In the company's public release of Q1 2016 results, Boston Properties disclosed the acquisition of 3625-35 Peterson Way in Santa Clara, California for approximately $78 million in cash. Boston Properties purchased the 15-acre site from Eaton Vance Management, a wholly owned subsidiary of Eaton Vance Corp., which paid $53 million (or $243 per square foot) for the property in March of 2008. The deal was facilitated by Eastdil Secured, but terms were not disclosed.
Originally built in 1979, the 218,400-square-foot building flex building has office, laboratory and warehouse space located 10 minutes from the Norman Y. Mineta San Jose International Airport. The property was 100% leased at the time of sale to Spectra-Physics, a manufacturer of semiconductor-based lasers and laser optics (and a subsidiary of Newport Corp.) that moved its headquarters to Peterson Way in 2009; the lease does not expire until March 2021. Boston Properties indicated that after the lease is up, it plans to develop the site into a Class A office campus containing an aggregate of approximately 632,000 net rentable square feet. The projected cost for the future development is around $700 per square foot, and the expected initial return once the project is finished is 7%.
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