Flextronics to move 500 jobs to San Jose, as demand heats up

Flextronics USA disclosed Wednesday that it will move 500 workers and its U.S. headquarters to San Jose, an indication that the surge of tech expansions has begun to widen. Tech giants have gobbled up just about every large office in Palo Alto, Mountain View, Sunnyvale and Cupertino. Now the push is moving beyond those Silicon Valley hubs. “A wave of activity is coming into North San Jose and Santa Clara,” said Phil Mahoney, an executive vice president with Cornish & Carey.

Flextronics leased 140,000 square feet in America Center, a two-building office complex perched alongside Highway 237 near Great America Parkway. The Singapore-based manufacturer and assembler of electronics products is moving its U.S. headquarters to America Center from Milpitas, according to brokers from Cornish & Carey and Cassidy Turley, which arranged the deal. America Center is the same office complex in which Polycom struck a deal in August to rent 214,000 square feet, filling the entirety of one of the two buildings. Together, the Polycom and Flextronics deals are bringing at least 1,100 and as many as 1,200 jobs to San Jose, once Polycom fills up all the space it leased. Other deals are landing in Santa Clara, brokers pointed out.

Last year, Dell leased 240,000 square feet a short distance away in Santa Clara, where the computer maker has coalesced multiple operations into a research-and-development center. In November, Avaya revealed its decision to lease 275,000 square feet in Santa Clara.  “We’re seeing an overflow of activity from Palo Alto, Mountain View and Sunnyvale,” said Randy Gabrielson, a Cornish & Carey executive vice president. Some firms that moved to Sunnyvale have already begun to expand there, such as Rambus and Motorola.

Industry watchers predict that the heated push to expand into San Jose and Santa Clara — along with efforts to scour Cupertino, Sunnyvale, Mountain View and Palo Alto for any overlooked office nooks — won’t cool off soon. Flextronics said it expects to be in its new offices in San Jose by summer. The company will keep its local manufacturing in Milpitas. “It is a cost-effective move for the company,” said Flextronics spokeswoman Renee Brotherton.

North San Jose has some large blocks of space and vacant parcels where companies can gain plenty of elbow room. City officials, though, say they are helping to enhance the space availability. “We have put policies in place that have been helpful with the corporate expansions,” San Jose Mayor Chuck Reed said. “We have housing under construction, about 3,000 units. Companies will have close housing access for their workers.” The city also has attempted to slash red tape for development.

“We have streamlined the permit process enormously,” Reed said. “Markets are moving fast, and companies have to be ready for that.”