The San Jose Commercial Real Estate Market

Shanti Ryle

February 21, 2025

San Jose's downtown business district during a pink-colored sunset

San Jose’s diverse market is a magnet for investors and tenants alike, poised to adapt to shifting economic conditions while continuing to offer exceptional opportunities for positive returns on capital and business investment.

Crexi offers property seekers fast and easy access to investment-grade assets in the region and everything needed to close a deal quickly for those looking into San Jose real estate.

Brokers with San Jose commercial property use Crexi's robust listing marketing tools to guide deals from list to close. To date, Crexi's CRE technology has helped brokers close over $615 billion in property value and market over $7 trillion in assets.

Crexi proudly supports San Jose, Mountain View, Los Gatos, Campbell, Palo Alto, and the surrounding communities as the nation's fastest-growing commercial real estate platform.

Nearby mountains to San Jose are in the background and frame the city with orange poppies in the foreground

The State of San Jose Commercial Real Estate

San Jose continues to solidify its reputation as the vibrant heart of Silicon Valley, where strong economic fundamentals and tech innovation fuel a dynamic commercial real estate market. As the main component of the San Jose–Sunnyvale–Santa Clara Metropolitan Statistical Area, the region offers a blend of urban living and innovative tech culture, making it an attractive destination for residents and businesses.

Economically, the metropolitan area is a powerhouse, home to numerous high-tech and electronics companies. It's a flourishing business hub, attracting entrepreneurs, tech enthusiasts, and job seekers from across the globe. The robust economy and diverse job market make it an ideal place for career growth and development. Additionally, the area is known for its high-quality education system, with top-rated schools and universities that attract talented students worldwide.

Apart from its economy, San Jose and its surrounding areas offer a rich tapestry of cultural, recreational, and entertainment opportunities. There's something for everyone, from the Tech Museum of Innovation to the historic downtown district. The region's natural beauty, characterized by the Santa Clara Valley and scenic Coyote Creek, provides ample outdoor activities and exploration opportunities.

Whether you're a business looking to tap into the Silicon Valley tech scene or an individual seeking a thriving, opportunity-filled place to live, San Jose and its surrounding areas have much to offer.

San Jose Regional Breakdown

San Jose, the crown jewel of Santa Clara County, boasts a diverse and educated population, most of whom hold a bachelor's degree or higher. This level of education is considerably above the average in California and the US. The population spectrum is broad, with residents enjoying a high per capita income significantly above the state and national average.

Additionally, the median household income is impressive, emphasizing the area's prosperous economic conditions.

The metropolitan area is home to close to 1.8 million million, nearly 1 million of whom reside in the city of San Jose.
Santa Clara County includes the cities of Campbell, Cupertino, Gilroy, Los Gatos, Mountain View, Palo Alto, and Sunnyvale.
Over 57% of the residents of the San Jose metro area hold a bachelor’s degree or higher, about 1.5 times the rate in California and the US.
The median age is 37.8, with 43% of the population between 20 and 49.
Per capita income is $63,253.
Median household income is $160,747 (more than twice the amount in the US).
Median household incomes increased by over 9.6% between 2021 and 2022, according to Data USA.

The interior of an office building bullpen in San Jose, looking out on to the city through its windows

San Jose Job Market

San Jose's economy is a vibrant mix of technology, software production, and internet-related businesses, powering its impressive GDP growth over the past two decades.

The city is a hub for tech giants that have led to San Jose being ranked highly for STEM jobs and overall job prospects, supported by a solid educational foundation from institutions like Stanford University, UC Berkeley, and San Jose State University. With 1 in 5 San Jose residents holding degrees in STEM (Science, Technology, Engineering and Math) fields, it’s no wonder that so many of the world’s leading innovators have flocked to the region.

GDP for the San Jose-Sunnyvale-Santa Clara MSA is over $422.8 billion, according to the most recent data from the Federal Reserve.
Over the past 20 years total gross domestic product has soared by over 250%.
The unemployment rate is 3.9% (December 2024 BLS).
Computer hardware design and manufacturing, software production, and internet-related businesses are some of the area's major business sectors.
The city is a thriving economic hub, home to more than 200 high-tech firms and renowned names such as Adobe, Zoom, Oracle, Ernst & Young, and others.
The San Jose metro area is home to over 6,600 tech companies, including Adobe, Brocade, Netflix, eBay, TiVo, Apple, Google, Facebook, LinkedIn, and Intel.
WalletHub ranks San Jose as the 8th best city for STEM jobs, while the San Jose Office of Economic Development and Cultural Affairs states that the city has more MBA jobs per capita than any other U.S. city.
Top colleges and universities include Stanford University, University of California, Berkeley, and San Jose State University.

The region’s transportation infrastructure is a complex multimodal system that includes the Mineta San Jose International Airport (SJC), major highways like US Route 101 and Interstate 280, and a robust public transit system.

The side of an industrial building in San Jose decorated with graffiti

San Jose Industrial Market

Through the end of 2024, San Jose’s industrial market was shaped by a balance of positive and negative trends. While growing job counts and strong venture capital funding highlight the city’s strong economic momentum, risking asking rates point to ongoing demand for quality industrial space. At the same time, modest increases in overall vacancy and deeper net absorption losses underscore some of the ongoing struggles in tenant retention.

