Preylock Pays $183M for Bay Area Office Asset

3333 Scott Blvd. Image courtesy of CommercialEdge

Preylock Real Estate Holdings has acquired a 244,906-square-foot office asset in Santa Clara, Calif., for $182.5 million, according to CommercialEdge data. The seller, a partnership between CBRE Global Investors and CalSTRS, had bought the building for $162.5 million in 2017, after its completion.

Records filed with Santa Clara County show that Preylock borrowed $120.9 million of PCCP LLC‘s debt funds, via promissory notes, for the acquisition.

Developed by Menlo Equities, the recently purchased Class A building was fully occupied by Applied Materials at the time of closing; the company had subleased the space from Aruba Networks Inc. in 2022.

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Situated on 3.5 acres at 3333 Scott Blvd., north of Applied Materials’ Santa Clara headquarters, the six-story asset is part of the 1.3 million-square-foot Campus @ 3333. The 30-acre property comprises seven office buildings, two parking garages and a 30,000-square-foot amenity building. Features include a fitness center, cafeteria, basketball court, outdoor dining area, bocce ball court and outdoor seating spaces.

The office campus is 3.5 miles from downtown Santa Clara and roughly 7 miles from downtown San Jose, Calif. The location is less than 5 miles from Meta Sunnyvale Campus, the 719,037-square-foot property that changed hands last year in Silicon Valley’s largest investment sale.

The Bay Area commands high prices

The 3333 Scott property sold for roughly $745.3 per square foot in one of the largest deals of the Bay Area market this year so far. The transaction shows that, while the office sector is facing serious headwinds, demand in certain areas continues to result in very high prices, especially for Class A space.

Bay Area’s office sales averaged $448 per square foot in the first four months of the year, according to a recent CommercialEdge report. The value was more than double the one recorded on a national level ($196 per square foot), although 13 percent smaller on a year-over-year basis.