June 24, 2009
With development anticipated to be dead for at least 4-5 years, land has lost incredible amounts of value. Just two years ago, Dostart development paid some $60+ psf for a 15 acre site on East Middlefield Road. Two years later, the county has offered up a 3.6 acre piece next door to that site, and bids have come in as low as $10 psf. Bids came from Dollinger Properties, Peery/Arrillaga, South Bay Development, Barry Swenson, and DoStart Development, and none met the county’s expectations – they were either too low, or tied the property up for too long.
Nonetheless, the site is well-located, but unfortunately not suited for much except Office or R&D, and with today’s rental rates and the downward trend, the land has little value. The general anticipation is that things will get worse, and that there will be bigger and better opportunities down the line, providing little incentive for developers to pay anything but bargain basement prices.
Read the rest at The Registry
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