Tech titan lease renewals may spur Silicon Valley real estate rebound
Five big lease renewals top 1 million square feet of office space
Google, Amazon and Apple are among the high-profile tech companies that have decided to renew their leases in big office buildings, according to commercial property databases and several real estate sources.
Five known major lease renewals were large enough to account for a combined 1.13 million square feet of office space, the real estate databases show.
Here are the details of the lease renewals involving giant tech companies that have occurred so far this year:
— Google agreed to renew a lease at 1900 to 2000 Charleston Road in Mountain View for 411,200 square feet. The property is owned by development company Peery/Arrillaga.
— Amazon has renewed two Sunnyvale leases for a combined 581,000 square feet. These consist of renewals for 350,700 square feet at 1100 Enterprise Way and 230,300 square feet at 1050 Enterprise Way. The buildings are owned by development firm Jay Paul Co.
— Apple has agreed to a lease renewal at 5425 Stevens Creek Boulevard in Cupertino for 59,400 square feet.
— Sony has reached a deal to renew a lease at 1730 North First Street in San Jose for 79,900 square feet.
These deals, along with separate transactions involving purchases, offer a welcome counterpoint to the economic maladies that still afflict the Bay Area’s feeble office market in a post-coronavirus world.
On Sept. 22, Lam Research paid $250 million to buy three buildings in Fremont and two buildings in Livermore. Lam had been leasing the buildings already and the deal solidifies the Bay Area presence of the maker of semiconductor equipment.
On Sept. 9, an investment group from the Midwest paid slightly under $192.5 million for a five-building office and research campus in Milpitas. Western Digital, which sold the property to the real estate buyer, also immediately signed a lease to stay in the tech campus through 2039.
The property purchases and the lease renewals provided some of the few bright spots in an otherwise glum July-through-September third quarter for the Silicon Valley office market, according to a report released by Colliers, a commercial real estate firm.