Moffett Towers Might Finally Be Getting a Tenant
September 22, 2008
Things haven’t gone as planned for the Moffett Towers project in Sunnyvale. Since being substantially completed in late 2007, the 1.8 million square foot (when all completed) project has sat empty waiting for a tenant. The landlord reduced rental rates from $3.25 NNN to $2.95 NNN some time ago, and still has no big deals to announce.
That might be changing. We hear they are working on trying to secure Sony for 300,000-400,000 square feet. No telling what the economics of the deal are, but it will likely involve a generous tenant improvement allowance as the developer, Jay Paul Company, seeks to get some cash flow going to offset what is likely some pretty ugly interest payments due on the project.
It is hard to tell what other developers are thinking in the face of what could be a more difficult economic reality as a result of all the troubles in the financial markets right now. Developers such as Menlo Equities, Sand Hill Properties, RREEF, and Legacy Partners have all engaged in speculative development in this cycle and together are in various stages of construction or delivery on a combined several million square feet of in the South Bay; and aside from the Hunter Storm/Brocade deal, none has had any good news to report. Perhaps Jay Paul will have something good to share soon.
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Tags: Brocade, Hunter Storm, Jay Paul, Legacy Partners, Moffett Towers, RREEF, Sand Hill Property, Sony, Sunnyvale
That’s interesting if it is indeed Sony. They were in San Jose (Zanker Road) until recently, and they moved out allowing that building to be converted to housing. I seem to recall part of the agreement allowing for the rezoning of the Zanker Road property was for them (Sony) to stay in San Jose. Moffett Towers is not in San Jose!