San Jose's historic Bank of Italy building sells for nearly $34M

Another high-profile sale is highlighting the red-hot real estate market in downtown San Jose. This week, bi-coastal investors announced the purchase of the historic Bank of Italy building on Santa Clara Street.

"A lot of this is just part of the momentum that really is downtown's time," said Scott Knies, the executive director of the Downtown San Jose Association.

Part of seizing the future means reaching back to San Jose's past. Monday, investors in the Bay Area and back east purchased the 90-year-old Bank of Italy building, for almost $34-million.

"It's a long-awaited for opportunity for an iconic building in the heart of our downtown to get an overdue facelift," said Mayor Sam Liccardo, D- San Jose

Several blocks west of "Italy," sits another real estate jewel being sold for a small fortune. The current owners of the Fairmont Hotel say they have an agreement to sell this downtown jewel for about a quarter billion dollars..

"There's some real savvy investors that are picking up these b-buildings.. picking up buildings in the historic district, seeing them undervalued," said Knies.

Long before Google announced a footprint in San Jose that will rival Apple's so-called spaceship, downtown had been percolating with possibilities. With real estate at record highs, it seems these two high profile purchases could signal a time for cashing in, and recreating old into new for future growth beneficial for downtown workers and residents. 

"The man on the street is going to enjoy different types of tenants that are going to occupy it. that are going to be in the service industries, and ma and pa shops on the ground floor," Knies said.

City leaders promise no green for these deals, but less red tape as a way of ushering in the next wave of progress.

"This is really an opportunity for us to make this jewel shine," said Mayor Liccardo.

The mayor says it's time to protect and renovate all of the older office buildings that once defined the character of downtown -- and can again. As for the Fairmount, it's still too early to say what if any changes lie ahead for the 800-plus room hotel. But the new owners promise to keep it financially strong and a destination spot downtown..