The building owner is HDP Assoc. LP, which owns about one million sf within Marriott Business Park. Yoav Ben-Shushan (Starboard Commercial Real Estate/TCN Worldwide) and Jere Hench (Wayne Mascia Associates/TCN Worldwide) represented Lumenis in the transaction. Steve Horton of CPS/Corfac International represented HDP Assoc.
Hench tells GlobeSt.com that Lumenis is relocating from a similar amount of less efficient space at 2400 Condensa St., also in Santa Clara, that it shared with the building owner, Coherent. "The company wanted to upgrade their space before rental rates rose too high and they wanted their own image; they did not want to share their space," he says.
Lumenis' new space at 5302 Betsy Ross Dr. is a former manufacturing building that was renovated into a class A R&D building. It includes two full floors and a mezzanine between the first and second floors, Hench says.
The negotiated lease rate was not released by the parties involved. The asking rate for space in the building was $0.85 per sf per month, triple-net, but was bumped up to $0.95 per sf due to demand, says Hench.
The Santa Clara office market has been very active and there has been a steady decrease in vacancy throughout 2006, Hench says. Vacancy rates in April in the region were more than 30% and now are in the mid teens, Hench says. As a result, demand for quality office space in Santa Clara is high and the supply of such space continues to decline.
"There are still good buildings to be leased, but there are fewer of them and demand remains the same, which is pushing rates," says Hench, adding that at the moment it appears neither the landlord nor the tenant has a distinct advantage. "This is probably the best market for the landlord and tenant combined since 1996 to 1997."
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