SUNNYVALE — A big tech campus in Sunnyvale has been bought for about $15 million, a price that represents a stunning plunge in value from the most recent official estimate for the property.
Ellis Partners, acting through an affiliate, has paid $15.5 million for an office and research campus at 755 North Mathilda Ave., according to documents filed on Feb. 10 with the Santa Clara County Recorder’s Office.
That price is less than half of the most recent property value estimate for the site that was issued by the Santa Clara County Assessor’s Office.
Mathilda Tech Campus consists of two office buildings and a courtyard. The buildings together total 105,000 square feet, according to Ellis Partners.
“We are planning a significant renovation and modernization of the property, including modernized facade, lobbies, and courtyard improvements,” said Jim Ellis, co-founder and managing principal executive with Ellis Partners.
Newmark commercial real estate brokers Steven Golubchik, Ramsey Daya, Edmund Najera, Chris Moritz, Darren Hollak, Francesca Zappula and Brendan Raney arranged the property purchase.
LinkedIn, a career-oriented social network, has leased this property. Both buildings are being offered for sublease. The lease ending date wasn’t immediately known.
The office campus attracted potential buyers at a brisk pace, according to Newmark brokers.
Ellis Partners bought the Sunnyvale tech campus at a price that was 54% below the property’s estimated value of $33.8 million as of January 2024, as posted by the County Assessor’s Office.
Clarion Partners, through an affiliate, sold the tech campus to Ellis Partners, according to the Recorder’s Office documents.
A feeble price for an office or hotel property has become a familiar refrain for the Bay Area’s wobbly commercial real estate markets.
Yet declining values are far more than merely a milestone to assess the weakness or strength of the Bay Area commercial property sector.
Commercial real estate’s slumping values are poised to become a widening challenge for Bay Area city, county, and regional agencies, as well as public school districts, that depend on property taxes for some or much of their revenue.
Lower prices for office, retail and hotel buildings might do more than hobble increases in property tax revenue. The slumping values might even cause property tax revenue to decrease.
Either outcome could squeeze government coffers over the next year or so should the value slump persist.
The relatively low price for the office and research complex could enable the campus to entice potential tenants that would sublease one or both buildings.
“Investors are gaining increasing confidence in the leasing market,” said Najera, a Newmark vice chairman.