By Meghan Hall
A commercial property in a growing neighborhood in San Jose has traded hands. In a deal that closed last week, Sand Hill Property Company sold 3011 N. First Street for $28.9 million, or about $198 per square foot. According to The Mercury News, who first reported the deal based on public documents, the buyers were investors based in both the San Francisco Bay Area and Chicago.
The deal closed June 4th, and the buyers are affiliated with Blue Vista Capital Management and Cannae Partners. The Mercury News notes that it is possible that Blue Vista Capital Management and Canna Partners purchased the property on behalf of another major firm or entity. Blue Vista Capital Management and Cannae Partners also will assume a $21 million mortgage tied to the property.
Sand Hill originally paid about $31 million for the property back in 2015, when it was purchased from South Bay Development Company. The building totals 146,159 square feet and sits on 9.3 acres. The asset is also currently leased to Intermolecular Inc. a semiconductor and research and development firm. Intermolecular currently has several years left on its lease.
The property is located just off of the Montague Expressway, near a Safeway-anchored shopping center and minutes from Norman Y. Mineta San Jose International Airport. Also nearby are a number of other employers and commercial businesses, from Ebay to Oracle to Align Technology and Complete Genomics.
The property has traded hands at a time when the economy–and the wider state of California–is beginning to reopen. Employment has slowly started to recover, notes a market report from Cushman and Wakefield, but is still down year-over-year by 96,800 jobs. Unemployment at the end of the first quarter came to about 5.6 percent; however, this number is expected to improve once businesses open further.
Deal velocity within the market remained slow the first few months of the year but are gaining traction. Recent sales include the South Bay Tech Center in Milpitas to Intelli LLC for $35.5 million, or $212 per square foot. Hines purchased 5301 Patrick Henry Drive for $69 million, or about $579 per square foot, while Equinix has announced plans to establish a new, $142 million data center at its Great Oaks Campus in San Jose. The deals are a promising sign of the Silicon Valley market re-emerging after nearly a year of limited activity.