2090 fortune drive
TRANSCRIPT
172,478 SF MANUFACTURING/R&D • 100% NNN LEASED • CORE SV LOCATIONS
47131 BAYSIDE PARKWAY, FREMONT
2090 FORTUNE DRIVE, SAN JOSE
TECH MANUFACTURING PORTFOLIO
2090 FORTUNE DRIVE
47131 BAYSIDE PARKWAYMilpitas Station
Warm Springs/ South Fremont Station
Building Address 47131 Bayside Parkway 2090 Fortune Drive
City Fremont, CA San Jose, CA
Building Area 100,728 SF 71,750 SF
Year Built / Renovated 1990 / 2018 1996 / 2014 / 2018
Stories Two One
Site Area 5.47 Acres 4.71 Acres
Parking 3.6 / 1,000 SF 3.3 / 1,000 SF
% Leased 100% 100%
% Lab/Warehouse 65% 81%
% Office 35% 19%
Tenant Mattson Technology Bestronics
WALT 7.7 Years 6.9 Years
% Below Market 13.4% 24.7%
PROPERTIES SUMMARY
THE OFFERINGCushman & Wakefield, as exclusive advisor, is pleased to
present the unique opportunity to acquire two institutional
quality, recently renovated, headquarter manufacturing/
R&D assets, ideally located in Silicon Valley, CA. 47131
Bayside Parkway in Fremont and 2090 Fortune Drive in San
Jose comprise a total of 172,478 square feet and are each
100% leased to a single tenant with an overall weighted
average lease term of 7.4 years. Offers on a fee simple
interest will be accepted on individual properties and/
or the combined portfolio.
The assets are situated along the I-880 Corridor, Silicon
Valley’s premier advanced manufacturing setting that
is home to major employers such as Tesla Motors, Lam
Research, Seagate, Western Digital, Thermo Fisher, and
Boston Scientific, along with numerous clean tech, life
science, internet, and advanced manufacturing companies.
With strong in-place cash flows, exceptional market
fundamentals, and prime Silicon Valley locations,
the offering presents a compelling opportunity to
acquire high quality manufacturing/R&D real estate
in one of the nation’s strongest markets, at a discount
to replacement cost.
2 » 880 CORRIDOR PORTFOLIO
INVESTMENT HIGHLIGHTSStable In-Place Cash Flow From Long-Term Tenants
47131 Bayside Parkway is 100% NNN leased to Mattson
Technology and serves as the company’s corporate
headquarters. Mattson has occupied the property since
2007 and recently signed an extension through December
2026. Mattson recorded $252 million of revenue in 2017 and
is a globally recognized semiconductor manufacturer. 2090
Fortune Drive is 100% leased to Bestronics on a modified net
basis through February 2026 and serves as the company’s
headquarters. Bestronics, which has occupied the Property
since 2013, manufactures products serving Fortune 100
companies and startups alike in the telecommunications,
industrial automation, medical, and scientific industries.
Desirable NNN Lease Structure
The leases provide for annual increases in the tenants’
base rents which provide an investor with an increase in
cash flow during the lease terms, as well as a hedge against
inflation. The NNN structure of the leases make the tenants
responsible for the cost of all building operating expenses
(excluding administrative salaries for 2090 Fortune).
Institutional Quality Assets with Significant Recent Renovations
47131 Bayside & 2090 Fortune offer efficient floorplates,
high-end design, ample parking, heavy power and lofty clear
heights—features that cater to the demands of Silicon Valley’s
discerning tenant base. 47131 Bayside comprises 55% lab/
manufacturing space, 10% warehouse, and 35% office. 2090
Fortune is 70% lab/testing, 11% warehouse, and 19% office.
Core Silicon Valley Manufacturing Locations
Located in Silicon Valley, the nation’s top performing
technology market and advanced manufacturing
hub, the assets benefit from immediate access to a
competitive high-tech workforce. Companies choose
Silicon Valley because the innovative technology that is born
in the region has helped to transform design, production,
and manufacturing operations. Many of the world’s largest
manufacturers call Silicon Valley home including Tesla, Lam
Research, Flextronics, Intel, and Sanmina Corporation.