Even so, growing needs from e-commerce and life science sectors are expected to continue to support the industrial market, despite potential economic uncertainties.

Market overview (Cushman & Wakefield Q4 2024)

Inventory: 120,810,656 SF
Vacancy rate: 4.9%
Absorption: -266,061 SF (YTD)
Key leases by tenant: Valassis Communications (161,280 SF), California Wine Transport (92,303 SF), AC Wholesale Foods (65,082 SF), Minghua (64,396 SF)
Under construction: 1,735,522 SF
Largest submarkets: South San Jose, Fremont, North San Jose, Santa Clara

Crexi Insights

These are the most recent industrial lease and sales trends from Crexi Insights (as of February 2025):

For Lease (active)

Asking rate/SqFt (median): $21 per year
Median SqFt/listing: 3,790
Days on market: 149
Total listings on Crexi: 117 spaces

For Sale (active)

Median asking price: $2.5 million
Price/SqFt: $414
Asking cap rate: 4.5%
Days on market: 140
Total listings on Crexi: 33 listings for a total of 1.3 million SF

Sales Comps (past 12 months)

Median sold price: $2.6 million
Sold price/SqFt: $388
Total sales volume: $336.6 million
Median SqFt sold/transaction: 8,160
Total SqFt sold: 948.4K
Days on market (median): 221

Find San Jose industrial space for rent.

Apple's famous Cupertino Apple Loop office is near San Jose

San Jose Office Market

The San Jose office market has shown signs of recovery with a significant rebound in net absorption and decreasing vacancy rates. Job growth may have helped to balance the increased interest in office space optimization, and even as an increasing number of companies look to smaller, more efficient workspaces, strong performance in key submarkets proves there is a continued demand for quality office space.

Although overall vacancy levels remain elevated, there are signs that the market is slowly moving towards a more balanced state.

Market overview (Cushman & Wakefield Q4 2024)

Inventory: 94,347,340 SF
Vacancy rate: 22.5%
Absorption: 2,589,792 SF (YTD)
Key leases by tenant: Snowflake (772,976 SF), Amazon (217,754 SF and 181,562 SF), Robinhood (126,000 SF) and Ericsson (53,548 SF)
Under construction: 261,579 SF
Largest submarkets: Sunnyvale, Santa Clara, Downtown San Jose

Crexi Insights

For the latest insights into Pittsburgh's office market, turn to Crexi. Here are the real-time office leasing and sales trends as of February 2025:

For Lease (active)

Asking rate/SqFt (median): $18 per year
Median SqFt/listing: 1,821 SF
Days on market: 273
Total listings on Crexi: 446 spaces

For Sale (active)

Median asking price: $725,000
Price/SqFt: $83
Asking cap rate: 5.3%
Days on market: 222
Total listings on Crexi: 70 listings totaling 1.5 million SF

Sales Comps (past 12 months)

Median sold price: $397,500
Sold price/SqFt: $164
Total sales volume: $19.8 million
Median SqFt sold/transaction: 3,310 SF
Days on market (median): 161

Find San Jose office space for rent.

San Jose Retail Market

The retail market in San Jose is getting a new lease on life, fueled by Silicon Valley’s strong economic fundamentals and rising incomes that help boost consumer spending. Job growth has stayed steady and the area has reached its lowest overall vacancy rate in several years, signaling renewed confidence in the market. New construction is holding steady, and strong investment sales and transaction volumes are signs of an encouraging recovery.

Market overview (Cushman & Wakefield Q4 2024)

Inventory: 37,567,184 SF
Rent growth: 0.6% (last 12 months)
Vacancy rate: 4.8%
Absorption: 199,026 SF (12 month net)
Key leases by tenant: Direct Factory Furniture (24,500 SF), Ross Dress for Less (23,600 SF), Club Studio (18,000 SF), Construction Industry (4,900 SF)
Under construction: 166,058 SF
Largest submarkets: San Jose(Downtown/South)/Campbell/Los Gatos, Milpitas/North San Jose, Sunnyvale/Cupertino

Crexi Insights

Retail lease and sales trends from Crexi Insights (as of February 2025):

For Lease (active)

Asking rate/SqFt (median): $30 per year
Median SqFt/listing: 1,748 SF
Days on market: 460
Total listings on Crexi: 200 spaces

For Sale (active)

Median asking price: $899,000
Price/SqFt: $550
Asking cap rate: 5.4%
Days on market: 273
Total listings on Crexi: 51 listings for a total of 489,700 SF

Sales Comps (past 12 months)

Median sold price: $923,300n
Sold price/SqFt: $332
Total sales volume: $3.3 billion
Sold cap rate: 5.2%
Median SqFt sold/transaction: 3,479 SF
Days on market (median): 289

Find San Jose retail space for rent.

A valley with San Jose single family and multifamily homes nestled in the background

San Jose Multifamily Market

San Jose’s multifamily market continues to stand resilient amid a combination of cautious leasing activity and high housing demand. Despite some economic uncertainty, the limited pace of new deliveries has helped keep vacancy rates impressively low. As rising housing costs push more households towards renting, ongoing construction in active submarkets like Downtown San Jose, Santa Clara, Sunnyvale, and Mountain View ensures steady supply.