While commercial real estate demand in the Silicon Valley remains low in comparison to pre-COVID levels, developers are finding fruitful opportunities predominantly in the way of industrial and affordable housing. The latter comes as no surprise granted the median home value in the Valley sits above $1.1M.
What’s New?
Acquisitions have been rampant in the last 6-months. Just this month, Tishman Speyer sold its 720,000 square foot office campus located in Sunnyvale to CommonWealth Partners for $707M - roughly $300M more than they purchased it for 18-months ago and prior to Meta signing a lease on the property.
Westbank and Urban Community are teaming up on a $1B + mixed use project in San Jose dubbed The Orchard. The hefty project includes two office towers offering a combined 1.3M square feet of office space as well as a residential tower comprised of 540 residential units & 5,491 square feet of retail space. Such an addition of housing units should, in theory, contribute heavily to the desired outcome of greater affordability within the greater Silicon Valley.
NY based Clarion Partners have proposed a 6-building, ~490,000 square foot industrial project situated in Fremont. The vacant 30-acre lot was purchased from developer John Arrillaga for an estimated $123M last year.