What has been one of the most commonly understood anecdotes in the Silicon Valley commercial real estate market has finally been confirmed. According to the Silicon Valley Business Journal, Google has taken over the ownership of 52 parcels in Sunnyvale that Los Angeles-based CBRE Global Investors has been accumulating over the last few years on its behalf.
The information was made available by the county earlier this week, and Google had confirmed the transfer, but provided no additional information. The total value of the properties is pegged at $820 million.
When Google started buying up properties in and around Mountain View, some sellers were anxious to automatically add a premium to their prices. The tech giant quickly found a workaround, using the CBRE Global Investors’ platform to acquire property, often without any information about the source of funding. There was an understanding in the industry that Google was likely the money behind the purchases, even though it was never confirmed by either party. To be fair, CBRE did not acquire property for other clients and investors, as well, but the proximity of the buildings to Googleplex was somewhat of a giveaway.
Google has amassed a formidable portfolio of real estate assets across Silicon Valley over the years, and its latest foray into San Jose is just another example of its large ambition. It was big news for the self-proclaimed capital of Silicon Valley to attract such a large global player, but, as Mayor Liccardo pointed out in his blog post this week, it isn’t a sure thing.
“Lots of big plans are launched to fanfare, but the world changes – economies dip, shareholders balk, and corporations pivot. History offers San Jose too many cruel reminders: the groundbreaking of the Tesla factory in North San Jose a decade ago, Apple’s plans for a Coyote Valley headquarters in the 1980’s, and the like,” Mayor Liccardo stated. “The Council and City Hall need to focus on doing whatever we need to do to eliminate barriers – legal and regulatory obstacles, red tape, and other hurdles – to facilitate these extraordinary investments in our city.”
For now, we can wonder where Google’s office space needs end and consider the impact of such a large owner/occupier on the Silicon Valley market. Its appetite certainly does not seem to be abating.