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Commercial Real Estate Blog

Nokia in the Market with a 150K+ Square Foot Requirement

Nokia is in the market with a 150,000 square foot plus office space requirement. The requirement is in the Palo Alto, Mountain View, and Sunnyvale markets. Nokia currently leases approximately 130,000 square feet from Equity Office on Fairchild way on a lease that runs through June of 2009. The project was developed by Keenan-Lovewell in 1999 and the asset was sold to CarrAmerica (now Equity Office) in 2005 for approximately $407 psf ($54M).

Amongst the projects that Nokia has taken a look at is Jay Paul’s Moffett Tower project, which to date has had trouble finding tenants. Nokia would present a significant boost to the project.

Nokia leased the buildings during the height of the dot-com boom and has been paying an above-market rate since.

Google Puts 225,000 Square Feet of Palo Alto Office Space on the Market for Sublease… Again

Google (GOOG: 271.96 -7.17%) has once again put its building at 395 Page Mill Road in Palo Alto on the market for sublease. Since signing a 10-year lease for the 224,000 square foot building mid-last year from Jay Paul Company, the building has sat vacant. The building was acquired by the Jay Paul Company from Agilent Technologies in 2006 for approximately $425 psf ($95M). The three-story building was built in 2000, sits on 10 acres, features 3/1000 parking, and is also within walking distance of California Avenue amenities and the Caltrain station.

The term of the sublease runs through June 30, 2017. The space was offered for sublease by Google earlier this year for a short period of time before the space was pulled off the market. It was speculated that Facebook was interested in the building, but Facebook ended up leasing 137,000 square feet at 1601 California Avenue in August instead.

Gilead Sciences Acquiring Office Building and 30 Acres of Land in Foster City from EFI for $138M

Gilead Sciences (GILD: 43.40 -3.10%) has entered into contract to acquire 30 acres of land from Electronics for Imaging (EFII: 9.19 -5.94%) for $137,500,000. Gilead has put up $5M in earnest money and has until December 12th to remove contingencies.

The property being acquired is 301 Velocity way, which contains a 163,000 square foot building, and 30 acres of land entitled for office development.

Once Gilead removes the contingencies, it will have to close the transaction in January.

Back in August, Gilead revealed plans to double the office and R&D space at its Foster City headquarters as it sought to add some 1,900 jobs over the next 10 years and this land will allow them to do that.

The company’s intention is to start construction as early as next year.

A New Look and an Invitation to Comment

The blog has a new look! As the blog has grown we’ve tried to make it a bit more organized and user-friendly when it comes to aesthetics, functionality, and resources. We’ll continue to add features as time permits. Meanwhile, post a comment and let us know what you think or if you have any suggestions on how we can make the site even more useful to you.

Thanks

Yahoo! To Axe 1500 Employees By Year-End; Consolidate Facilities

Yahoo! released its Q3 earnings numbers today, and along with it announced plans for a significant headcount reduction by year’s end. Yahoo! currently employs about 15,200 employees. What is interesting is that even before these layoffs take place, Jerry Yang, Yahoo’s CEO, left the door open for additional cuts by indicating that “This is the first step in a longer term effort that will last into 2009 and beyond.”

In a separate interview, Blake Jorgensen, Yahoo’s CFO said that “We are going into what is very clearly a recession mode.” Yahoo’s layoffs come on the heels of an announcement by Ebay that it will be cutting about 1500 employees.

Jerry Yang also indicated in an internal email today that the company is seeking to cut costs elsewhere through relocation of employees and a consolidation of facilities. Yahoo! occupies millions of square feet of Silicon Valley office space. It maintains headquarters facilities in Sunnyvale on the north side of 101, and also occupies two seperate Sobrato projects at 101 and Great America Parkway and Mission College Blvd. In addition, Yahoo! purchased approximately 50 acres of land in Santa Clara a few years ago with the intention of developing a campus where it could consolidate all of its Silicon Valley operations. It’s very likely any plans they had for that land will continue to be shelved for some time to come.

Broadway Partners Deal to Sell One Sansome to Mirae Falls Apart

One Sansome Street

After having gone into contract with Broadway Partners about two months ago to acquire One Sansome Street, it appears South Korea-based Mirae Asset MAPS Investment Company has backed out of the $365M transaction. The 650,000 square foot building is leased in large part to Citigroup on leases which run for several more years.

We’ve heard that Mirae had even gone non-refundable on its deposit and lost that when it decided to walk away from the transaction. The failure of this deal likely does not bode well for Broadway Partners. We recently wrote about the fallout that they will likely face from the aggressive acquisition spree they went on over the past several years.

Thanks to readers DD and Deglazer for sharing.

Mervyn’s to Liquidate and Close; 3000 Northern California Employees Affected

With no more fight left in it, Hayward-based Mervyn’s has decided to shut its doors for good. The retailer will be closing all of its approximately 150 stores. In Northern California, Mervyn’s has more than 3,000 employees.

Locally, Mervyn’s has a retail presence in San Jose, Milpitas, Campbell, Morgan Hill, Santa Clara, Fremont, Cupertino, Mountain View, Newark, Hayward, Dublin, San Mateo, Millbrae, and Redwood City in addition to a corporate headquarters facility in Hayward, and a 400,000 square foot distribution center on Fremont Blvd. in Fremont.

Mervyn’s is the latest in a series of high profile retailers to go under. Over the past year or so, we have seen Levitz, Sharper Image, Linens N’ Things, Shoe Pavilion, Steve and Barry’s all succumb to economic and capital markets pressures, and they certainly won’t be the last. Retailers such as Foot Locker, Starbucks, and many others have announced plans for store closures.