Google Buys 8 Sunnyvale Office Buildings from NetApp for $250M

NetApp, Inc., formerly Network Appliance, Inc., has agreed to sell eight buildings in the Sunnyvale's Moffett Park business district to Google for $250 million, according to documents filed with the SEC. The court filings also reveal sale-leaseback plans as NetApp will continue to lease portions of the property. NetApp announced this month that it would be cutting 376 Sunnyvale jobs by the end of April. The sale of the eight properties is slated to be completed by April 22.

"NetApp has committed to a restructuring and reduction in workforce to streamline its core business and reduce operating costs," NetApp said in a recent filing with the Securities and Exchange Commission.

The eight buildings totaling 569,000 square feet include:
— 1299 Orleans Drive, 46,000 square feet
— 1277 Orleans Drive, 42,624 square feet
— 1260 Crossman Avenue, 95,464 square feet
— 1240 Crossman Avenue, 125,648 square feet
— 549 Baltic Way, 110,160 square feet
— 641 Baltic Way, 88,320 square feet
— 611 Baltic Way, 43,472 square feet
— 633 Caribbean Drive, 43,372 square feet

Potentially, 3,000 Google employees could work in the eight Sunnvale buildings, which is one of the high-priority expansion zones for Google. "This is a lot of space they are taking in Sunnyvale, and Google's goal appears to be to acquire as much as they can in this area," said David Vanoncini, managing partner with the San Jose office of commercial realty firm Kidder Mathews.

"People like to talk about the impact of startups, but really it's the big companies in Silicon Valley that are growing and creating the most jobs," added Stephen Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy. "You will always have some churn among the second- and third-tier tech companies, but the big companies are the ones that dominate this area. [...] The big players are the ones that will really determine how the region grows and prospers. And because of companies like Google, Apple, Facebook, LinkedIn, eBay, Intel and Oracle, the recovery and expansion in Silicon Valley is in good hands."

For more news and information visit Blumberg Partners.

Clarion Buys Pacific Tech Park

An affiliate of New York-based Clarion Partners purchased the Pacific Technology Park in Sorrento Mesa, California in a $90 million deal arranged by Cushman & Wakefield. According to a San Diego Business Journal article, the sellers of the industrial property, at 9389-9477 Waples St., were Pacific Tech Property Inc. of San Diego and San Francisco-based Deutsche Asset & Wealth Management. The sellers were represented by Jeff Chiate, Jeffrey Cole and Edward Hernandez of Cushman & Wakefield; and Mickey Morera and James Duncan of Kidder Mathews; Clarion was self-represented.

"This offering generated a great deal of interest," Jeffrey Cole told GlobeSt.com. "Clarion Partners was attracted to this opportunity to own a class A industrial park with credit tenancy in a coastal market. With the acquisition, Clarion also has the potential to further improve certain suites to re-lease to creative office and technology tenants at significantly higher rents."

The five building, office/corporate headquarter, R&D, warehouse business park is centrally located in San Diego's Sorrento Mesa Submarket, just east of the Interstate 805 Freeway. Pacific Technology Business Park was built in 1989-1991 and was 80% occupied by 13 tenants at the time of sale.

For more news and information visit Blumberg Partners.

Dermody Bringing New Logistics Center to Vancouver

Dermody Properties, a Nevada-based national industrial real estate development and operating company, recently broke ground on a new industrial facility in Vancouver, Washington that is expected to be completed in July 2015, and Vancouver's first new industrial development in more than 10 years. The 98,400 square foot facility, known as LogistiCenter 205, will be marketed by Tony Reser, Tom Talbot and Scott Murphy of Kidder Mathews, hoping to draw tenants from manufacturing and the high-tech sector, said Phil Wood, the Dermot Properties' Northwest regional partner.

"Vacancies in both the Vancouver submarket and the overall Portland market are at or near historic lows," said Douglas Kiersey, Jr., president, Dermody Properties. "LogistiCenter 205 will provide much needed modern distribution space to serve our national target customers."

LogistiCenter 205 will be one of the few sizable industrial facilities available in the Clark County submarket. The vacancy rate in the Clark County submarket was 3.7 percent at the end of 2014, the lowest rate experienced in recent history. Designed by Mackenzie and constructed by Perlo Construction of Portland, the facility will feature 30' clear height, a 130' truck court and Early Suppression, Fast Response sprinkler systems. LogistiCenter 205 will be the only Class A industrial facility available in the Vancouver Clark County submarket.

For more news and information visit Blumberg Capital Partners.

