Excellent presentation on the changing nature of workplaces from the people who brought you downtown Mountain View

1. PEERY PARK SPECIFIC PLAN & EIR
Community Workshop #1
Existing Conditions & Workplace Trends,
Market Analysis,
Broad Brush Strategic Framework
© 2012 Freedman Tung + Sasaki - except outside sourced material
City of Sunnyvale
October 16, 2013
www.ftscities.com

2. Tonight’s Agenda
6:30pm – 7pm
7pm – 7:45pm
7:45pm – 8pm
8pm – 8:30pm
8:30pm-8:45pm
8:45pm – 9pm
Open House
Presentation
• District History & Workplace Trends
• Market Analysis & Development Feasibility
• Urban Design Strategy and Actions
Q&A
Comment Exercise
Comment Review
Open House

3. City Staff Reviews &
Guides Everything
Urban Design, District Strategy,
Land Use & Development Regulations
Environmental Impact Analysis
Circulation and Access
Market Analysis & Feasibility
Fiscal Analysis

4. 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

5. A Specific Plan is the
community’s most powerful tool
to guide change directly
to “make a better city”

6. The Specific Plan
1. Community Intent
2. Development Regulations
3. Planned City Actions

7. The Specific Plan
1. Community Intent
The Envisioned Future District
District Planning Strategy
2. Development Regulations
3. Planned City Actions

8. Our Task:
Recommendation
to the City Council
Vision for the future of
Peery Park.

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

10. Early 20th Century:
“Industry” Reorganized Around Assembly Lines
• Synchronized
• Low skill
• Organized by
component tasks
• Mass production

11. Economy = Making & Moving Goods:
Cities re-organized using
Industrial Principles
Business park
Shopping Center
City as Machine (CIAM 1933)
Housing Subdivision
© Freedman Tung + Sasaki 2012

12. Sunnyvale’s First General Plan: 1954-57
City
Neighborhoods
Industrial Areas

13. The Advent of
Suburbia:
1950 - 1970
Sunnyvale’s
population grew
almost 500%
Image: LIFE Magazine

14. 1981 LUTE
Roughly 80% of
Peery Park built out
between 1960 and
1990

15. Sunnyvale’s First
General Plan: 1954-57
Housing and Workplace
in Sunnyvale Today
Housing
Workplace

16. The Experiment FIT with the
industrial economy of the Era.
Business park
Shopping Center
Housing Subdivision
© Freedman Tung + Sasaki 2012

17. Existing Pattern
of Development
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

18. Existing Ground
Floor Land Use

19. Older Development
• Low-rise
• High lot coverage
• Smaller footprint
Existing
Development
Pattern
Newer Development
• Multi-story
• Conventional office
park configurations
with low lot coverage
• Larger floorplates

20. Streetscapes and Setbacks
Older Development
• Shallower landscaped setbacks
• Entrances oriented to the street
• Truck Loading
Newer Development
• Conventional office park buildings
• Deeper setbacks with surface parking
• Entrances oriented to parking

21. Existing
sidewalks
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

22. Existing
Development
Pattern
• Mathilda Corridor
• Older
Development
• Newer
Development
• Limited public
gathering spaces
& amenity

23. 2011 General Plan:
Potential Growth
Areas

24. Does the 20th Century approach
to city-building FIT with the
economy built by Silicon Valley?
Business park
Shopping Center
Housing Subdivision
© Freedman Tung + Sasaki 2012

25. …the Story of the
Economy Built by
Silicon Valley…

26. The Origin of 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

27. Silicon Valley’s Success:
Accumulation of Local Skills & Unique Knowledge
• 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)

28. The Nature of Work
has Changed

29. 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

30. This process is called Innovation and it has
become the primary wealth-generator
in the new economy.
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31. Innovation is a social process
• Group
collaboration
• Different
specializations,
skills,
experiences, and
perspectives.
Source: analytics20.org

32. Essential Principle: Innovation requires
settings that bring people together
to collaborate and exchange ideas
• In the office and the lab
• In the conference room
• In cafes, bars and
restaurants
• During breaks, recreation
and leisure
• Especially while socializing

33. Saskia Sassen:
These trends are not just about
software and design, but also about
mining and agricultural industries,
all industries.
© Freedman Tung + Sasaki 2012

34. Changes are Already
Underway INSIDE
the Workplace

35. Changes INSIDE the Workplace:
New
Work Processes
New
New
Offices Layouts Workspace Formats
GOOGLE
AMENITY
Decentralization & skilled labor
i.e: Pixar, 3M, Google,
Amazon, Facebook
Co-working spaces, work cafes,
“Hacker villages”…

36. But Changes INSIDE
the Workplace are not
Enough

37. Because 20th Century CBDs and Business Parks…
Low Density and Auto Oriented
Landscaping but no “Public” Space
No activity centers
Inward focus hides activity
…no longer fit the needs of the innovation economy

38. 1981 LUTE
Roughly 80% of
Peery Park built out
between 1960 and
1990
Before the internet,
smartphones, etc.

