Tishman Speyer and Google now share giant block in choice Silicon Valley district
SUNNYVALE — Tishman Speyer’s mega-deal to buy several Sunnyvale buildings from NetApp gives the veteran developer control of several sites in a prime section of Silicon Valley and makes it a neighbor of search giant Google.
In one of the largest Silicon Valley property purchases so far this year in 2021, Tishman Speyer paid $365 million for seven parcels in northern Sunnyvale. The NetApp property transaction in Sunnyvale occurred simultaneously with the tech company’s lease of a big new headquarters office in San Jose’s prestigious Santana Row complex.
The just-bought Tishman Speyer properties in Sunnyvale contain four big office buildings, two parking garages, and a large common area that includes gathering spaces, recreation amenities, and surface parking.
Both Tishman Speyer and Google now own broad swaths of property that give both owners plenty of flexibility to chart the future of their respective sites.
The seven parcels that Tishman Speyer now owns through two different affiliates feature office buildings totaling 702,200 square feet on a 21.5-acre property.
Google owns eight adjacent parcels totaling 27.9 acres that include four office buildings, a big chunk of land, and expansive surface parking areas.
The combined 49.4 acres that Tishman Speyer and Google own are bounded by Crossman Avenue, East Java Drive, Geneva Drive, and Caribbean Drive.
Google is believed to be planning a long-term redevelopment of the site that it owns on this giant block of properties. The company hasn’t formally discussed its plans on this block, although the tech titan is moving to redevelop other properties in northern Sunnyvale.
Tishman Speyer intends to find one or more tenants to lease the buildings that it has just purchased. Brokers Joe Brady, Michael Drew, Peter Hamann, and John Brady of commercial real estate firm Savills arranged the Tishman Speyer purchase of the NetApp properties in Sunnyvale, as well as NetApp’s simultaneous lease in San Jose’s Santana Row.
This location is deemed to be one of the prime spots for a tech campus in Silicon Valley.
“There are a lot of big technology companies in the Sunnyvale area that own or lease a lot of big blocks of space,” said Hamann, an executive managing director with Savills, a commercial real estate firm. “Tishman Speyer owns a Class A, ready-to-occupy campus right in the middle of Sunnyvale.”
The sizes of the four buildings that Tishman Speyer bought from NetApp, according to the Santa Clara County Assessor’s Office:
— 1395 Crossman Ave., 189,700 square feet
— 1375 Crossman Ave., 189,800 square feet
— 1345 Crossman Ave., 189,700 square feet
— 1275 Crossman Ave., 133,000 square feet
The portion of the Sunnyvale block that Tishman Speyer bought features numerous amenities: outdoor recreation areas, a gym with a basketball court, lockers, showers, an outdoor volleyball court, an executive briefing center, a full-service cafeteria, multiple kitchens, break centers, phone rooms, and other common areas.
“The buildings are all ready to go for a tenant,” Hamann said. “All of the interiors have been kept up immaculately by NetApp over the years.”
The northern Sunnyvale area is one of the long-standing tech hubs of Silicon Valley. Originally a district with many one- and two-story research and office buildings with huge parking lots, part of the region has undergone a dramatic transformation symbolized by modern office buildings. More changes are contemplated, including homes.
Veteran and savvy developer Jay Paul Co. a decade ago was the first major real estate firm to see the potential for northern Sunnyvale as a center for brand-new offices, taller buildings, and game-changing tech company expansions.
“When Jay Paul developed all those office buildings, people thought he was crazy,” Hamann said. “But look at how the area has changed.”
Google, Facebook, and Amazon, either through property purchases or office leases — in Google’s case, both — all have taken at least 1 million square feet of office space in northern Sunnyvale.
“A lot of big companies could be interested in the buildings that Tishman Speyer bought,” Hamann said. “You would think that Google at least has some interest in the buildings. Google could come along and take it all.”
SOURCE: THE MERCURY NEWS
