By Meghan Hall
The office sector continues to remain vibrant during the third quarter, and investor interest in key, tech-oriented assets remains strong as seen in a recent transaction that includes an office building currently leased to Google. In a deal that closed on Thursday, Los Angeles-based Preylock Real Estate Holdings purchased a four-story office building at 620 National Ave. for $190 million, or about $1,258 per square foot, according to a closing announcement from Colliers International. The seller of the property was National Avenue Partners, LLC, based in Los Gatos, Calif., according to public property records.
Google is the sole occupant of the 151,000 square foot building, who originally took the building in 2018 and is expected to lease the site through May 31, 2029 with 3 percent annual rent escalations, according to the offering flyer. The property hit the market in March of this year, and Colliers International and JLL were selected as the exclusive advisors. The Colliers team was led by Andy Zighelboim, Bob Gilley, Kevin Moul and Brad Idleman. JLL’s team was led by Will Connors, Erik Doyle, Daniel Renz, Rob Hielscher and Nick Deaver.
The property sits on a 4.83-acre lot and it is a four-story building with 422 parking spaces (316 in a parking garage and additional 106 open surface). The asset is surrounded by other technology firms, including Symantec, Samsung and Synopsys, although most of the surrounding buildings are occupied by Google, according to the flyer.
The National Ave. property is located blocks from the Googleplex, the firm’s main headquarters, and according to previous reporting done by The Registry, is the first asset with Google tenancy to be offered for sale following the project’s delivery. While the Bay Area has seen more than 27 million square feet of office and research and development property constructed since 2007, only 13 of those had been offered for sale as of March. Since 2010, The Registry reported, only three assets had been sold with investment-grade credit tenants in a building that is brand-new construction.
Based in Los Angeles, Preylock has been working extensively to expand its presence throughout the San Francisco Bay Area. The firm purchased the six-building Central Park Plaza campus from Dallas, Texas-based Transwestern Investment Group in San Jose for $83.3 million, or roughly $233 per square foot, in September 2018. The properties compose roughly 308,000 square feet of space. Prior to the September transaction, Preylock had spent $240 million on a seven-building Santa Clara portfolio in December of 2017; the properties were acquired in partnership with Hollywood director and producer Ivan Reitman. The seller of the portfolio was DivcoWest.
Since its founding in 2016, Preylock has come to acquire and manage over $1.25 billion worth of commercial real estate assets. The firm targets core-plus and high quality, stabilized properties in major markets along the West Coast.