By Meghan Hall
Pasadena, Calif.-based developer Alexandria Real Estate is no stranger to the San Francisco Bay Area, and its presence in Palo Alto has grown significantly over the past year. Now, its holdings there have grown again: the firm recently purchased two office buildings on Hillview Avenue for a combined $75.9 million. Both properties are located within the Stanford Research Park.
The first building, located at 3412 Hillview Avenue, is leased to SAP. Alexandria paid $56.1 million, or about $734 per square foot for the asset. The 76,478 square foot building was constructed in 2008, according to property documents and last sold by Stanford University in 2010 for $31.5 million.
The second building is leased to Kirkland & Ellis, a law firm, and for which Alexandria paid $19.8 million, or roughly $638 per square foot. The asset is located at 3330 Hillview Ave. The building is just over 31,000 square feet and last sold in June of 2013 for $20.075 million. Property documents indicate that Alexandria purchased the property from Northwestern Mutual and Hines. Northwestern Mutual is also listed as a party involved in the ownership or management of 3412 Hillview.
The sales were first reported by The Mercury News.
Alexandria has been steadily buying up land along the San Francisco Peninsula, and this latest acquisition builds upon the company’s already extensive portfolio in Palo Alto. In December of 2019, the firm closed on two buildings on Fabian way for $292 million in cash. The properties were sold by SSL Land LLC, affiliated with Space Systems Loral. The lots total more than 800,000 square feet. In
August of 2019, Alexandria acquired a different Stanford University asset at 3160 Porter Drive for $97 million, or about $1,000 per square foot. Stanford Health is the current tenant of the building. In January of 2019, Alexandria also acquired 3170 Porter Drive for $100 million for the 100,000 square foot property.
Stanford Research Park is one of the region’s most well-known tech and medical clusters. It is well-established and a huge attraction to companies looking to be competitively located among their peers. The park dates back to 1951, when its first tenant, Varian Associates broke ground, and has since been home to Hewlett-Packard, Facebook and other. Some of the research park’s current noted tenants are Tesla, Nest, Ford and Lockheed Martin, among others.