A New York real estate investor has flipped a Sunnyvale office campus it leased to Facebook parent Meta Platforms for $707 million, double what it paid a year ago.
Tishman Speyer sold the 719,000-square-foot complex at 1275-1395 Crossman Ave. that it bought last April for $356 million, Bloomberg reported, citing unidentified sources. It leased the campus to Meta last December in what’s considered the largest private-sector office lease of 2021.
The buyer was CommonWealth Partners, a Los Angeles-based investment firm with $10 billion in real estate assets across the U.S. In December, CommonWealth paid $1 billion for the Hudson Commons office building in what was New York’s biggest investment sale since 2019.
The former NetApp campus near the corner of Crossman Avenue and Caribbean Drive in northern Sunnyvale consists of four office buildings, two parking structures and recreational space known as Moffett Green.
Amenities include a gym with basketball court, sand volleyball court, bocce ball courts, a putting green, executive briefing center, data center, theater, full-service cafeteria, multiple kitchens, vegetable garden, break centers and phone rooms.
The lease to Meta countered gloomy predictions that tech firms would flee Silicon Valley and allow employees to work remotely rather than return to their offices.
“The sale and the lease demonstrate that Silicon Valley remains a global center of innovation,” Tishman Chief Executive Officer Rob Speyer said in the statement. “Moreover, this deal demonstrates that the market for highly collaborative, well-designed office space with accessible green space and top-level amenities is still strong.”
The latest deal allows CommonWealth Partners to expand its footprint around Sunnyvale to more than 1 million square feet.
“The acquisition of a top-quality asset in this dynamic submarket that has become a hotbed for expansion by Google, Amazon, Meta and other high-credit tech companies diversifies our portfolio’s tenant mix and reinforces our commitment to being a leading provider of high-quality office space in the region,” CommonWealth CEO Brett Munger said in the statement.
Tech companies have been among the most aggressive renters of US office space even as many employees continue to work remotely.
Office use in Silicon Valley’s San Jose area was 32 percent, compared with a 41-percent US average, according to data from Kastle Systems for the week through June 1.
The office-vacancy rate in Silicon Valley was 15.2 percent in the first quarter, according to Jones Lang LaSalle. “As companies reopen, an uptick in leasing activity is anticipated,” the brokerage reported.
[Bloomberg] – Dana Bartholomew
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