MOUNTAIN VIEW — A Google-occupied office building in Mountain View has been bought by a billion-dollar real estate investment firm, in a deal that underscores a robust Silicon Valley economy and property sector.
Los Angeles-based Preylock Real Estate Holdings bought the four-story building, which is located at 620 National Ave., a few miles from the titan’s Googleplex headquarters as well as downtown Mountain View and a busy Caltrain station.
The 151,000-square-foot office building is deemed to be a choice commercial property whose value is greatly heightened by the nature of the structure’s only tenant, search giant Google.
“This is a core type of asset with a top-credit tenant in a tight office market,” said Phil Mahoney, an executive vice chairman with Newmark Knight Frank, a commercial real estate firm.
Preylock Real Estate, acting through an affiliate, paid $190 million for the Mountain View building, according to public documents filed on Sept. 12 with the Santa Clara County Recorder’s Office. The building is located near the corner of North Whisman Avenue and Fairchild Drive south of U.S. 101.
Colliers International and JLL, two commercial real estate firms, were commissioned to find a buyer for the building, according to realty sources.
Google is a long-term tenant in the building with a lease that runs through 2029, sources said.
Preylock has been a busy buyer of Silicon Valley commercial properties in recent years. The company seeks out office buildings with top-tier tenants, according to its website.
In 2017, the company bought two Santa Clara office buildings on the same day. Preylock paid $195 million for an office building at 2001 Walsh Ave. and $131.3 million for another office building a short distance away at 2880 Scott Blvd. Both buildings are leased to Nvidia, a maker of chips used for high-performance tasks such as video games.
Preylock in 2018 paid $83.8 million for a six-building office complex in San Jose called Central Park Plaza that’s located near the corner of Junction Avenue and Zanker Road. Also in 2018, Preylock bought an office building right around the corner at 2851 Junction Ave. in San Jose, paying $82 million.
Early in 2019, Preylock bought a Los Gatos office building on Albright Way that’s leased to Netflix, paying $85 million for that property.
Preylock has under its management $1.25 billion in real estate assets, the company’s website states.
The Mountain View building that Preylock now owns through this week’s transaction is relatively new, according to Mahoney. The building was constructed in 2017.
Preylock Real Estate’s interest in the office building suggests the commercial property market has yet to cool off in Silicon Valley, Mahoney opined.
That strength appears to be especially solid in the tightest Silicon Valley office markets such as Palo Alto, Mountain View, Sunnyvale, and Cupertino.
“The momentum remains in place for both leasing and investments in northern Santa Clara County,” Mahoney said. “These are still very strong.”