Palo Alto tech hub lands buyer at huge value drop in frail market

A tech hub in Palo Alto that was once home to a major defense contractor has been bought in a deal that points to a price plunge for the office site.

admin July 16, 2026 2 minutes read

PALO ALTO — A tech hub in Palo Alto that was once home to a major defense contractor has been bought in a deal that points to a price plunge for the office site.

The two Palo Alto office buildings were bought for $163 million by an affiliate linked to real estate firm Harvest Properties, documents filed on July 15 in Santa Clara County show.

RELATED: Real estate firm acquires tech and research building in North San Jose

That price represents a 44% value nosedive from what the seller, Alexandria Real Estate Equities, paid in 2019 when the company paid $291 million for the office buildings in 2019.

The buying group bought office buildings with addresses of 3825 and 3875 Fabian Way, the county real estate records show. The new owner is an LLC based at Harvest’s headquarters in San Francisco.

The transaction is an example of the meltdown in office building values in the years after the business shutdowns linked to COVID-19 chased employees away from their work hubs.

When Alexandria Real Estate bought the buildings, the office market was flying high.

Tech companies engaged in a shopping spree for work sites throughout the Bay Area. In Alexandria’s case, Google had just bought office sites near the buildings that the real estate firm acquired.

Yet after the shutdowns ended, the disruptions had forced countless tech companies to rethink their requirements for office space. In most cases, companies decided to scale back their office footprints.

The slump in office leasing also unleashed waves of slumping values, failed property loans and even foreclosures of delinquent mortgages.

The just-bought Palo Alto buildings together total 485,200 square feet. The 3825 Fabian building totals 290,900 square feet. The 3875 Fabian building totals 194,300 square feet.