Markets Across Silicon Valley Continue to Grow as Large Household Names Push Demand
San Jose – December 17, 2013 – CBRE announced today the sale of the Sunnyvale Office/R&D Portfolio, which includes 16 office and R&D buildings totaling 508,946 square feet primarily located in the Peery Park submarket within Sunnyvale, California. Menlo Park-based Lane Partners purchased the portfolio which was 94% leased to a diverse tenant roster including Apple which leases 33% of the portfolio’s net rentable area.
CBRE marketed the sale of the portfolio on behalf of a Global Investment Manager. The CBRE marketing team was comprised of Joseph Moriarty, Executive Vice President; Russell Ingrum, Vice Chairman/Managing Director; Sean Sullivan, Executive Vice President; Tyler Meyerdirk, Vice President; and Brad Zampa, Executive Vice President.
“We saw strong interest from the investment community for the opportunity to acquire a critical mass of office and R&D product located in one of the country’s top performing markets,” says Mr. Moriarty at CBRE. “The portfolio will continue to provide a strong in-place cash flow and a tremendous upside opportunity as market rents continue to increase across all of Silicon Valley—and particularly in submarkets like Sunnyvale.”
Thirteen of the buildings are located within Peery Park, one of the premier submarkets in the Silicon Valley, due to its centralized location with immediate access to Highways 101, 237 and 85. The other three buildings are located in South Sunnyvale within two miles of Peery Park. Buildings range in size from 10,000 to 59,000 square feet. The portfolio is leased to a diverse mix of tenants from a wide range of technology sectors including medical device, bioscience, wireless networking, computing software and personal electronics.
“We believe that Sunnyvale will continue to experience the strong fundamentals demonstrated over the past eight quarters as the demand from large household name companies grow in the Silicon Valley,” says Mr. Moriarty at CBRE.
Since the third quarter of 2011, the submarket has witnessed a 462 basis point decrease in the vacancy rate while asking rates have risen over 28% during the same time frame with much room for growth. CBRE-Economic Advisors projects that Sunnyvale will experience 31.7% cumulative rent growth from 2013-2018, equal to 5.65% compound annual growth rate.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2012 revenue). The Company has approximately 37,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 300 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.