East S.J. retail center to sell, not lease, shops
MOST OF VIETNAM TOWN'S CONDO UNITS SOLD
By Katherine Conrad
Thu Hoang Ly / Mercury News
The Vietnam Town mall on Story Road is set to begin construction this month and finish in December 2007.
More photosFor Lap Thanh Tang, Vietnam Town is a personal flag planted in East San Jose offering fellow immigrants the chance to own a piece of the American pie.
The 300,000-square-foot commercial development on Story Road offers entrepreneurs the opportunity to own their own store, -- a prospect that's especially attractive to immigrants seeking to plant roots and move up the economic ladder.
``We know of the desire of the business people,'' Tang said. ``They like to own something for their lifetime, for their children -- instead of paying rent.''
Tang, who is one of the developers of Grand Century Mall next door and an owner of Vallco Fashion Mall in Cupertino, also wants to create a shopping experience reminiscent of the ultra-chic Santana Row. So enamored is Tang of the open-air mall that he measured the width of its sidewalks to make his the same size.
``I want Vietnam Town to be the Santana Row of the East Side,'' he said.
His project, scheduled to begin construction this month and finish in December 2007, is a cluster of nine buildings constructed across a pedestrian-friendly, 20-acre site.
Unlike most conventional shopping centers, however, retailers in Vietnam Town will own rather than lease their space. It's a risk, but Tang said business owners have flocked to buy the 1,000-square-foot units.
He's not surprised. Tang said the time is right for a city with 90,000 Vietnamese, among the largest such community in the United States, to have its own Vietnam Town. While many U.S. cities have Little Saigon neighborhoods with predominantly Vietnamese businesses, Tang believes his development is the first to be called Vietnam Town.
It hasn't been easy.
When Tang began selling the 1,000-square-foot units on behalf of TWN Investment, he had little to show potential buyers -- only the promise that the new project would resemble Santana Row. And he still had to get approval from the city to knock down an old Hewlett-Packard warehouse and rezone the industrial property.
But Vietnam Town has proved popular. Units that listed at $400,000 two years ago now sell for $600,000. And of 256 units initially available, Tang has only 50 units on the second floors left, as well as 25 units he is waiting to sell in one building.
Tang is clear that the units are available to all buyers, but given the name of the development, most have sold to Vietnamese-owned businesses.
Doan Trang, a real estate broker who owns Benchmark Realty and Finance, bought a unit for $450,000 after she heard about Vietnam Town from other Vietnamese immigrants.
``We don't want to rent anymore,'' she said. ``The Vietnamese work so hard. First they own a house, then own a business, then own a building.''
Ray Tong, a Fremont developer who was project manager for Ranch Market in San Jose and Mission Square in Fremont, said the challenge for Tang in offering the units for sale rather than lease is getting the right tenant mix. When units are sold in the future, the developer loses control of deciding which retailer locates where.
``I'd be very curious if a mall with one single theme is going to do well,'' Tong said. ``But I think it stands a better chance in San Jose because the Vietnamese population is so great.''
Tang agrees that tenant mix is a challenge. He learned at Grand Century Mall not to locate all the food vendors in one area because that's where most of the foot traffic goes. So in Vietnam Town, there will be a food retailer on every corner. But he acknowledged in an e-mail, ``That is only for now. If they are changing hands in the future, we cannot control.''
Mike Enderby, San Jose's senior planner, said the city wanted a different look with this retail center, larger than most by 100,000 square feet. So Vietnam Town is not designed as a row of stores at the back of a parking lot -- parking will be available in a five-level garage.
Councilwoman Madison Nguyen called the Vietnam Town development ``long overdue.'' It has taken decades, she noted, for the Vietnamese to develop a project this size.
``The Vietnamese were very poor. To get into development takes a lot of money, plus it's a big risk,'' she said. ``I'm glad Mr. Tang has the vision to do this. This is a legacy project. We came here with nothing and this is what we have done.''
Tang said Vietnam Town is his tribute to those who left Vietnam in terror and came to the United States, willing to work for a better life. Tang, who left 31 years ago in a boat, is acutely aware of how far he has come from his first job as a night janitor.
``The first wave of boat people couldn't do much. They didn't have any money and they had to go out and work hard to support a family,'' Tang said. ``Vietnam Town is for the second and third generations to witness the accomplishments of the first wave.''