SAN JOSE — A game of monopoly with stakes potentially in the hundreds of millions of dollars is underway on a choice block in downtown San Jose — years before the property is likely to be developed.

Swenson, a legendary Bay Area developer, is the latest to buy a parcel in what some experts call “The Mitchell Block,” a section of downtown San Jose near First Street and Santa Clara Street currently dominated by big surface parking lots that are ripe for redevelopment into multiple office towers.

Taller, denser development near transit is one of the keys to a more vibrant downtown,” Case Swenson, Swenson’s chief executive officer. “We’ve always been all-in on San Jose.”

A significant owner on the block, bounded by West Santa Clara Street, North First Street, West St. John Street, and North Market Street, is the Valley Transportation Agency. The VTA is known to have mundane short-term plans and grand long-term visions for the properties it controls on the block.

In the short-run, the VTA-owned surface parking lots will be used as staging areas for materials and construction gear needed for the BART stations that are slated to sprout at First Street and the Diridon train station. VTA also owns a building on the block with addresses of 39 through 49 N. First St.

Long-term, VTA envisions some sort of major redevelopment, potentially office towers for tech titans, on most of the block. In 2007, VTA paid $39.6 million for the surface parking lots, which lie fallow well over a decade after VTA took ownership.

The development of new towers at the site would easily run into the hundreds of millions of dollars, based on current construction costs for modern office buildings.

Yet the VTA is only one of several owners at the site, and the recent Swenson purchase isn’t the only one by the developer on the Mitchell Block.

Swenson’s Green Valley Corp. paid $4.1 million for a property with addresses ranging from 41 through 55 W. Santa Clara St., according to property documents filed in Santa Clara County on Feb. 28.

The Green Valley group controlled by Swenson paid cash for the property, whose tenants are Chase Bank and the VTA, the public files show.

“This acquisition consolidates Swenson’s position adjacent to the proposed BART station entrance,” said Scott Knies, executive director with the San Jose Downtown Association.

Swenson also owns parcels at 99 N. First St., 80 through 86 N. Market St., and 26 N. Market St., county assessment records show.

Before the late February deal, Swenson bought the 80-86 N. Market properties for $2.9 million in 2017.

Another major private development player on the Mitchell site: Jay Paul Co.

In 2018, Jay Paul, one of the Bay Area’s most savvy developers, paid $46 million for the old JCPenney building, a deal arranged by Cushman & Wakefield broker Erik Hallgrimson.

One or more tech tenants are deemed to be suitable occupants for the JCPenney building at 1 N. First St. , where Jay Paul has launched a wide-ranging renovation.

The upgrade and facelift for the JCPenney office building are slated to be complete by this summer, according to a Jay Paul executive. Blue Bottle Coffee has leased retail space on the ground floor, the Jay Paul firm said.

Another property owner on the block is the Saratoga-based Hoefler family trust, which owns 81 W. Santa Clara St.

Tenants on the Mitchell Block, along with Chase Bank and VTA, include Legal Pursuit, Gotta Eatta Pitta, Shisha Hookah Lounge, Back A Yard Caribbean Grill, Spearmint Rhino Gentleman’s Club, Erik’s Deli, and Umbrella Lounge.

Some downtown experts have speculated whether Jay Paul or Swenson — or both — might emerge as partners with the VTA to develop of a mega-campus with millions of square feet of offices on the Mitchell Block.

“The Swenson acquisition is a tactical move in an attempt to force themselves into a joint venture to develop the site,” said Bob Staedler, principal executive with Silicon Valley Synergy, a land-use consultancy. “It’s a risky bet because it would not be difficult to build around them.”

Adding to the interest in downtown San Jose: Google has proposed a transit-oriented community near Diridon Station called Downtown West where the search giant would employ 25,000 people and office buildings, hotel rooms, shops, restaurants, and homes would sprout.

Plus, Adobe is constructing an office tower on West San Fernando Street that would dramatically expand the tech titan’s existing downtown San Jose headquarters campus of three buildings.

One thing is certain: The Mitchell Block is poised to be a crucial piece of the downtown development puzzle, especially after the BART station opens next to it.

“VTA is doing really important long-range work to leverage future development with BART and this most prominent downtown core location,” Knies said.