SAN JOSE — Citing “strong tailwinds” for the Silicon Valley economy, a London-based investment group has bought a vast South Bay real estate portfolio of dozens of office and research buildings in San Jose, Santa Clara and Milpitas.
The purchases by Lone Star Fund include its $195 million acquisition of a Santa Clara tech campus on Mission College Boulevard near Burton Drive and Wyatt Drive, documents filed on Aug. 31 in Santa Clara County show.
“We see significant opportunity in this portfolio given the strong tailwinds across the business landscape right now in Silicon Valley,” said Jerome Foulon, Lone Star’s global head of commercial real estate. “We have a high level of conviction in the resurgence of the Bay Area.”
Bay Area real estate firms TMG Partners and Grove will be the operating partners for the sites that Lone Star has agreed to buy.
Lone Star Fund said it struck a deal to acquire 2.2 million square feet across six campuses, 50 buildings, and 140 acres in Silicon Valley’s Golden Triangle, an area roughly bounded by U.S. Highway 101, State Route 237 and Interstate 880.
The research and office hubs that the Lone Star-led group bought consist of:
The 12-building Mission Park complex that totals 500,300 square feet on 33 acres. The site includes a data center that totals 73,000 square feet, a retail hub and a 175-room hotel that’s next to tech hubs occupied by Nvidia, Intel and Oracle.
Montague Square, a six-building campus totaling 251,200 square feet on 15 acres at Montague Expressway and North First Street in North San Jose.
North First @ Orchard Station, a six-building, 17-acre North San Jose site totaling 266,800 square feet with addresses that include 41 Daggett Dr.
Montague Oaks, an eight-building campus totaling 295,000 square feet on 18.6 acres with addresses ranging from 627 to 655 River Oaks Parkway in North San Jose. The campus sits atop a key fiber hub.
Zanker Place, a four-building office center totaling 142,000 square feet at 1920 Zanker Road. The Google Brokaw campus and the PayPal headquarters are nearby.
Tasman Tech Center, a 14-building office and research hub totaling 736,800 square feet on 47 acres in Milpitas.
The buying group headed up by Lone Star Fund also landed a $552 million loan in connection with the purchase of a portfolio that includes properties with research and development capabilities.
The lender was an affiliate of Invesco Real Estate, which is linked to a worldwide investment firm.
Other investors are jumping into the South Bay office market, including a $330.8 million purchase of an office building on Innovation Way in Sunnyvale that’s leased to Hewlett Packard Enterprise on a long-term basis.