Manchester Buys F.X. McRory Building

The F.X. McRory Building, a turn-of-the-century building in Seattle, traded hands this week as Manchester Capital Management paid nearly $17.55 million for the property. The seven-story building at 419 Occidental Ave. S. was sold by Intracorp which previously purchased the building in 2007 for roughly $17.1 million; Goodman Real Estate had acquired the property three years prior to that for $8.5 million.

The property generated strong interest among buyers, according to comments from Kidder Mathews senior vice presidents Dave Speers and Andy Miller, the commercial real estate brokers who marketed the building for sale, in a Puget Sound Business Journal article. "We had well over 100 [potential buyers] registered, and we did over 40 tours, which is a personal record for us," said Speers, who has been in the real estate business 27 years.

The 85,725-square-foot brick building was built in 1906 for the Stewart and Holmes Drug Company and renovated in 2006, featuring large fir beams and exposed brick interiors. Just steps away from both Century Link and Safeco Fields, the property is home to the iconic FX McRory's Restaurant and Bar and includes 5 floors of office space above the restaurant. The building was 98% leased at the time of sale, according to Kidder Mathews.

For more news and information visit Blumberg Capital Partners.

Amazon Grabs More Seattle Space

The online retail giant Amazon.com continues to grow in Seattle as it takes another 150,000 square feet of space at 1800 Ninth Avenue, an office building owned by Talon Private Capital, according to a Kidder Mathews report. Amazon has been a titan in the Seattle real estate market in recent years, buying three city blocks from Seattle's Clise family in January of last year to build a 3.3 million square foot office complex, then following that acquisition nine months later by purchasing the South Lake Union headquarters campus it had been leasing from developer Vulcan Real Estate. It's also rumored that Amazon will be leasing 136,000 square feet of space in Metropolitan Park North at 1220 Howell Street.

"Amazon is the undisputed heavyweight champion of downtown Seattle," said Kip Spencer, president of The Spencer Companies, a Seattle real-estate consulting firm.

"In the 25 or 30 years I've been around downtown Seattle, I've never seen anything remotely like what Amazon has done to the market," says Dale Sperling, former president and CEO of Seattle's Unico Properties.

A joint venture of Talon and Prudential Real Estate Investors bought 1800 Ninth in December 2011 from Regence Blue Shield, which leased back about 30% of the space. The 1800 Ninth building is about three blocks from the nearest building Amazon already occupies.

For more news and information visit Blumberg Capital Partners.

Apple Picks Up More Than 1 Million SF in Sunnyvale

Technology giant Apple has made moves in Sunnyvale, CA, picking up more than 1 million square feet of new office space that could accommodate as many as 5,000 employees. As the company continues to outgrow its space in Cupertino, Apple continues to lease new space and has, so far, agreed to lease a total of 1.2 million square feet in Sunnyvale according to city records and real estate brokers involved in the deals.

"It's a remarkable growth spurt for Apple," said Jim Beeger, senior vice president with Colliers International, a commercial realty brokerage, in a San Jose Mercury News article. "This is a 30-year-old company undergoing the type of explosive expansion that you see with a three-year-old startup."

"Cupertino is pretty much filled up because of Apple's growth, much like Mountain View is pretty much filled up because of Google," said Phil Mahoney, an executive vice president with realty firm Cornish & Carey Newmark Knight Frank. "Both Google and Apple need more room. Both of them decided to find space in Sunnyvale."

"As I look at my iPad and check my iPhone, it really strikes me how much Apple has been able to achieve and how they have remade themselves," said Reed Payne, an executive vice president with Kidder Mathews, a commercial realty firm. "The future is not only bright for Apple, but the future bodes well for all of Silicon Valley."

For more news and information visit Blumberg Capital Partners.

BH Properties Sells Sunset Corridor Office Buildings for $6.9M

Los Angeles-based BH Properties, a real estate investment firm, has sold two Hillsboro, Oregon office and technology buildings known as Technology Center One and Two, totaling 95,000 square feet, for $6.9 million. According to an OregonLive.com article, BH Properties purchased the buildings in 2007 for $8 million. Hawaii-based Watumull Properties Corp. bought the properties, though terms of the deal were not disclosed. Keith Young, senior vice president at Kidder Mathews, represented both the buyer and the seller in the transaction.

Near the Intel Corp. campus, Tech Center One and Two are located at 7431 & 7451 NW Evergreen in Hillsboro. The property, constructed in 1985 with an addition in 1993, is occupied by a single tenant, Bank of America. "This is an impeccably constructed and maintained property, positioned in an economically diverse community, in proximity to a major metropolitan market, meeting Watumull's criteria for investment-grade properties," said Cliff Finnell of Kidder Mathews. "This building is highly desired by a wide variety of tenants, and will only increase in value over the next few years."

For more news and information visit Blumberg Capital Partners.