As the Silicon Valley industrial market experiences a slight downtrend, former Goldman Sachs associate Kelly Ho swoops in to make a mark, acquiring a 130,000-square-foot manufacturing facility in San Jose for a staggering $38 million, according to The Real Deal. The purchase, linked to Ho Enterprises, a limited liability company, seems to underscore investor optimism in the potential of data center-driven real estate growth in the region, even amid less than favorable market conditions.

The San Jose property, located at 1980 Senter Road, was built in 1966, underwent significant renovations in 2022, and boasts prime access to highways 101, 237, and 87, not to mention being a mere seven minutes away from the Bart station. Given that the facility was sold for over double its appraised property value of $15 million, it appears that there's still some steam left in the Silicon Valley industrial market. The seller, Wyoming-based Exeter Way LLC, must be pleased with the roughly $291 per square foot price obtained in the deal.

Now, this might make you wonder why anyone would make such an investment when a recent report by Kidder Mathews suggests a cooling industrial market in San Jose. The availability rate for warehouse space increased from 3.7 percent in the fourth quarter of last year to 4.2 percent in the first quarter, and vacancy rates also crept up to 2.6 percent from 2.3 percent. Leasing activity saw a dramatic drop from 730,000 square feet in Q4 to just 173,000 square feet in Q1. But here's the silver lining: investors still have faith in the market because of the strong demand for data centers.

The same Kidder Mathews report states that "the Silicon Valley industrial market has not been immune to the economic downturn," but even in the face of reduced activity, data center clients are proactively seeking to acquire and adapt outdated industrial properties for their operations. It seems the promise of tech-driven growth is just too hard to resist for some investors. It's a prime example of how the tech industry can continue to provide opportunities even in a slow-moving market.

In fact, there have been a few noteworthy deals in the region lately, with the largest being Amazon.com's purchase of a 730,000-square-foot building in Santa Clara for $238 million, or $326 per square foot. Kelly Ho's recent transaction, while being second in terms of price last quarter, fell somewhere in the middle when it comes to price per square foot.

It's also worth noting that Ho is no stranger to the tech world, having worked for nearly eight years at Western Digital, a manufacturer of data storage devices. Her experience in the tech industry could have lent valuable insights into the property purchase, and it might not be surprising to see her turn a seemingly risky investment into a profitable one.