Shopping spree widens for Silicon Valley buildings in tech hotbeds
A shopping spree for Silicon Valley buildings in tech hotbeds has widened with the purchase of a San Jose building leased to a telecommunications equipment maker.
Peninsula Land & Capital, including the real estate firm’s most recent building purchase in north San Jose, has spent $165 million in recent days, according to documents filed with officials in Santa Clara County and Alameda County.
The deals point to a pair of trends in commercial real estate. Real estate firms are scouting for properties in hubs where tech firms and advanced manufacturing companies are located. And investors are betting that the Silicon Valley economy is poised for a robust long-term rebound despite coronavirus-linked uncertainties and a still-wobbly job market.
Peninsula Land & Capital has bought buildings at two sites in San Jose, two in Fremont, and one in Milpitas, the public records filed with county officials show.
The slew of transactions occurred on consecutive days last week.
In the most recent deal, Peninsula Land & Capital paid $23 million for a north San Jose building that totals 80,600 square feet, according to a deed that was recorded on June 25.
Lumentum Operations, the building’s occupant, was the seller in the deal. Lumentum is a tech firm that makes optical and photonic equipment and is a company of the type that has drawn the interest of commercial property buyers lately.
“We just see good value in research and industrial buildings in good locations,” Roger Field, a principal executive with Peninsula Land said last week.
The transactions that occurred on June 24 involved several buildings in three different Silicon Valley cities. These are the buildings that were involved and the prices:
— $87.7 million for a group of south San Jose buildings with addresses ranging from 6311 through 6351 San Ignacio Ave. Together, these buildings total at least a combined 331,400 square feet, according to property listing services.
— $23.2 million for a two-building complex in Milpitas building with addresses of 223 through 237 S. Hillview Drive. The buildings together total about 100,000 square feet.
— $16.7 million for a Fremont building at 3481 and 3501 W. Warren Ave. The building totals 68,700 square feet.
— $14.5 million for a Fremont building at 2800 Bayview Drive. The building totals about 59,000 square feet.
“All of the buildings have tenants and they all accommodate advanced manufacturing types of uses,” Field said.
One of the buildings serves as the headquarters of a maker of advanced batteries.
Enovix is in the West Warren building, which accommodates the company’s head offices, research activities, and battery manufacturing operations in Fremont.
DRA Advisors, a New York City-based private equity firm, and Westcore, a San Diego-based commercial real estate firm, were the firms that sold the properties on June 24 in the first cluster of transactions.
“We are seeing a lot of demand for these buildings that are suitable for companies involved in high-end manufacturing,” Field said.