Brocade Acquires North First Street Land in San Jose for Office Park
May 27, 2008
Brocade, in an SEC filing dated today indicated that it has acquired land on North First Street for the construction of a 562,000 SF office project. We were previously the first to report on April 4th that Brocade was in negotiations to lease the project, however; as it turns out the transaction actually involved a sale of land and subsequent development agreement for the construction of the buildings and parking garage.
The agreement which was inked on April 24th between Brocade and MFP/Hunter@First Office Partners LLC (Hunter Storm Development of Cupertino and MacFarlane Partners out of San Francisco) consists of a sale of three unimproved parcels that are entitled for approximately 562,000 square feet of space in three buildings. The total purchase price for the property is $50.9 million.
In connection with the purchase, Brocade has engaged MFP/Hunter@First Development Partners, LLC as development manager to manage the development and construction of the office buildings on the property for approximately $173 million which covers the construction of the three buildings and parking garage.
Brocade also obtained a four-year option to purchase a fourth unimproved approximate 4 acre parcel for a fixed price of approximately $26 million.
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Tags: @First Office Park, Brocade, Class A, Commercial Development, Commercial Real Estate, Hunter Storm, North San Jose, Office Space, San Jose
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Anyone know the basis for MFP in this JV?
JP,
Our understanding is that MFP/Hunter acquired the property for $70M from Palm. Brocade acquired a portion of it as noted above for $50.9M, and acquired a right to an additional 4 acres for $26M.
In exchange, Hunter/Storm will develop the site for Brocade for about $173M. Brocade is essentially financing the construction through progress payments over 2 years.
Hunter/Storm is developing an additional 71,135 SF of retail space and a Hotel Sierra on a 9.8 acre portion of the original parcel as well.
Can you confirm that Brocade is represented by Studley’s Corporate Services Group?
Can you provide contact infomation?