SAN JOSE — A big — and empty — research and development building in north San Jose has been bought by an investor with properties on three continents, an indication that investors still hunger for Silicon Valley real estate despite the coronavirus uncertainties.
Exeter Property Group, which has $2 billion in properties owned or under management worldwide, has bought a vast building at 1710 Automation Parkway in San Jose which is vacant after its previous tenant, Western Digital, exited the site.
Brokers Steven Golubchik, Edmund Najera, Darren Hollak, and Jack Phipps with the Capital Markets unit of commercial real estate firm Newmark Knight Frank arranged the building purchase.
“1710 Automation is ideally located within proximity to some of the world’s most prominent technology companies,” said Najera, a vice chairman with the Capital Markets group.
Exeter Property paid $36.2 million for the building, which totals 197,000 square feet. Soma Capital Partners and Atlas Real Estate Partners sold the property.
Over the last two years, rents for research and development buildings in this section of Silicon Valley have risen 12 percent, far ahead of the general inflation rate.
The sellers recently completed a wide-ranging renovation of the building, which would also be suitable for advanced manufacturing endeavors.
The building also is fairly close to the BART stations in both Milpitas and San Jose’s Berryessa district.
Although leasing activity has slumped in the Bay Area due to coronavirus-linked economic uncertainties, Newmark Knight Frank believes Silicon Valley is poised to rebound strongly.
“As the economy begins to recover, Silicon Valley is anticipated to recover faster than other urban markets,” Newmark Knight Frank said.