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Tilt-Up Campus Giving Way to Higher, Better Use

SUNNYVALE, CA-On the heels of another such redevelopment here, California Bavarian Corp. demolishes a two-building, single-story campus here and breaks ground for a pair of new three-story buildings.

By Brian K. Miller | Updated on September 17, 2007

SUNNYVALE, CA-California Bavarian Corp. of Palo Alto has razed a two-building tilt-up campus here and broken ground for a pair of three-story, 62,000-sf buildings that will replace them. The redevelopment site sits on the northeast corner of Mathilda Avenue and Bordeaux Drive, near the US 101-State Route 237 interchange. The new campus, called Bordeaux Centre, is slated to be ready for tenants in the third quarter of next year. Wrightwood Capital is providing an 18-month, $36.4-million construction loan that covers 90% of the development cost.

The new buildings will be delivered as a “warm shell,” which the developer is valuing at $35 per sf. The asking triple-net lease rate, $3.25 per sf, assumes an additional tenant improvement allowance of $25 per sf. Mike Benevento of CB Richard Ellis, who with partner Jeff Houston has the leasing assignment for the new campus, says he’s just started marketing the property, which is already generating a lot of activity.

Yahoo, whose headquarters are located next door, leased the old campus right up until it was torn down 60 days ago, he says. Based on interest received to date and the rapid expansion of nearby companies such as Yahoo and Juniper Networks and Network Appliance, Benevento tells GlobeSt.com his expectation is that whole-campus or whole-building users will lease the property prior to completion.

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