The 561,465 square foot Brocade Communications corporate headquarters site in San Jose has a new owner as of last week. Menlo Park-based Lane Partners acquired the three-building complex located at 110, 120 and 130 Holger Way, also known as known as HQ @first, for $225.5 million, or roughly $401 per square foot, according to a statement from NKF Capital Markets, which arranged the sale on behalf of the seller, Broadcom, as part of Broadcom’s acquisition of Brocade. The property also has a 1,821 stall parking garage that includes a 550-kilowatt photovoltaic system on its rooftop, which was part of the deal.
The property, which was opened in 2010, was the corporate headquarters for Brocade Communication Systems, founded in 1995, and provides data center networking solutions and services to manage information assets. The building at 110 Holger Way covers four stories and is 124,767 square feet. 120 Holger is a 7-story building of 218,349 square feet. 130 Holger is another 7-story building with the same square footage. The property also has an option for a fourth tower, entitled up to 320,000 square feet. The property covers 9.7 acres of land, and it is located at the intersection of North First Street and Highway 237. At the time it was developed, it enabled Brocade to consolidate five local facilities while accommodating an additional 600 employees.
The listing agent on the sale is the San Francisco office of NGKF Capital Markets Group. One of the people involved in the sale was Steven Golubchik, a vice chairman with NGKF. Others who worked on the transaction were Executive Managing Director Edmund Najera and Associate David Hosler.
“HQ @first is one of Silicon Valley’s most iconic campuses and, until recently, had never been available for purchase or lease,” said Golubchik in a statement. “Lane Partners demonstrated an exceptional amount of commitment to the deal which ultimately resulted in an expeditious and smooth closing process for our client.”
Lane Partners did not return calls seeking comment on the story.
When the project was opened in 2010, the estimated cost of the development was pegged around $278 million, with the former San Jose Redevelopment Agency investing $2.5 million for new capital equipment acquisitions. It has been anticipated at the time that during the course of the five-year agreement with the Redevelopment Agency, the project would generate an estimated $10 million to the City’s General Fund and the Redevelopment Agency’s tax increment.
When The Registry broke the news in March of 2017 that the property was for sale, it was estimated that the offering would give potential buyers the chance to acquire a major asset in Silicon Valley at a 60 percent discount to replacement cost for a similar product. The feeling in the brokerage community at the time was that to build multi-story steel frame with finished office interior, excluding land, would likely be around $400 per square foot.
The campus complex has many amenities that technology companies are looking to have in their office space. This includes outdoor barbeque and patio areas, a basketball court, fitness center/locker rooms, game room, a cafeteria that can hold in excess of 300 people and an expansive executive business center. Lane Partners intends to renovate all of the landscaping on the property and construct a new outdoor amenity area between the buildings at 120 Holger Way and 130 Holger Way.