SAN JOSE — Betting big on Silicon Valley’s future, an investment group led by an England-based firm paid a combined $1.16 billion for six tech campuses in three cities, according to several grant deeds filed in Santa Clara County in September.
Read more Regional Medical Center boosts ER beds in face of growing need
“We see significant opportunity in this portfolio given the strong tailwinds across the business landscape right now in Silicon Valley,” said Jerome Foulon, global head of commercial real estate with Lone Star Funds.
London-based Lone Star Funds acquired 2.2 million square feet across six campuses, 50 buildings, and 140 acres in the Golden Triangle, an area roughly bounded by U.S. Highway 101, State Route 237 and Interstate 880.
“This is really positive for Silicon Valley,” said David Sandlin, an executive vice president with commercial real estate firm Colliers. “All the indications are that the market is going to get stronger.”
Bay Area real estate firms TMG Partners and Grove will be the operating partners for the six sites in San Jose, Milpitas and Santa Clara.
“The new owners are likely going to reap a lot of benefits from that portfolio,” Sandlin said. “These are quality, functional buildings.”
Washington Holdings was the seller in the deals.
Montague Oaks in North San Jose was bought for $300 million. The eight-building campus totals 295,000 square feet on 18.6 acres with addresses ranging from 627 to 655 River Oaks Parkway.
North First @ Orchard Station in North San Jose was acquired for $210 million. The six-building, 17-acre site totals 266,800 square feet and has addresses that include 41 Daggett Dr.
Read more The Posh Bagel opens in South San Jose; 3 more Bay Area shops are coming
Mission Park, a 12-building Santa Clara complex, was bought for $195 million. The 33-acre office and research park totals 500,300 square feet. The site includes a data center that totals 73,000 square feet, a retail hub and a 175-room hotel.
Montague Square in North San Jose was bought for $186 million. The 15-acre, six-building campus totals 251,200 square feet and is at the corner of Montague Expressway and North First Street.
Tasman Tech Center in Milpitas was bought for $176 million. The 14-building, 47-acre office and research hub totals 736,800 square feet. Its addresses include 1450 McCarthy Blvd., 540 Alder Drive and 700 Tasman Drive.
Zanker Place, a four-building office center at 1920 Zanker Road in North San Jose, was bought for $96 million. The complex totals 142,000 square feet. The Google Brokaw campus and the PayPal headquarters are nearby.
The properties acquired by Lone Star Funds are 87% leased, according to TMG Partners and Grove.
“This acquisition represents a rare opportunity to secure the most cohesive assemblage of mission-critical R&D space in Silicon Valley in a single transaction,” said Ben Kochalski, co-chief executive officer with TMG Partners.
Read more Walks doom SF Giants in series finale defeat vs. Pirates
About the Author
