Amid a challenging rate environment, a loan refinancing deal made for a tech center in Fremont could point to a new lender of choice for real estate debt borrowers.

Commercial mortgage banking firm Gantry secured a $17.3 million permanent loan from an insurance company to refinance the Bayside Tech Center, a 86,000-square-foot, two-building complex in Fremont. The lending source has gained popularity for its stable cost of funds and certainty of execution, observers say.

Redwood City-based real estate investor Dollinger Properties bought the pair of buildings at 47281 and 47361 Bayside Parkway in 2017 for $15.1 million, and later took out a CMBS loan in 2018 for $11 million, property records on file with the Alameda County Assessor’s Office show.

The loan was set to expire in 2028, but after one of its tenants signed a long term lease extension there at a much higher monthly rental rate, unlocking built-in equity, the property owner opted to refinance its loan.

Gantry Principal Tony Kaufmann, and Associates Alex Poulos and Joe Foley, represented the borrower. Kaufmann told the Business Times the new loan came from one of Gantry’s life company correspondent lenders and features an initial lockout period followed by flexible prepayment options through the remainder of the loan.

The initial loan had an interest rate of 4.89%, and the new loan landed in the mid-fives, Kaufmann said. To hash out the deal, the borrower had to pay off the CMBS loan, which included a prepayment penalty fee. Since the rate of the loan was lower, the prepayment penalty was too.

“It made sense, just with where the prepayment penalty was, to kind of take a slightly higher rate for a large kind of recapture of their equity right in the deal,” Kaufmann said.

Most of the banking sector has stopped or slowed its lending because of the decrease in liquidity in the market. At the same time, insurance companies, because of their different costs of capital and how their business model works, have remained extremely active in the market.

“Insurance companies have really been the belle of the ball for the last three years, while the banks have retreated significantly,” Kaufmann said.

While they offer benefits like certainty of execution, insurance loans make up roughly 13% of all commercial real estate debt. Despite the reduced borrowing appetite due to the disparity in rate increases and cap rates, Kaufmann is sensing a change in borrower behavior.

“You’re starting to see more people come off the fence and borrow, because either the general expectation is we’re in a new environment,” Kaufmann said.

The popular saying “an army marches on its stomach” could be credited to Frederick the Great or Napoleon Bonaparte, but the adage also applies to the legions of Silicon Valley tech workers. An army of industrious Bay Area innovators and worker bees needs to be well-supplied with food and other necessities to be effective.

Silicon Valley is home to a range of dining options. The pandemic was harsh on many owners and general managers while creating opportunities for others. Here’s an overview of restaurants and dining establishments planning to open in 2025, with some we lost in 2024.

San Jose

Adega: San Jose’s only Michelin-starred restaurant reopened in October after closing in December 2023. Serving Portuguese cuisine, owners Carlos and Fernanda Carreira had planned to turn the 1614 Alum Rock Ave. location into a second location for their Petiscos restaurant but had a most welcome change of heart.

Augustine: The Bacchus Management Group’s second restaurant in Santana Row will offer Mediterranean cuisine in two dining rooms across 8,000 square feet as well as a 3,000-square-foot patio space. The site, formerly a dim sum restaurant, will also have a reservations-only cocktail bar.

Campus Burgers: Home of the $2 smash burger, this family-run burger stand opened in July offering students and locals an inexpensive alternative to the larger chains. Located across the street from San Jose State University at 108 Paseo de San Antonio, this little burger joint has become a student staple.

California Fish Grill: Coming soon to the Evergreen Circle shopping center at 2394 Evergreen Place, this will make three Silicon Valley locations of the healthy fast-food chain.

Caminos de Michoacán: Offering up authentic Mexican cuisine like goat birria tacos, menudo and enchiladas michoacanas at 5138 Monterey Road in San Jose.

Dough Burger: Big burgers, shakes and fries at 1721 Old Bayshore Highway. “All meat is Hand-Slaughtered Halal,” they brag on their website.

El Amigo: Family-style Mexican food and beverages located in Santa Teresa Village, in South San Jose. Regulars love the wet burrito as well as breakfast favorites like huevos rancheros and machaca.

Eos & Nyx: This Mediterranean-inspired two-story dining complex comes from MO Hospitality Group, the folks driving Downtown San Jose’s revival with MiniBoss, PaperPlane, Still O.G., and Alter Ego. The restaurant opened this past November as part of Urban Catalyst’s Paseo project.

Hey Chicken: This fried chicken fast-food joint opened at 670 River Oaks Pkwy. last year.

La Korita Restaurant: Offering up a combination of traditional Mexican street foods like tacos and quesa birrias in what was formerly Tony P’s Park Ave Bar & Grill, La Korita also offers a Mexican seafood menu.

La Más Querida Cantina & Cocina: Located at King and Story Road, this Mexican bar and restaurant that aims for a festive, fiesta feel.

