Parts of Mountain View complex sell
Two parcels at The Village sell for more than $600M
A big chunk of The Village at San Antonio Center in Mountain View has been bought by a major investment firm with a nationwide reach in a deal worth more than $600 million.
The Los Angeles office of Brookfield Properties, acting through an affiliate, has bought two parcels near the corner of San Antonio Road and California Street, according to Santa Clara County property documents filed on March 30.
The parcels include two big office buildings that have been leased to Facebook, a building that includes the Showplace ICON Mountain View movie complex with 10 screens, and a parking structure, county public records show.
Brookfield Properties paid $630 million for the buildings and garage, according to property records on file in Santa Clara County.
The seller was an affiliate controlled by San Francisco-based
Merlone Geier, a real estate firm that in recent years has undertaken a wide-ranging and dramatic redevelopment of an old shopping center at that location.
“This center is a really transformational development that has evolved over the last decade or so,” said Eric Fox, an executive managing director with Cushman & Wakefield, a commercial real estate firm. “It went from only a shopping center to become a true hub for major tech companies and their employees. It is a first-class development.”
Brookfield’s acquisition of the two parcels appears to be the largest property purchase, by the amount paid, so far this year in Silicon Valley.
“Brookfield certainly has the capability and the wherewithal to make such a sizeable investment,” Fox said.
The transaction also suggests that investors continue to be highly confident in the Silicon Valley economy and real estate market, even after a year of coronavirus-linked uncertainties.
“Most investors realize that Silicon Valley is going to rebound a lot quicker than most markets,” said David Sandlin, an executive vice president with Colliers International, a commercial real estate firm. “That is the reason investors are willing to put their money here right now.”
Facebook occupies the two office buildings, at 391 San Antonio Road and 401 San Antonio Road, involved in the purchase. Together the two office buildings total 457,000 square feet. The 391 San Antonio office building totals 239,000 square feet, while 401 San Antonio totals 218,000 square feet.
Among the properties that aren’t involved in the recent purchase: much of the retail portion of the center, a large residential development, and a Hyatt Centric hotel.
“The property is located less than a half-mile from the San Antonio stop of the Caltrain system, providing easy access through the West Bay from San Francisco to San Jose,” Fitch, a finance rating service, stated in an assessment of the property deal.
Fox believes the location of the center will make it a prime property for decades to come.
“Whether it is Facebook or someone else in the distant future, this will continue to be a site that is of central importance and value in the market,” Fox said.
Investors believe that the huge numbers of offices in Silicon Valley that have been largely unoccupied during the year-long business shutdowns due to the coronavirus won’t remain deserted indefinitely, according to real estate experts.
“Silicon Valley will be going back to work in offices as we emerge from COVID,” Fox said. “You are seeing more announcements from Google, Amazon, and Facebook that have mentioned plans to return to work. Silicon Valley tech companies have broken the seal on the notion that offices would remain closed for the foreseeable future. The opposite is true.”
More major property purchases are in the works in Silicon Valley and elsewhere in the Bay Area, real estate agents say.
“There will be more large deals,” Sandlin said. “There are several properties that are up for sale now that will transact. And the sellers will get the numbers that they are looking for.”