Fortinet collects Sunnyvale property, signaling expansion

Tech company deals for city sites near its headquarters

SUNNYVALE >> Fortinet has bought a half-century-old commercial building near its headquarters in Sunnyvale, fresh evidence that the tech company is eyeing further expansion around its main campus.

The cybersecurity tech company, whose profits and sales are rising swiftly, has been busy collecting an array of sites in Sunnyvale next to and near its current headquarters at 899 Kifer Road.

The most recent purchase was an office building at 159 San Lazaro Road in Sunnyvale, according to documents filed with Santa Clara County officials on Feb. 12.

The building totals about 6,600 square feet, commercial real estate listing services show.

Fortinet paid $2.96 million for the building, according to public records.

The transaction was an allcash purchase.

It’s possible that the sellers harvested a hefty profit from the sale to Fortinet. The assessed value of the building was listed at roughly $743,000.

This is far from the only purchase by Fortinet in the area. From 2012 through early 2021, Fortinet spent $80 million buying up sites large and small in the vicinity of its current head offices.

In 2012, Fortinet paid about $25 million for its current headquarters at 899 Kifer Road in Sunnyvale. But that was just the beginning of the company’s property purchases.

The network security software and services firm is also constructing a modern office building at the northwest corner of Kifer Road and Commercial Street.

Fortinet does not break out its employee count in Sunnyvale. However, worldwide, the company’s workforce has expanded briskly of late.

At the end of 2019, Fortinet employed 7,082 workers worldwide. As of the end of September 2020, the company’s headcount was 8,075, an increase of nearly 1,000 workers, or 14%.

Profits and revenues also have grown at a robust pace.

In 2020, Fortinet earned $488.5 million on revenue of $2.59 billion. The profits in 2020 skyrocketed 49.6% from 2019, while revenue jumped 19.9%.

Sunnyvale-based Fortinet provided some brief details about the construction effort in a quarterly report filed in November 2020 with the Securities and Exchange Commission.

“Construction of a second building at our headquarters campus started in the fourth quarter of 2018,” Fortinet stated in the SEC filing. The company estimated that spending on the campus project in 2020 would be between $95 million and $105 million.

The coronavirus delayed the construction timetable, Fortinet stated in the document.

“We estimate construction to be completed in the first half of 2021,” Fortinet said in the regulatory filing.

Contact George Avalos at 408-859-5167.