Los Arcos Restaurant: Traditional Mexican food and entertainment that’s been open for more than a year on Tully Road. Live entertainment, big portions, and plenty of parking.

Mendocino Farms: The sandwich shop opened its fourth location in San Jose at the Westgate Center offering up its trademark “fast-casual” fare of gourmet sandwiches and salads.

Moonwake Coffee Roasters: What began as a pop-up cafe out of the back of a Tesla Cybertruck, husband and wife team of Ming Wood and Mabel Yeung opened a cafe proper at 1412 Saratoga Ave. in West San Jose this past fall bringing a little Apple Store atmosphere to coffee culture. 

Mylapore South Indian Restaurant: Opened in April in the Westgate Mall, Mylapore offers quick, easy, and inexpensive vegetarian dishes like dals, dosas, and jaggeries.

Pizza Guys: The Sacramento-based chain opened its fourth San Jose location at 2471 Berryessa Road, Suite 2 in September as part of its plan to open eight more franchises in the state.

The Pressroom: Located at the intersection of Santa Clara and North Almaden Ave., this upscale restaurant and bar will be the latest addition to restaurateur David Mulvehill’s San Jose mainstays, Five Points craft cocktail bar, O’Flaherty’s Irish Pub, Dr. Funk Rum House, and Hella Good Burger. Done in partnership with Nuvo Hospitality Group, it’s expected to open in early 2025.

Pho King Restaurant: Celebrating chicken noodle pho, this Vietnamese restaurant at 385 Kiely Blvd. also celebrates traditional pork chops and spicy beef noodle soup.

Raising Cane’s: The fried chicken finger chain, founded in Louisiana in 1996, plans to open later this year at the Evergreen Circle shopping center.

Shake Shack: The New York-based gourmet burger chain opened a third location in San Jose at the Westgate Center at 1640 Saratoga Ave. with a rumored fourth location to be on the way in 2025.

Taelynn Cafe: A modern Vietnamese coffee shop located in the Sun Plaza offers a variety of teas and coffees with some small bites like beef and rice and banh mi sandwiches.

Tang’s Asian Vegetarian Restaurant: A Vietnamese specialty restaurant — an all-vegetarian menu — opened on the site of Champa Kitchen, a halal-style Vietnamese restaurant. Foodies on social media praise Tang’s use of meat alternatives like mushrooms and bean curd as well as being one of the more sensibly priced veggie restaurants in the area.

Wowmia Pizza: Recently opened pizza joint that offers an all-you-can-eat lunch buffet as well as its signature pizzas at 2951 Monterey Rd.

Sunnyvale

Bafang Dumpling: Taiwan’s premiere dumpling chain is set to open this summer at the Santa Clara Square, 2702 Augustine Dr. offering up potstickers, dumplings, and beef noodle soup,

Mylapore: The sister restaurant to the San Jose location which opened in April last year, this South Indian-style restaurant opened in September at 1025 W El Camino in Sunnyvale, formerly the site of family-owned Pezzella’s Villa Napoli Italian Cuisine.

Keke’s Breakfast Cafe: The Denny-owned restaurant opened its doors Nov. 11 at 311 South Mathilda Ave. Keke’s is known for its handmade classic American breakfast combos featuring waffles, pancakes, French toast, omelets, grits, bacon and sausages. The company said its California location, managed by Tyler Etter, includes the restaurant chain’s first cocktail bar that serves regionally sourced wines, beers and espresso coffee.

Fremont

Din Ding Dumpling House: More than three years after a fire burned down its original location, this Fremont staple reopened this past September in downtown Fremont’s Capitol Square at 3768 J Capitol Ave. bringing back its assortment of dumplings, noodles and veggies.

Fremont Food Hall: Located at 3768 Capitol Ave., the food hall offers three unique dining experiences: Capture Coffee, an adventurous coffee shop; Smochi, which makes mochi donuts, and the Korean-style hotdog vendor, Ya! Daebak.

Los Gatos

Dar Restaurant and Bar: Setting up shop in what was once the California cuisine bistro Eleven College Ave., Dar was founded by brother Milad and Esam Shaqir, bringing Mediterranean food to Los Gatos’ Soda Works Plaza. The brothers had found success in Saratoga with their first restaurant, the Tamra Mediterranean Grill.

107 Bistro & Wine Bar: Located at the Testarossa Winery in Los Gatos Bistro 107 opened this past October, a response to what owner Rob Jensen said was demand from his customers. The menu offers everything from charcuterie to full-course dinners all offered with the winery’s best vintages.

Mountain View

Joyous Cuisine: Opening last February, Joyous offers Guizhou-style Chinese cuisine with mixture of sour and spicy flavors particular to this Central China province. Noodle dishes dominate the menu, with beef, lamb, fish and varieties of tripe on offer.

