Google’s presence in Mountain View has been a driving force for that city’s commercial and residential real estate over the last several years. Following a number of recent deals announced there, Kilroy Realty has now made a move of its own on an R&D asset located at 1290 Terra Bella Ave., for which it paid close to $55,415,000, according to public documents. Kilroy confired the purchase but declined comment and informed The Registry that the company would not provide a release on the acquisition.
The 113,000 square foot building was sold by Embarcadero Capital Partners.[contextly_sidebar id=”dl4xV2zPlghp7kTNoejF6YCYwCWvsDJb”]While Kilroy has publicly stated its intention in the Bay Area is to invest in heavily-populated and high density, urban environments, the appeal of this asset’s access to major regional roadways and proximity to one of Bay Area’s largest tenants and most significant employers likely weighted toward the company reconsidering this suburban location.
According to a recent, first quarter of 2016 Silicon Valley Research & Forecast Report from Colliers International, the R&D market in Mountain View saw 3.3 percent vacancy, behind Cupertino, Los Gatos and Palo Alto, as well as the second highest asking lease rate of $3.40 (only behind Palo Alto, and well above the Silicon Valley average of $1.85).
All asset classes in Mountain View have had a slew of news announced in recent months. Google, which has been amassing real estate assets over the last few years in its home town at a steady clip, just a month ago purchased two buildings totaling roughly 36,000 square feet for $18 million. While this purchase alone may not be as significant, the search giant now owns the entire section of the neighborhood with 12 assets tied up since 2013.
In March of this year, Washington, D.C.-based The Carlyle Group and Tysons Corner, Va.-based US Bank have funded the nearly $100 million office building development located at 1001 North Shoreline Blvd. in Mountain View. The developer of the project is San Francisco-based Calvano Development. The site totals 7.5 acres, and it took Calvano Development four years to assemble the land for this project. The office building totals 111,443 square feet, all of which will be occupied by Google in a long-term lease.
Residential sales of multifamily assets have also been brisk with Oakwood Worldwide paying $110 million, or just over $738,000 per door late last year for a newly constructed 149-unit multi-family apartment complex in Mountain View. Oakwood partnered with Singapore-based Mapletree Group in a joint venture on this transaction.
And last, but not least, Silicon Valley-based Shashi Group purchased the 160-room Hilton Garden Inn Mountain View in January of this year for $74 million, or $462,500 per room, showing that an interest in all classes of property is real and will likely continue to put this city at the top of the list for investors looking to make a mark in Silicon Valley.