39. Workplace districts
must be physically re-shaped
to survive in the innovation economy

40. Reshape the District:
Dynamic Mix of Uses

41. The Workplace District remains out of sync
Segregated by type of work
(office, R+D, manufacturing)
with little variation

42. Innovation Ecosystem:
Companies at
Different Stages in their Lifecycle
Dense Collaborative Network of
Partners, Suppliers, Customers

43. Range of Building & Workspace Types
Quality Medium Sized Space
Creative rehab – lower cost spaces
New lower cost, small scale space
Established Corporate Space

44. Tenant Mix with a Single Building or Complex
© Freedman Tung + Sasaki 2012
Source: 5M/Forest City

45. Reshape the District:
Activity

46. The Workplace District remains out of sync
No activity focus or center

47. Retail is Critical to Activity.
Where (and how) to build retail is a central strategic decision.

48. 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

49. Reshape the District:
Amenity & Image

50. The Workplace District remains out of sync
Plenty of Open Space but no “Public” Space

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

52. BBC Sport
production
activity
Public
studio
viewing
room
Settings for Interaction & Activity
“Dense Clustering” of
People, Skills, & Ideas
Connectivity +
Amenity
Strategically Located
Activity Generating Retail
Ideas on Display

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

54. 20th Century:
Economic Value
Created by Large Firms
Economic Development
Attract Large Firms

55. Change#1: The scale & complexity of business
operations has increased dramatically
Wrigley
© Freedman Tung + Sasaki 2012

56. Change #2: Work is distributed among a
highly connected network of
specialized, collaborating partners,
and service providers

57. Change #3: There has been sharp
growth in producer services
Series1
1980
Series2
1990
Series3
2000
Series4
2008
To service the more
complex business
ecosystem.
60,000
50,000
40,000
30,000
20,000
10,000
0
SERVICES:
Community, Social
and Personal
SERVICES:
Financing, Insurance,
Real Estate, & Business
CONSUMPTION:
Wholesale / Retail Trade,
Restaurants, & Hotels
CONSUMPTION:
Construction
PRODUCTION:
Manufacturing
PRODUCTION:
Agriculture,
Mining, & Utilities
Source: Sassen – Cities in a World Economy (2012)
•
•
•
•
•
•
Advertising
Consulting
Accounting
Design
Engineering
Software

58. The Majority of Producer Services are
Small & Medium Sized Firms
Firm Size
1 to 9
100 to
10 to 99 499
Over
500
All firms
Manufacturing Firms
Professional, Scientific, Technical,
and Other Services Firms
48%
49%
20%
32%
5%
7%
17%
11%
75%
16%
2%
7%
All employment
Manufacturing Employment
11%
5%
24%
22%
14%
18%
51%
55%
Professional, Scientific, Technical,
and Other Services Employment
24%
34%
13%
29%

59. 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?

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

61. The Critical Role of Small Firms &
Start-Ups in the Innovation Process
Over 100 including:
Android, Picasa,
Frommers, Zagat
Over 30 including:
Instagram
Over 40 including:
Siri
Large firms innovate by purchasing small firms &
integrating innovative components

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

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

64. Innovative Firms Locate Near Talent Pools
Transit
Streetlife
Public Spaces
The “creative class” craves vital centers
The same characteristics that drive innovation & sustainability

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

66. Make the District A
“Knowledge Center”
Innovation Anchors: “Institutions” that actively
facilitate collaboration and knowledge exchange

67. How much and
what type of
development can we
anticipate?

68. The Concord Group
Market Context, Demand, and Feasibility

69. Key Area Summary
Peery Park
Average Wage Per Worker
Sunnyvale
Santa Clara
County Outline
Geography
Population ('13)
Share of County
Employment (2013)
Share of County
Peery
Park
Sunnyvale
1,937
143,714
0.1%
7.8%
10,605
76,247
1.2%
8.3%
Santa
Clara
County
1,843,474
-914,710
100.0%
Lower Average Wage
Higher Average Wage

70. Employment Figures
1,200
1,000
800
600
400
200
0
1995
-
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
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

71. Bay Area
Employment
Nodes
>430k jobs with
5 Mile Radius
- 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

72. The Heart of Manufacturing
Average 40-50%
Manufacturing
Manufacturing %
The area in and around
Sunnyvale contains some
of the highest density of
manufacturing in the Bay
Area
0-10%
10-20%
20-30%
30-40%
40-50%
50-60%
60-70%
> 70%

