Lionstone Investments has sold Tasman Tech to Washington Holdings LLC, a West Coast-based institutional investment firm, for $170 million. The investor recently completed a renovation of the 14-building property, which attracted new tenants.

Located at Tasman Drive at I-880 in Milpitas, the property has a full suite of amenities, including on-site retail, outdoor collaboration areas, fitness center and ChargePoint vehicle chargers. It is also proximate to the VTA Light Rail ride to Milpitas BART station, and there is a BART expansion planned in the area in the future. Thanks in large part to the upgrades, the property maintained strong leasing through the pandemic and has strong in-place cash flow.

The Silicon Valley office market, overall, was impacted by the pandemic, but new deliveries helped to drive leasing activity in the market. In the first quarter of the year, office inventory in the market increased by 17 million square feet, according to research from Savills. It was welcome news for office users looking for high-quality space at a discount. The construction pipeline, however, has driven the vacancy rate to 14.4% to 18.4% and asking rates have decreased to $4.82 per square foot, down $0.08 from the first quarter 2020. With new product continuing to arrive, tenants will find plenty of opportunities to secure quality space.