Silicon Valley tech campus sold in mega real estate deal

Silicon Valley tech campus sold in mega real estate deal
Photo Credit: Lane Partners
By Wesley Severson - Published on August 02, 2021.

A real estate investment firm based in New York City has just purchased a huge tech campus in North San Jose that contains three large buildings near Highway 237 and North First Street. The name of the 603-thousand square-foot office campus is HQ @ First and it is currently being occupied by semiconductor company Micron and cloud security firm Zscaler.

‘KKR Real Estate Select Trust Inc.’(KREST) is the purchaser and announced the sale via a press release early Monday morning. The sale came with a price tag of $535 million which also includes an adjacent parking garage, according to Mercury News. Japanese real estate investor Mori Trust paid $429 million for the property in 2019 and according to Silicon Valley Business Journal, the property has almost doubled in value in the span of nearly five years.

"HQ @ First is a marquee property with great amenities, including onsite lab facilities, and access to Silicon Valley’s immense pool of talent. Well-located, trophy assets that can deliver a dynamic work environment for innovative growth, companies will have significant staying power and long-term value," said Justin Pattner with KREST in a statement about the buildings that have the addresses of 110, 120, and 130 Holger Way.

Commercial real estate firm Newmark arranged the deal. A statement by that company in 2017 describes some of the amenities on the property which include landscaped paths, sweeping views, patio and BBQ areas, a basketball court, fitness center, a game room, a 300-seat cafeteria, and a large executive business area. There is also a big shopping center nearby which has a Target and other popular shops and restaurants.

KREST released this statement on the First @ HQ purchase, "The investment is part of KREST’s prime single tenant investment strategy, one of the fund’s three primary investment strategies, which targets high-quality commercial real estate with long-term leases to single investment-grade tenants. The purchase grows the value of underlying properties in KREST’s portfolio to more than $1 billion and continues KKR’s focus on investing in attractive commercial real estate opportunities on the West Coast."