73. Peery Park Employment Mix
Manufacturing accounts for
56% of all jobs, and 20% of
businesses in Peery Park
Peery Park Businesses
450
400
350
300
Professional Services
250
200
150
100
20%
32%
50
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
00
Growth in technology
sector drives demand for
technical manufacturing
across silicon valley
14,000
Manufacturing
Administration & Support
Services
Peery Park Jobs
12,000
10,000
8,000
6,000
4,000
2,000
60%
56%
Min 44%
00
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Manufacturing’s share of
jobs is rising steadily in
Peery Park

74. Changing Industry in Peery Park
Technical manufacturing
industries are taking the
place of traditional
manufacturing
Manufacturing jobs in
Peery Park have gained
86% since the recession
12,000
--- Businesses
Jobs
Manufacturing
160
140
10,000
120
8,000
100
6,000
80
60
4,000
40
2,000
20
00
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
00
3,000
Bioscience
2,500
2,000
1,500
1,000
500
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
00
45
40
35
30
25
20
15
10
05
00
Bioscience
employment has
grown 10% per year
since 1990
The industry has
grown 10x in last four
years

75. Sunnyvale and Peery Park Product Mix
Sunnyvale Commercial Building Area
Distribution
12% Retail
Peery Park Commercial Building Area
Distribution
1% Retail
29% Office
29% Office
59% Industrial
69% Industrial

76. Total Santa Clara County Office Demand
Office Demand
From New
Employment
Growth
Cumulative Office Demand – Santa Clara County
35,000
Demand From Obsolescence
30,000
Demand From New Job Growth
25,000
Office Demand
From
Obsolescence
20,000
15,000
10,000
5,000
Future Office
Demand
0
2013
2014 2015 2016
2017
2018 2019 2020 2021 2022 2023 2024 2025
• 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.

77. Peery Park Net New Office Demand
645,000 new sqft of office
space demanded through 2025
1.88MM SF
Office
2.52MM SF
Office
34% Growth
Based on fair and consistent share of
Santa Clara County job growth and office using employment

78. Total Santa Clara County Industrial Demand
Industrial
Demand From
New
Employment
Growth
Cumulative Industrial Demand - Santa Clara County
20,000
18,000
16,000
Industrial
Demand From
Obsolescence
Demand From Obsolescence
Demand From New Job Growth
14,000
12,000
10,000
8,000
6,000
4,000
Future Industrial
Space Demand
2,000
0
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
• 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

79. Peery Park Net New Industrial Demand
553,000 new sqft of industrial
space demanded through 2025
4.44MM SF
Industrial
4.99MM SF
Industrial
12% Growth
Based on fair and consistent share of
Santa Clara County job growth and industrial using employment

80. Peery Park Total Workplace Demand
Office
Demand
645k SF
Industrial
Demand
553k SF
Total
Workplace
Demand
1,198k sf

81. Peery Park Retail Demand
Range of Metric-Driven Models
Retail Space Per Commercial Foot
Average
11,021
Total
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
10,508
136,604
Average Retail Demand:
Average Annual
Demand
10,500 sf of Retail
Space
Cumulative Retail Demand – Peery Park
Total Cumulative
Demand Through 2025
136,600 sf of retail
space
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025

82. Peery Park Net New Retail Demand
136,600 new sqft of retail space
demanded through 2025
85k SF
Retail
221k SF
Retail
160% Growth
Based on fair and consistent share of
Santa Clara County household and retail generating employment growth

83. Current Market Metrics
Peery Park
Sunnyvale
Santa Clara County
1,875,222
29%
12,275,523
29%
106,298,539
28%
Vacancy Rate
6.4%
6.3%
10.4%
Rent ($ft/yr)
$35.51
$34.51
$29.31
4,439,589
69%
24,926,847
59%
203,274,386
53%
Vacancy Rate
4.9%
8.0%
9.5%
Rent ($ft/yr)
$23.23
$20.66
$14.21
85,811
1%
4,897,134
12%
75,964,112
20%
Vacancy Rate
3.9%
3.4%
4.8%
Rent ($ft/yr)
$30.00
$30.78
$27.03
Office Market
Rentable Area (SF)
% total commercial
Industrial
Rentable Area (SF)
% total commercial
Retail
Rentable Area (SF)
% total commercial