Broma: Spanish and Portuguese inspired food from Michelin star Chef Jared Gallagher, located in the newly opened Shashi Hotel, a stone’s throw from both the Computer History Museum and the Google campus. Diners love the cozy atmosphere, eclectic menu and service.

Idly Express: From the owners of San Jose and Sunnyvale’s Mylapore comes the latest Indian fast-food restaurant. This location opened in July, joining three other Silicon Valley locations, San Jose, Milpitas, and Fremont.

Monterey

The Lantern Room and Tidewater: The Lantern serves breakfast and dinner as part of Monterey’s first waterfront hotel, the Monterey Beach Hotel, while guests and visitors can enjoy light fare and cocktails on the Tidewater deck overlooking the sea.

Morgan Hill

Hotel MOHI by Appellation: Though not expected to open until Fall 2025, this latest hotel/destination — located at 17490 Monterey Road — is the brainchild of Léal Hospitality, celebrity chef Charlie Palmer, and luxury hospitality veteran Christopher Hunsberger. The menu is expected to be farm-to-table, highlighting local wines and vintners.

Palo Alto

Horsefeather: Coming in 2025, this trendy brunch, lunch and dinner place will be located across the street from Stanford University in the Town & Country Village shopping center. The restaurant is the brainchild of Justin Lew, Hanson Li, and Tiffany Yam, the folks behind popular San Francisco bars Horsefeather and Last Rites.

RH Rooftop Restaurant at RH Palo Alto: Luxury home furnisher RH (with headquarters in Corte Madera) opened its latest experiential showplace this last May at the Stanford Shopping Center on the site of the former Macy’s Men’s building. The year-round sky lighted space with live olive trees and dazzling chandeliers offers updated California cuisine breakfast, lunch, and dinner with a weekend brunch menu.

Macarena: Scheduled to open in February, this Spanish comfort food restaurant, located at 420 Ramona St., is in the middle of a controversy, as it faces a lawsuit from former employees, accusing the owners of stealing their recipes.

Santa Clara

Clara’s Junction: This past September saw the opening of this casual dining restaurant and beer garden on the site of a former Carl’s Jr. in the city’s Tasman East neighborhood. The menu offers a wide variety of sharing platters as well as salads and bowls, smash burgers and grilled vegetables and entrees.

Kunjip: Savory, comforting Korean comfort food like Seolleong Tang, an ox-bone broth served with beef and noodles, or Galbi Tang, the beef short rib soup served with glass noodles, opened at 1066 Kiely Blvd. in Santa Clara last year to great success.

Closures

Red Lobster: The Fremont location, at 39401 Fremont Blvd., was one of 100 restaurants closed last year as the national restaurant chain went through a major bankruptcy and restructuring. Two Silicon Valley Red Lobsters remain open in Salinas and San Jose.

Pezzella’s Villa Napoli: After more than 68 years, this Sunnyvale landmark closed its doors in July after Global Investments, LLC purchased the restaurant’s site for $4.6 million. Owner Vince Pezzella, 83, who ran the restaurant with his son, Rafael, and daughter, Maria, decided it was time to hang up their aprons and take a break. 

Starbucks: San Pedro Square’s Starbucks closed the first week of January, with 10 of its employees being transferred to other San Jose locations. The store had successfully unionized in March 2024.

A Maryland-based investment management firm purchased nearly 56,000 square feet of property in Fremont, the company said Friday.

Realterm is now the owner of two local industrial outdoor storage maintenance facilities. Real estate investment company Lift Partners sold the properties for $25,875,000, according to Realterm.

The smaller of the two sites that Realterm purchased includes a 11,750-square-foot maintenance shop and 4,061-square-foot office, at 5120-5170 Brandin Court. Equipment rental company Herc Rentals occupies the space.

The second property, at 44533 South Grimmer Blvd., includes a 36,600-square-foot maintenance shop and 3,571-square-foot office. It is occupied by Halcon Corporation, a national transportation and operational solutions provider.

“Realterm has strategically entered the Silicon Valley industrial market with the acquisition,” the company’s Managing Director and Senior Fund Manager Stephen Panos said in prepared remarks.

Realterm is an independent, global company with a focus on the transportation industry.

“These two properties strengthen our West Coast market position, adding premium assets with top-tier tenants in a new dynamic industrial market,” Panos said.

The Bay Area’s industrial market has been growing, according to Realterm President Isaac Lau. This growth is signaled by increasing rental rates, strong demand and low vacancy, he said.

Industrial and warehouse property vacancy in Silicon Valley has rarely exceeded 3% over the last 10 years, according to a Kidder Mathews market report. The lease rate has also consistently climbed in recent years. The average asking lease rate for industrial properties, as of the third quarter report, was $1.99 – up from $1.80 in 2023’s third quarter.

JLL ‘s Ryan Sitov and Melinda Marino facilitated the transaction and represented the seller.

Lift Partners is a San Francisco-based real estate investment company focused on West Coast industrial and office property.