R&D Lease is Tri-Valley’s Largest Since Q2 2016
Valent USA’s 96,535-square-foot lease represents a consolidation of its Dublin and Walnut Creek operations into a location between the existing operations while meeting its high-end R&D needs.
SAN RAMON, CA—The three-building Canyon Corporate Park located at 4600 Norris Canyon Rd. was built in 1984 by a single user. The park’s three-story office building was sold to Kaiser several years ago, and a joint venture of Cannae Partners LLC and New York Life Investors purchased the two remaining buildings out of default in 2014, GlobeSt.com learns.
The joint venture purchased the buildings with the intent of modernizing the project, which was accomplished recently. Fast forward four years and a nearly 100,000-square-foot lease in the corporate center represents the largest new R&D lease in the Tri-Valley since the second quarter of 2016.
Valent USA’s 96,535-square-foot lease offered a location between the existing 680 Corridor operations while meeting its specific high-end R&D needs The tenant is a crop protection firm serving the North American agricultural and non-crop products markets.
The new lease now puts Canyon Corporate Park at 100% leased. Newmark Knight Frank managing directors Dan Watson, Dave Bruzzone and Dan Dowd represented the landlord on behalf of an institutional investor in Valent’s 20-year lease transaction.
“The building has an 8-foot interstitial space between the floors, which is perfect for R&D uses and helped to attract Valent,” said Watson. “Between the intrinsic nature of the building itself and site location, Canyon Corporate is an ideal choice.”
The property also benefits from a recently renovated outdoor common area and a strategic location with street frontage on Norris Canyon Road.
“We are delighted that Valent has made a long-term commitment to Canyon Corporate. Valent’s lease demonstrates the attractiveness of the San Ramon market for world-class tenants and completes our turnaround of the campus,” said Bob Basso, principal with Cannae Partners LLC.
In previous quarters, a number of large pending lease and sale transactions were close to the one-yard line and the third quarter was the beneficiary of most of those deals closing. As a result, the accumulated negative absorption has been erased, and the Tri-Valley office and R&D market is now positive for year-to-date 2018, according to a report by Newmark Knight Frank.
The third quarter registered 723,563 rentable square feet of positive absorption, the largest single quarter of positive absorption since 2000 in the peak of the dot-com boom. Almost three-quarters of a million square feet were leased or sold. This erased the negative absorption of 463,959 rentable square feet and brought the total year-to-date absorption through the third quarter of 2018 to positive 259,604 rentable square feet. And, the overall availability rate for the Tri-Valley decreased from 14.6% to 11.84%.
“The R&D market has been very strong in the Tri-Valley in the last several years,” Watson tells GlobeSt.com. “Demand has been consistent and downtime for vacancies is short as compared to the rest of the market. This has resulted in rents nearly doubling since the last recession.”