84. Office Leases
Low Lease Rate
High Lease Rate
Symbols ramped by rentable building area

85. Industrial Leases
Low Lease Rate
High Lease Rate
Symbols ramped by rentable building area

86. Retail Leases
Low Lease Rate
High Lease Rate
Symbols ramped by rentable building area

87. Development Feasibility
Small Properties
Sites less than 1acre
Development
limited by small
site size.
Renovation more
likely than
redevelopment
Renovation or
redevelopment
around 0.5 FAR
Medium Properties
Sites between 2-5 acres
(individual or adjacent
and jointly owned)
Large Properties
Sites over 5 acres
(individual or adjacent
and jointly owned)
Site size enables larger
development.
Large sites with high
land values mean high
project costs.
Higher land costs
suggest higher FAR
and some structured
parking
Most likely to
redevelop at
0.5 to 1.0 FAR
High FAR required to
maximize return on
investment. Structured
parking necessary.
Most likely to
redevelop at 1.0 FAR
or higher if permitted

88. Where can we
anticipate change
occurring?

89. Mostly Stable & Unlikely to Change
Stable residential neighborhoods
New Construction
Renovated or well maintained
Buildings receiving high rents

90. Disinvested &/or Ready for Change
Vacant &/or Low Value Buildings
Small Building &/or Low Site Coverage
Vacant Land

91. Market Demand & Feasibility
1.875MM SF
Office
4.439MM SF
Industrial
85k SF
Industrial
2.52MM SF
Office
4.991MM SF
Industrial
221k SF
Retail

92. Preliminary
Potential for
Change
Shorter Term Potential
Medium Term Potential
Long Term Potential
Market Driven Potential
Value
Generating
Assets
Major Silicon Valley
Organizations
Downtown
Ownership
Restrictions
Moffett Field Airport
Comprehensive Land Use
Plan
Transit Stations
Density Restrictions
Freeway Access &
Visibility
Height Restrictions

93. Greatest Opportunities
• Large parcels with
high visibility
• Adjacent properties
under single
ownership near major
tenants
• Clusters of large,
vacant or highly
underutilized
properties

94. Change Areas
Shorter Term Restructuring
Medium Term Transition
Longer Term Transition
Strengthen & Support

95. Preliminary
Peery Park Planning
Program

96. Broad Brush
Strategic Framework

97. The City’s Goal
Transform Peery Park into a
cutting-edge workplace district that
attracts and accommodates innovation
driven businesses and workers.

98. 1) Don’t Use a
One-Size-Fits-All
Approach
•
•
•
•
Potential for Change
Existing Conditions
Market Demand
Feasible
Development Types

99. 2) Strategically Target
Areas for Increased
Activity
Workplace Activity
• Evenly distributed
lunchtime activity
• One or two major
after work centers
Prominent Public
Spaces

100. 3) Foster a Dynamic Mix of Uses:
Move beyond simple
“Office” & “Industrial” Categories
Service
THINKING
PHYSICAL PRODUCTION
Software
Research &
Design & Component
Product
Development Engineering Production
Assembly
(R&D)
(D&E)
from
Components
50% of
businesses
33% of
businesses
50% of
businesses

101. 3A) Foster a Dynamic Mix:
Maintain a Mix of Thinking and Production
Professional, Scientific, and Technical
Services
12%
24%
Manufacturing
9%
Administration & Support, Waste
Management and Remediation
3%
Health Care and Social Assistance
2%
8%
Public Administration
Wholesale Trade
42%
Other
Existing Peery Park Industry Breakdown: By Employment

102. Existing Pattern
of Development
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

103. Existing Pattern
of Development
3C) Foster a Dynamic Mix:
Incentivize a Mix of Spaces to
Accommodate a Variety of
Work Activity
• Smaller Scale Design,
Engineering, &
Production
• Larger Scale Research,
Design, & Services
• Retain Businesses as
Their Space & Facilities
Needs Change Over Time

104. 3C) A Dynamic Mix:
High Profile
“Thinking” Firms
• Larger Scale
Research, Design,
& Services

105. 3C) A Dynamic Mix:
Small Scale
“Production” Cores
• Smaller Scale
Design,
Engineering, &
Production

106. 4) Improve the
Public Space Network
A Connected Network
of Streetscapes,
Plazas, etc:
• District Image
• Walkability
• Meeting, Relaxing,
Idea Exchange, etc.
• Street Activity

107. 5) Manage
Parking & Mobility
• 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.

108. 6) Sensitive Transitions
to Adjacent
Neighborhoods
• Housing in limited
locations
• Height and/or
setback restrictions
on buildings
adjacent to or visible
from existing
neighborhoods

109. 7) Make the District a Knowledge Center
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

110. Tonight’s Agenda
6:30pm – 7pm
7pm – 7:45pm
7:45pm – 8pm
8pm – 8:30pm
8:30pm-8:45pm
8:45pm – 9pm
Open House
Presentation
• District History & Workplace Trends
• Market Analysis & Development Feasibility
• Urban Design Strategy and Actions
Q&A
Comment Exercise
Comment Review
Open House

111. Existing
Pattern of Development
Broad Brush
Urban Design Framework