Empty San Jose tech campus once leased by eBay suffers loan default

SAN JOSE — A tech campus in San Jose that was once leased by eBay has tumbled into a loan default, fresh evidence that the Bay Area office market continues to suffer wide-ranging ailments and fading values.

The owner of the office complex, on North First Street between Component Drive and Trimble Road in north San Jose, has defaulted on an $88.1 million loan, documents filed July 29 with the Santa Clara County Recorder’s Office show.

The four-building tech hub has addresses of 2515, 2525, 2535 and 2545 N. First St., the default notice states.

In 2018, South Korea-based Hana Asset Management and Southern California-based Ocean West Capital Partners paid $132.5 million for the office hub, which totals 250,100 square feet.

At the time of the purchase, Deutsche Bank A.G. New York Branch provided a Hana Asset and Ocean West affiliate with the loan that is now in default, according to the property files.

The office complex has been empty since eBay exited the property in 2020. eBay first moved to the site in 2011.

The company was still paying rent when it departed the tech hub. eBay’s rental deal, however, enabled it to terminate the lease payments in March 2026, financial services and analysis firm Morningstar reported in 2023. That would mean the empty site ceased producing income a few months ago.

The property’s value has plummeted, Morningstar reported on June 18. The office complex has a value of $54.7 million, which would be 59% below what the current owners paid for the site in 2018.

The ongoing and protracted slump in Bay Area commercial real estate values might jolt the delivery of public services. Falling real estate values in a community can imperil a crucial revenue stream from property taxes for cities, counties, regional agencies, and school districts.

A foreclosure could occur within a few months unless the current property owners can find a buyer willing to purchase the site for a price that can cover the delinquent loan.

“The borrower is awaiting best and final offers while the servicer proceeds with a foreclosure,” Morningstar stated in its report.