Wireless Provider Leases 45,000-SF Building From Bedford

Aperto Networks Inc. provides WiMAX broadband wireless access systems and solutions. The lease is expected to commence in the second quarter of 2006.

The building contains plug-and-play space. Amenities include wired cubicles, security system and phone system. About 75% of the building is built out as office and the remainder is lab space.

Bedford acquired the building for about $3 million in 1996, the same year it was completed. The negotiated lease rate on the Aperto deal was not revealed by the parties involved. The full-service asking rate for the space was $1.08 per sf per month ($0.89 base plus $0.19 for services).

Bedford Property chairman Peter Bedford says the lease is "further indication of the recovery occurring in the Silicon Valley market," where the company owns approximately 13 properties totaling 1.13 million sf. In a November SEC filing, Bedford said Silicon Valley job loss associated with the recent downturn in the local economy has been significant, resulting in increased vacancy and reduced rental rates.

"While the California employment situation has shown improvement in recent months, the oversupply of space and reduced rental rates continue to be a challenge," states the analysis. "In addition, we expect higher than usual lease expirations in the Silicon Valley to continue through the remainder of 2005 and in 2006, which creates the potential for increasing vacancy in our portfolio." In response, the company states in the filing that it is improving the marketability of our vacant spaces, in part by improving them to "near move-in condition."