Exeter Property Group Buys Unoccupied Assembly at North First in San Jose for $192MM

By Meghan Hall

A major office development in North San Jose has traded hands, giving an interesting glimpse into the risk of development in Silicon Valley. Assembly at North First, a 27-acre office campus built by ProspectHill Group, SKS Partners and Invesco Real Estate has sold for $192 million, or roughly $640 per square foot, according to The Mercury News. The buyer was Philadelphia, Penn.-based Exeter Property Group.

The commercial real estate industry has tracked the evolution of Assembly at North First for several years due to its location, size and development potential. The buildings that sold are located at 3930, 3940, 3950 and 4000 N. First St., and 90 Headquarters Way, near Samsung’s North American headquarters and other major companies such as Cisco. Attractions such as @First, a 10-acre retail center with more than 84,000 square feet of amenities, is also nearby.

Phase I of the redevelopment of property— known formerly as the LAM Research Campus — was completed in October 2018. Phase I included the renovation of four buildings, two of which were combined into a single, 100,000 square foot structure. Altogether, Phase I revamped about 300,000 square feet of office space, complete with a signature lobby entry and proprietary porches with indoor and outdoor space. The campus also includes amenities such as an indoor-outdoor fitness center with locker rooms and showers, and The Grove, a full-acre outdoor living and working space with wood-fired pizza ovens, seating areas and games. 

Phase II was announced in February of 2020, but its build-out was largely dependent upon Phase I leasing, according to The Registry’s previous reporting. If the developers had chosen to maximize square footage and build out to the full extent of the square footage in its entitlements, the three buildings that were a part of Phase II would have ranged in size from 198,000 square feet to 290,000 square feet of office space.

The campus was designed by global architecture firm Gensler.

However, despite its allure, the property has remained un-leased. ProspectHill Group, SKS and Invesco acquired the property in the summer of 2016 for $82 million, and the total redevelopment cost of the project was expected to be in excess of $200 million.

The asset’s new owner, Exeter, is the real estate division of EQT Group AB and is one of the largest investment managers in the world. The company has 40 offices in North and South America, Europe, and Asia. The company has 250 million square feet of commercial property under management and $10 billion in equity capital, according to its website. 

As of this writing, neither SKS Partners nor Invesco had returned The Registry’s request for comment.

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