The Burlingame Point development is on 18.13 acres of Bay waterfront on the Peninsula.

BURLINGAME, CA—Burlingame Point is an 803,000-square-foot office/R&D campus that is fully leased to Facebook Inc. for occupancy by Oculus, Facebook's virtual reality company. Expected for 2020 completion, the development is situated on 18.13 acres of Bay waterfront on the Peninsula. Comprised of four office buildings, an amenity building and a parking structure, the campus offers 360-degree views of the Bay and surrounding mountains.

While the below-ground construction on the project has been underway for more than a year and Facebook inked its lease around year-end 2018, the financing piece took a dramatic shift thereafter, GlobeSt.com learns. As the project continued to progress, Kylli Inc. recently obtained $515 million in construction financing.

The financing was provided by JP Morgan and Starwood Property Trust. A Cushman & Wakefield team led by Steve Kohn and Mike Moran with Chris Moyer, Terry Daly, Clarke Funkhouser, Noble Carpenter III and Jessica Ke represented Kylli Inc. in procuring the financing.

“The project changed its financing source in mid-stream after construction had begun, which is unusual,” Moran tells GlobeSt.com. “But this is easier when Facebook is involved. However, we got comments from interested parties saying they would finance on spec, with or without Facebook, just due to the market conditions here.”

To be sure, the amenities at Burlingame Point alone would be enough of an enticement. This includes a daily dedicated shuttle service to the nearby Caltrain and BART stations, a full ground floor of retail and dining options, a gym facility, a hotel, daycare, onsite parking structure and outdoor green spaces. The nearby Bay Trail along the waterfront provides jogging and walking options. The property is also minutes from San Francisco International Airport as well as Highway 101 and Interstate 92.

“Any time you bring a world-class property like Burlingame Point with its Bayfront location to two of the world's leading lenders, that's a newsworthy event,” Moran tells GlobeSt.com. “A project of this caliber continues to bring prominence to the city and foreshadows the future for Burlingame and its waterfront. Burlingame is all in on activating its waterfront.”

San Mateo County currently has 4.9 million square feet under construction, a significant addition of new product coming down the pipeline, according to a first quarter report by Cushman & Wakefield. Though demand is currently keeping up with this increased supply and vacancy is still relatively low, the rising inventory bears watching for any signs of overbuilding in the market. Despite the large amount of pre-leasing of new construction, this can potentially leave large blocks of second- and third-generation space vacant as occupiers move to new facilities, says the report.

“The market for construction and transitional financing has been bursting at the seams over the past year with well-located office development for world-class technology, biotechnology and life science companies on the radar of more lenders and investors,” said Kohn. “Special projects like Burlingame Point are attracting capital and tenants from around the world.”

The project is such a newsmaker that the Northern California chapter of SIOR featured Burlingame Point in its annual bus tour on March 15. The project was the first stop on the tour, which provided commercial real estate project insights to 50 students from the Undergraduate Real Estate Club at the University of California, Berkeley.

In addition to Burlingame Point, Kylli Inc. is working on Mission Point, a 10.5 million-square-foot mixed-use development located at 3005 Democracy Way in Santa Clara, CA. The project is eight miles from downtown San Jose and just minutes from a multitude of Fortune 500 companies including Apple and Google.

“Our deep real estate experience has allowed us to establish our position in the US as a forward-thinking owner/investor together with being an innovative developer,” said Ou Sun, CFO and secretary of Kylli Inc. “We continue to construct high quality class-A projects of scale in the San Francisco Bay Area and around the country designed to meet the needs and complexities of our tenants as well as our communities.”