Nvidia is leasing a 302,800-square-foot advanced technology building in San Jose's Santa Teresa district, which is expected to include computer labs with server racks, research facilities, and office space operating at 49 megawatts of power. The move signals Nvidia's expanding footprint in the South Bay and aligns with local utility upgrades—PG&E has doubled capacity at a nearby substation and plans further expansion over the next three years to support the region's growing energy demands.
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Nvidia is leasing a 302,800-square-foot building at 5853 Rue Ferrari in Santa Teresa, San Jose, according to sources familiar with the agreement and commercial real estate reports. Proposals submitted to city planners in April and June describe advanced technology facilities including a computer lab with server racks, research and laboratory spaces, work labs, and office areas. The facility would operate with 49 megawatts of power.
Why it matters
The lease reflects Nvidia's continued expansion in the South Bay near its Santa Clara headquarters, where it has already purchased numerous parcels to expand its primary administrative complex. The facility's heavy power demand aligns with regional infrastructure upgrades—PG&E has doubled electricity capacity at a nearby substation from 40 megawatts to 80 megawatts, with further expansion planned over the next three years to support San Jose's growing energy needs.
What to watch
The building is owned by Prologis (which acquired it through its $26 billion（約4.2兆円） purchase of Duke Realty in 2020) and is undergoing tenant improvements and upgrades. Construction activity is already visible on and inside the structure. Neither Prologis nor Nvidia has responded to requests for information about the facility's purpose.
Nvidia has entered into a lease for 5853 Rue Ferrari, a 302,800-square-foot building in the Santa Teresa district of south San Jose, according to sources familiar with the agreement and commercial real estate market reports. The facility is expected to serve as an advanced technology center and is undergoing construction and tenant improvements. Proposals submitted to city planners in April and June outline the intended use: the building will include at least one computer lab equipped with server racks, as well as research and laboratory spaces, work labs, and office areas featuring a conference room. The facility is designed to operate at 49 megawatts of power, a capacity detailed in an April filing; a March filing with city planners had earlier envisioned on-site electricity facilities.
The property is owned by real estate development and investment firm Prologis, which gained ownership through its $26 billion（約4.2兆円） acquisition of Duke Realty. Duke Realty had originally purchased the 17-acre site for $40.6 million（約65億円） in 2020. Prologis is overseeing tenant improvements and upgrades at the site, while CBRE, a commercial real estate firm, is handling marketing. On-site observation in recent days revealed considerable construction activity next to and inside the building, whose shell is already complete. Neither Prologis nor Nvidia responded to multiple requests for information about the lease or the facility's intended use.
The lease is consistent with Nvidia's broader South Bay expansion strategy. The Santa Clara-based company has purchased numerous parcels of land next to and near its headquarters at 2788 San Tomas Expressway to accommodate significant growth of its primary administrative complex. The new lease appears to represent a complementary facility for specialized advanced technology work. Notably, regional power infrastructure has been upgraded in parallel: PG&E doubled the electricity capacity of its substation at 6402 Santa Teresa Blvd.—approximately a mile from the Rue Ferrari building—from 40 megawatts to 80 megawatts. This upgrade was carried out at the request of data center developer Equinix. PG&E configured the substation to be scalable, allowing the utility to readily add equipment to support additional load. PG&E spokesperson Stephanie Magallon stated: "There are plans to further expand the Santa Teresa Substation in the next three years to help us meet San Jose's growing energy needs."
Nvidia's lease of the 302,800-square-foot Santa Teresa facility represents a deliberate expansion of its operational footprint in the South Bay. The company has already been acquiring land near its Santa Clara headquarters at 2788 San Tomas Expressway to grow its primary administrative complex, and this new lease extends that strategy into a specialized advanced technology center. The facility's design—featuring computer labs with server racks, research spaces, and the ability to draw 49 megawatts of power—suggests a hub for intensive computational work, whether research, development, or data-center operations.
The timing and power requirements of the lease align closely with infrastructure changes underway in the region. PG&E doubled the electricity capacity of its Santa Teresa substation from 40 megawatts to 80 megawatts at the request of data center developer Equinix, and has designed the substation to scale further. A PG&E spokesperson stated the utility has plans to expand the same substation over the next three years to meet San Jose's growing energy needs. This coordinated investment in power infrastructure suggests that multiple large technology operations—not only Nvidia but also other data center users—are driving demand in the area.
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