San Francisco, CA – November 7, 2014 –CBRE Capital Markets’ Debt & Structured Finance team has secured a $100 million construction loan for The Grove, in Los Gatos, California. The state-of-the-art development will consist of 485,000 square feet of Class A office space in three-and four-story office buildings in a campus environment located on a 21-acre site. The first phase—which is already under construction and to be delivered in May 2015—will consist of 242,000 square feet in two office buildings preleased to Netflix, Inc. The project is located less than three miles from downtown Los Gatos, offering convenient access to a variety of restaurants and high-end shopping choices.
John Nelson of CBRE’s San Francisco office arranged the financing on behalf of the borrower/developer, a joint venture between Sand Hill Property Company and The Carlyle Group. The interest rate was a variable, LIBOR-based rate. The financing was provided by a syndicate of lenders led by SunTrust Robinson Humphrey with SunTrust Bank as Administrative Agent.
“Everything came together on this project—a strong and experienced sponsorship, a well-known and high profile tenant, and a very desirable, high barrier to entry market in Silicon Valley,” said Mr. Nelson. “This project will be the premier office project in the West Valley.”
Prominently located on Winchester Boulevard and situated alongside Highway 85—one of the most heavily traveled highway sections in the area—the property will provide superior visibility to more than 113,000 vehicles each day. Additionally, the property is located 1.2 miles from the Highway 17/880 on-ramp, which provides quick access to Interstate 280—one of the main arteries through Silicon Valley—and is the primary connector from south Silicon Valley through San Jose, and the San Francisco East Bay to the north.
Mr. Nelson added, “The very tough entitlement and approval process in the Town of Los Gatos, coupled with an extremely limited availability of developable land, make Los Gatos one of the highest barrier to entry markets in all of Silicon Valley.”
Santa Clara County is the best-performing metro economy in the nation and is likely to stay at or near the top for years to come, according to a January 2013 report released by the Santa Monica-based Milken Institute. The survey ranked 200 major metro areas in the United States. San Jose and the surrounding region returned to the top of the pack because of the income and wealth creation of Silicon Valley’s remarkable technology sector, according to the report.
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 2013 revenue). The Company has approximately 44,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through approximately 350 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.