By Meghan Hall
After closing on a deal for two buildings in Santa Clara, San Francisco-based GI Partners has nabbed a third building near Bowers Avenue and Walsh Avenue in a transaction that closed on March 2nd. GI Partners purchased 2805 Bowers Avenue: a 104,000 square foot building, for $37.5 million. The seller was KeyPoint Credit Union according to The Mercury News, who first reported the transaction.
The deal for the KeyPoint Credit Union Building follows on the heels of another $40 million acquisition for GI Partners. The same day, the firm purchased two office and research and development buildings known as Walsh Bowers from Equus Capital Partners. The buildings are located at 2710 Walsh Ave. and 2845-2855 Bowers Avenue. There are no vacancies at the property, with tenants such as Appl,e, miraDry Inc., and EAG Inc. as tenants.
All three buildings sit on a combined 11.4 acres within Santa Clara’s “Golden Triangle.” The area is well-known for access to high-tech capital, retail and major transportation hubs such as Mineta San Jose International Airport, the Lawrence Caltrain Station and the Santa Clara Convention Center.
Both the office and research and development asset classes faced challenges in 2020. The fourth quarter of last year brought the Silicon Valley office market its fifth consecutive quarter of negative absorption, based on information released by Newmark at the end of the fourth quarter. Vacancy increased to 11.28 percent. The local research and development asset class also saw a number of large availabilities come online, and saw negative absorption for the eighth straight quarter. Vacancy rose to 12.57 percent, its highest level since 2014.
While the investment market for both asset classes has been slower, Newmark believes that the transactions that have occurred are a silver lining. Several larger deals have punctuated the Silicon Valley market, providing necessary momentum and an indication of investor confidence. Heading into 2021, the brokerage firm believes that Silicon Valley is well-positioned for continued investment long-term.