Commercial Real Estate Blog

Hines is in contract to sell its Parkside Towers office complex in Foster City. The complex is roughly 400,000 SF and is reportedly being sold to Harvest Properties and Invesco for roughly $180M ($452 psf). The complex is about 80% leased and includes tenants IBM, Axciom, and QuinStreet.

 The project was purchased by Hines about two years ago from Equity Office Properties which built the project originally for Inktomi. Inktomi never occupied the complex and subsequently paid a $50M termination fee to get out of its lease.

I suspect after closing rents will move into the $40 NNN rent range and leasing agencies to be swapped from Cornish & Carey to possibly NAI BT Commercial.

Update (03/2008): The project was 99% leased at COE. A 91K SF lease to Rearden Commerce which was announced one day after the initial posting of this item brought the project up to 99% occupancy at the time of sale.

If the performance of the S&P Index during the first week of January is right again this year, the markets and the economy may be facing a bumpy ride ahead.

Below is the performance of the S&P 500 index over the last ten years; and 2008 has had the worst showing in a decade. We’ve been advising our clients to take a cautious approach and we believe that while the fundamentals in Silicon Valley remain strong, the pockets of weakness will expand and both tenants and investors should apporach any investment or lease with that in mind.