By Jon Peterson
San Francisco-based Swift Real Estate Partners has sold the 116,779 square foot office building in San Jose located at 6203 San Ignacio Avenue for $28.26 million or $242 per square foot, according to sources familiar with the property.
The buyer of the property was a private buyer that goes by the name of 777 Welch Partnership, a 1031 exchange buyer. The buyer in the transaction was represented by the San Jose office of CBRE. The listing agents on the sale included Joe Moriarty and Scott Prosser, both executive vice presidents, and Jack DePuy, senior associate. The team works out of the company’s San Jose office.
“6203 San Ignacio was a pre-fund purchase that Swift acquired approximately five years ago. The building was purchased at just 3 percent occupancy and subsequently leased to 100 percent. It was purchased with a capital source out of New York”, says Nate Carlson, an asset manager for Swift. He was involved in the sale of the asset.
The seller had acquired the property in the fall of 2012 for just under $100 per square foot or $11.4 million. At the time of its purchase, the State Compensation Fund had just vacated the property as it was vacating and consolidating offices throughout the Bay Area. “Swift was able to arrange a lease with San Andreas Regional Center to occupy two-thirds of the building on a long-term lease, which made this asset an attractive investment for a investor with a longer term horizon,” said Carlson.
The property now has no vacancies. The other tenants in the property include Regus, Guidewire and StarLight Community Services. This asset is considered to be a Class A building. It has a two-story lobby with surface and underground parking, and it is within close proximity to both VTA Light Rail and Caltrain.
“Swift viewed this property as one that offered tenants a Class A office experience at much lower rents than competing Downtown San Jose or West Valley office rates. Additionally, it offered the ability for tenants to give their employees the benefit of a reverse commute,” said Carlson.