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SANTA CLARA, CA-Harris Stratex Networks has signed a 10-year lease for 5200 Great America Parkway, a vacant 128,000-square-foot building across from the Santa Clara Convention Center, according to multiple sources. The wireless networking company will be relocating to the three-story building from 120 Rose Orchard Way in San Jose.

The building Harris Stratex is moving to is part of Great America Plaza, a three-building, 227,585-square-foot development on nine acres that also includes 2903-2933 Bunker Hill. DJM Capital Partners acquired the complex in January 2007 for for approximately $43M with a first mortgage loan from Marathon Structured Finance totaling $46.5 million, the excess having been spent on capital improvements to the complex. At the time, all of the leases were reportedly scheduled to expire by the end of 2010.

DJM has since renewed the leases in the other two buildings and added additional tenants, bringing occupancy in those two buildings up to 85%. When it inked the deal with Harris Stratex, DJM also completely recapitalized the asset. Using private equity, it reportedly bought its first mortgage loan from Marathon at a significant discount such that its cost basis in the property is now lower than it was initially. DJM Capital structured new financing with its existing mezzanine lender, American Realty Advisors.

“Completing a sophisticated financial transaction in this environment is a rare occurrence. As any real estate owner or developer can attest, it’s difficult to secure even the simplest, most straight forward loan,” DJM Capital founder and CEO D. John Miller said Friday afternoon in a prepared statement. “Our firm’s investment approach has yielded significant returns without over-leveraging. We also have long-standing relationships with numerous lenders, institutional investors and other capital sources. This positioned us to achieve a reduced debt position and enhance the value of this asset.”

Harris Stratex says in its quarterly report filed this week that the lease increases its operating leases commitments by $24 million, which would equate to an average monthly lease rate of $1.56 per square foot per month on a net basis. The average asking full-service lease rate in the Santa Clara office market is approximately $1.90 per square foot per month, according to a third quarter report from Cornish & Carey Commercial/Oncor International. Vacancy in the submarket is approximately 10% on the direct basis and 20% when sublease availabilities are included.

Colliers International brokers handled both sides of the lease deal. Cynthia Rotwein and Duffy D’Angelo have the listing assignment for the property. Marty Morici represented Harris Stratex.

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