By Meghan Hall
A fully-leased office asset in Santa Clara has been sold, signaling that investor appetite for well-positioned assets in Silicon Valley remains high. In a deal that recorded on May 25th with the Santa Clara County Recorder’s office, LBA Realty spent $45 million, or about $426 per square foot, on 3300 Olcott Street. The seller was San Francisco-based PSAI Realty Partners.
LBA Realty purchased the property in all cash. PSAI Realty had originally acquired the property in June of 2018 for $38 million.
The building totals 105,664 square feet and sits on 6.73 acres of land. The property is leased to Palo Alto Networks, who has subsequently sublet 100 percent of its space to Gigamon, a privately held network visibility and traffic monitoring vendor. The firm uses 3300 Olcott as its world headquarters.
3300 Olcott features 52,000 square foot floor plates that can accommodate both single- and multi-tenant accommodations. The property was also outfitted with a high-end common area and tenant finishes, a “dramatic” lobby entrance, lab space,and state-of-the-art building systems, according to a previously circulated offering memorandum by HFF. The building was “extensively” renovated in 2009, with previous ownership investing $3 million, or about $28 per square foot into the building. Palo Alto Networks tenant improvement allowance came to about $5 million, while Gigamon invested an additional $1 million on their build out.
Located just off of Highway 101, a number of other major employers are nearby. Intel has offices just across the freeway, and Applied Materials, AMD Inc. and couchbase are all also located nearby. Santa Clara Square, a mixed-use office, retail and residential development, is just blocks away.
33300 Olcott’s new owner, LBA Realty, currently owns and operates more than 10 million square feet of space across major western U.S. markets. The company targets a variety of buildings, from high-rise class A offices to low- and mid-rise buildings, according to its website. Its other Bay Area assets include NorthTown, in San Jose, and the El Dorado Hills Business Center, near Sacramento.