Apple Dips into San Jose Market
- Jul 13, 2015
By Keith Loria, Contributing Editor
The Silicon Valley Business Journal reported that Apple Inc., has reached a deal to lease the nearly 300,000-square-foot 101 Tech campus at 2325 Orchard Parkway in San Jose, Calif., it’s first major lease in the area in decades.
The property is the former headquarters of Atmel Corp. It was acquired by Ellis Partners for $48.5 million in 2011 and renovated to become a sleet tech R&D office campus.
According to DTZ’s snapshot of the Silicon Valley Office Market for the first part of 2015, not only has the office market rebounded from the Great Recession era lows, but it has surpassed many of the records set during the dot.com era.
The report showed that Q1 occupancy growth was 2 million square feet and asking rents were up 10 percent year over year and nearly 50 percent from the low of 2005. Currently, 5.9 million square feet of new office product is under development.
According to real-estate-research service Reis Inc., the San Jose office market, which includes Silicon Valley, has seen the largest rent growth in the country with a 7.2 percent increase over last year, with rents commanding just north of $28 a square foot, thanks in large part to tech companies coming to the area and expanding.
Facebook Inc., for instance, has scheduled a giant Frank Gehry-designed expansion at its headquarters in Menlo Park, Calif.
The San Jose deal is something of a return to the area for Apple. In the late ’80s, the company leased nearly 20,000 square feet at River Park Tower.
Terms of the deal, including lease length, were unknown. So far, Apple has not announced what it will be using the 101 Tech campus for, but the mega tech company has continued to grow. In fact, it’s also constructing a 2.8-million-square-foot campus in Cupertino, scheduled to open in late 2016.