PALO ALTO, CA—CBRE Capital Markets’ Debt & Structured Finance team recently arranged $86.5 million in non-recourse financing for the acquisition of 3175 Hanover St, a 128,678-square-foot, single-tenant office building.
The property is leased to Cooley LLP, an esteemed global law firm, and it is located in the prestigious Stanford Research Park, which is home to many companies such as VMware, Hewlett-Packard, and Tesla’s HQ and research facility.
John Nelson of CBRE’s San Francisco office arranged the acquisition financing on behalf of the borrower, a Sand Hill Property Company joint venture. The financing was provided by a Wall Street lender.
“This was one of the most competitive financing situations I have seen in quite some time. The intense competition among lenders was a direct function of the strong location and tenancy of the prospect in addition to the excellent sponsorship,” Nelson said.
Stanford Research Park was developed by Stanford University starting in 1951. It was the first of its kind and became the pillar for the evolution of Silicon Valley. Over the years it has been home to some of the most successful and respected companies in the world. Today it boasts a world-class reputation as one of the largest and best known research parks. It encompasses 700 acres, has 10 million square feet spread out in 160 buildings and facilities, and its 150 companies employ more than 23,000 people. It is located directly adjacent to the Stanford University campus.
The Greater Palo Alto area has benefited greatly due to its proximity to a large employee talent pool and increased venture capital funding. Last year, the Silicon Valley region received the largest portion of overall venture capital funding for a single region ever tracked, with the area taking 41.3% of the $29 billion invested nationally. Moving further into 2014, the market will likely continue to see positive fundamentals as it remains one of the most attractive places for companies to start and grow.