CIP Real Estate Pays $40M for San Jose Industrial Asset

CIP Real Estate has acquired Tully Business Center, a small-bay, 143,221-square-foot industrial park in San Jose, Calif. Dollinger Properties sold the asset for $40 million. The Colliers team of Andy Zighelboim and Kevin Moul represented both parties.

CIP owns other properties nearby as well, including Cabot Business Park in Hayward, Calif., and Bayside Tech Park in Fremont, Calif.

And, barely a year ago, CIP acquired Clipper Court Commerce Center, a 14-building, a 352,280-square-foot industrial park in Fremont from BKM Capital Partners. J.P. Morgan Asset Management provided acquisition financing for the $103.5 million deal that was brokered by Newmark.

Tully Business Center, up close

The Class B property came online in 1987, according to CommercialEdge information. The campus comprises six single-story buildings totaling 81 light/flex industrial and R&D units ranging from 500 to 5,000 square feet. Each building has grade-level loading.

The 11-acre Tully Business Center is at 1310-1460 Tully Road, close to the 101, 280, 680 and 880 freeways, providing easy access to the Greater Bay Area.

The asset was 92 percent leased at the time of sale. Its largest tenant is AM&S Inc., an aerospace machine manufacturing company. CIP plans to invest more than $750,000 in property improvements, including project rebranding and the immediate upgrade of all vacant suites into “ready-to-lease” condition.

After advising earlier this year on the disposition of a 1.7 million-square-foot multi-state light industrial portfolio, part of which is in San Jose, Cushman & Wakefield commented that the small-bay niche remains in high demand for its ability to accommodate a variety of user types and hence sees continuing demand from investors.