EXECUTIVE SUMMARY » 3
47131 Bayside Parkway, Fremont
San Jose International Airport
Bayside Business Park
47131 BAYSIDE PARKWAYFremont Blvd.
Warren AveParc 55
Development
HQ
4 » 880 CORRIDOR PORTFOLIO
2090 Fortune Drive
Great Mall
Geometric
2090 FORTUNE DRIVE
Montague Expy
Lundy Ave
Fortune Drive
Advanced Manufacturing
Products
Milpitas StationMontague
VTA Station
MA Labs
EXECUTIVE SUMMARY » 5
INVESTMENT HIGHLIGHTSAttractive Discount to Replacement Cost & Other Bay Area Markets
This offering presents the opportunity to acquire well-
located, in-demand, manufacturing/R&D facilities
below replacement cost. As competing product sales in
neighboring markets have been approaching $300-$500
per square foot, an investor will have a very attractive basis
relative to higher priced submarkets in the Bay Area.
Flexible Exit Opportunity
The properties, which have staggered lease expiration
dates, can be bought individually or as a portfolio. Acquiring
the assets as a portfolio will provide an investor flexible
disposition scenarios. The owner will have the optionality to
exit in the future as a portfolio sale or individual asset sale
to 1031 exchange buyers or owner/users.
Top Performing Market
Silicon Valley is renowned as the world’s center of
technology due to the high concentration of revolutionary
technology companies and an unparalleled stream of
venture capital investment. As one of the Bay Area’s
key economic drivers, the region’s technology sector
flourishes from immediate access to one of the most
highly educated workforces in the nation. Over the
past five years, growth from some of the region’s most
prominent employers such as Apple, Google, Samsung,
Netflix, and Facebook has made Silicon Valley the
nation’s top performing R&D market. In the same period,
the market has absorbed 9.2 million square feet of
R&D space and asking rents have grown nearly 38%,
significantly outpacing most major markets in the
country. Additionally, industrial rents in Silicon Valley
have doubled since 2013.
Q4 2018 R&D MARKET SNAPSHOT9.6%
VACANCY$2.42
AVG. ASKING RATE/MO.1.5 MSF
NET ABSORPTION
6 » 880 CORRIDOR PORTFOLIO
BART Transforming the I-880 Corridor
The addition of the Warm Springs BART extension has transformed
Fremont into a transit-oriented city with increasing attractiveness to a
wide variety of companies. A shuttle service runs from Bayside Business
Park to Warm Springs Station, providing commuters with quick access
to Fremont’s largest business park that is home to Mattson Technology.
Warm Springs Station has become a development hub with new residential
planned nearby. The station offers intermodal access to Alameda-Contra
Costa Transit (AC Transit) buses along with 2,000 commuter parking
spaces. The BART extension to Milpitas Station, expected to open later
in 2019, is expected to bring a similar dynamic to International Business
Park, home to Bestronics. More than a thousand new housing units have
recently been built around the station area. The station which will have
access to ±1,500 parking spaces, will be connected via pedestrian bridge
to Santa Clara County’s Valley Transit Authority (VTA) Light Rail system,
and will be less than a ten minute shuttle ride to International Business
Park. Moreover, the downtown San Jose Diridon Station and Santa Clara
extensions are expected to open by 2026.
EXECUTIVE SUMMARY » 7
INVESTMENT CONTACTS
MARKET ADVISORY DEBT ADVISORY
CONTACTS
STEVE HERMANNLic. #01352679ph | [email protected]
NICK LAZZARINILic. #01788935ph | [email protected]
ERIC FOXLic. #01209035ph | [email protected]
STEVE HORTONLic. #01736975ph | [email protected]
ADAM LASOFFLic. #01891096ph | [email protected]
TODD BEATTYLic. #00976940ph | [email protected]
SETH SIEGELLic. #01493953ph | [email protected]
RYAN VENEZIALic. #01864838ph | [email protected]
TERRY DALYLic. #01330089ph | [email protected]
TECH MANUFACTURING PORTFOLIO
C&W NATIONAL INDUSTRIAL ADVISORY GROUPWESTSteve HermannJeff ChiateMike Adey
SOUTHWESTJud ClementsRobby RiekeTaylor Starnes
CENTRALJim CarpenterMike TenterisAdam Tyler
FLORIDAMike DavisRick BruggeMichael LernerRick Colon
SOUTHEASTStewart CalhounCasey Masters
NORTHEASTGary GabrielGerry BlineburryKyle SchmidtJon Carpenter