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GlobeSt.com EXCLUSIVE: Staubach Capital Partners Buys Yahoo Buildings

SUNNYVALE, CA-The Staubach Co. division pays $396 per sf for two office buildings totaling 171,000 sf that are occupied by Yahoo Inc. and located across the street from the Internet company's main headquarters campus.

By Brian K. Miller | Updated on August 23, 2004

SUNNYVALE, CA-Staubach Capital Partners has acquired two buildings here totaling 171,000 sf for $67.7 million, or $396 per sf. The buildings are leased by Yahoo Inc. and are located across the street from the Internet company’s main headquarters near Moffett Field.The price was pre-set as part of a purchase option that Yahoo obtained when it preleased the buildings from the developer, Menlo Equities and Prudential Real Estate Investors. Yahoo, which has occupied the buildings for about two years, recently assigned its purchase option to Staubach Capital Partners, which closed on the acquisition earlier this month.Staubach Capital specializes in sale-leaseback and credit tenant lease transactions. Staubach Capital Partners’ Dallas-based principal Kevin Yancy tells GlobeSt.com that as part of the deal Yahoo saw its rental commitment restructured and reduced. He declined to reveal the new lease rate or confirm the purchase price. A Yahoo spokesperson would say only that the new terms are “significantly better.”The property addresses are 1302 N. Matilda and 1350 N. Matilda. One of the buildings is 81,000 sf and the other 90,000 sf. According to published reports, Yahoo’s 15-year lease agreement with Menlo Equities started at about $2.45 per sf per month, excluding common-area costs. That price reportedly escalated to $3 per sf in year two, with 3.5% annual bumps after that. Based on that, Yahoo’s total obligation under the deal would have been about $114 million. Don Reimann and Gregg von Thaden of Colliers International in San Jose are the brokers who landed Yahoo for the developers. The profit for Menlo and PREI on the deal is reportedly north of $25 million. Menlo Equities executives did not return a phone call seeking comment.

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