Change

Vacant Land

Small Building &/or Low Site Coverage Vacant &/or Low Value Buildings

Market Demand & Feasibility 1.875MM SF

Office

2.52MM SF Office



85k SF Industrial

221k SF Retail

Shorter Term Potential

Medium Term Potential

Long Term Potential

Market Driven Potential

Preliminary Potential for

Change

Major Silicon Valley Organizations

Downtown

Transit Stations

Freeway Access & Visibility

Moffett Field Airport Comprehensive Land Use

Plan

Density Restrictions

Height Restrictions

Value Generating

Assets

Ownership Restrictions

Greatest Opportunities • Large parcels with

high visibility

• Adjacent properties under single ownership near major tenants

• Clusters of large, vacant or highly underutilized properties

Change Areas Shorter Term Restructuring

Medium Term Transition

Longer Term Transition

Strengthen & Support

Preliminary Peery Park Planning

Program

Broad Brush Strategic Framework

Transform Peery Park into a cutting-edge workplace district that attracts and accommodates innovation driven businesses and workers.

The City’s Goal

• Potential for Change

• Existing Conditions

• Market Demand

• Feasible Development Types

1) Don’t Use a One-Size-Fits-All

Approach

Workplace Activity

• Evenly distributed lunchtime activity

• One or two major after work centers

Prominent Public Spaces

2) Strategically Target Areas for Increased

Activity

3) Foster a Dynamic Mix of Uses: Move beyond simple

“Office” & “Industrial” Categories

THINKING PHYSICAL PRODUCTION

Service Software Research & Development

(R&D)

Design & Engineering

(D&E)

Component Production

Product Assembly

from Components

50% of businesses

33% of businesses

50% of businesses

24%

42%

8%

2%

3%

9%

12% Professional, Scientific, and TechnicalServices

Manufacturing

Administration & Support, WasteManagement and Remediation

Health Care and Social Assistance

Public Administration

Wholesale Trade

Other

Existing Peery Park Industry Breakdown: By Employment

3A) Foster a Dynamic Mix: Maintain a Mix of Thinking and Production

3B) Foster a Dynamic Mix: Build on Existing Industry

Clusters

• Production

Medical, transistors/ integrated chips/ components, electronics

• Thinking

Consumer product design, Software, Network and Internet Services


• Smaller Scale Design, Engineering, & Production

• Larger Scale Research, Design, & Services

• Retain Businesses as Their Space & Facilities Needs Change Over Time

3C) Foster a Dynamic Mix: Incentivize a Mix of Spaces to

Accommodate a Variety of Work Activity


• Larger Scale Research, Design, & Services

3C) A Dynamic Mix: High Profile

“Thinking” Firms

3C) A Dynamic Mix: Small Scale

“Production” Cores

• Smaller Scale Design, Engineering, & Production

A Connected Network of Streetscapes, Plazas, etc:

• District Image

• Walkability

• Meeting, Relaxing, Idea Exchange, etc.

• Street Activity

4) Improve the Public Space Network

• District Wide TDM and transit plan

• Build off of transit along Mathilda

• Improve pedestrian/ bike connections within the district

• District parking programs, or shared parking structures.

5) Manage Parking & Mobility

• Housing in limited locations

• Height and/or setback restrictions on buildings adjacent to or visible from existing neighborhoods

6) Sensitive Transitions to Adjacent

Neighborhoods

Innovation Anchors • District Organization • Startup School • Higher Education Institutions

Expand & Tap Into Specialized Local Knowledge • Architecture and Public Space Design • District Idea Sharing & Networking Portal

Curate & Support the Innovation Process • Industry Specific Infrastructure as a Services

7) Make the District a Knowledge Center

Tonight’s Agenda

Open House

Presentation

• District History & Workplace Trends

• Market Analysis & Development Feasibility

• Urban Design Strategy and Actions

Q & A

Comment Exercise

Comment Review

Open House

6:30pm – 7pm

7pm – 7:45pm

7:45pm – 8pm

8pm – 8:30pm

8:30pm-8:45pm

8:45pm – 9pm


Broad Brush Urban Design Framework

sunnyvale peery park presentation

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