By Meghan Hall
Peninsula Land & Capital, a Palo Alto, Calif.-based investment firm, has purchased several high-tech and research & development buildings across the Bay Area in a deal struck with DRA Advisors. The deals include assets in San Jose, Fremont and Milpitas and total $165 million.
According to The Mercury News, who first reported the deal, Westcore also partially owned the assets alongside DRA Advisors, who currently has $11.2 billion in gross assets under management. CBRE represented a fund managed by DRA Advisors in their sale of the portfolio to Peninsula Land and Capital.
“This was a great opportunity for a fund managed by DRA Advisors to sell seven buildings in one transaction and for Peninsula Land and Capital to acquire a highly desirable R&D/flex portfolio in Silicon Valley”, said CBRE’s Scott Prosser.
In the largest transaction, Peninsula Land & Capital purchased several buildings at 6311 to 6351 San Ignacio Ave. in San Jose. The firm paid $87.7 million for six buildings. Data released by CommercialCafe indicates that the Class B campus totals around 331,000 square feet. Also in San Jose, Peninsula Land and Capital purchased an 80,600 square foot building for $23 million.
In the next deal, Peninsula Land & Capital spent $23.3 million for 223 to 237 S. Hillview Dr., in Milpitas. Together, the buildings are about 100,000 square feet in size.
In Fremont, the firm acquired 3481 and 3501 W. Warren Ave. for $16.7 million, as well as 2800 Bayview Drive for $14.5 million. The Warren Ave. assets total 68,700 square feet. 2800 Bayview Drive is a single-tenant, Class B property constructed in 1985. According to CommercialCafe, the property totals 59,052 square feet.
All of the buildings accommodate advanced manufacturing and R&D uses. According to CBRE, the entire portfolio totals 585,478 square feet of space. The portfolio was 94 percent leased at the time of sale to seven tenants. The remaining weighted average lease term is about 7.6 years.
In recent weeks, a number of office and R&D assets have sold across the Bay Area. Berkeley Partners purchased 2121 and 2125 Zanker Rd. a 54,000 square foot campus, for about $24.5 million. Paceline Investors purchased multiple assets on Harbor Bay Parkway and S. Loop Rd. in Alameda for $69.3 million. In Hayward, the Mt. Eden Research Park, another life sciences and R&D campus, traded for $155 million to GI Partners.
The transactions show building momentum in the market, and that investors are more than willing to take advantage of the Bay Area’s property fundamentals. Competition for such properties continues to be competitive as the outlook for the sector remains rosy.