McAfee Signs Big Lease
Submitted April 1, 2010, 11:05 PM
Network and systems security provider McAfee Inc. has signed the largest Silicon Valley lease of the first quarter.
The Santa Clara-based company has agreed to occupy 241,000 square feet at a campus owned by the valley’s Sobrato Development Cos. The lease has a 10-year term and an effective rent of $1.86 a square foot per month, according to industry sources. The same sources said McAfee also has signed an option agreement to lease another 40,000 square feet from Sobrato in the same complex in the next 60 days.
A spokeswoman for McAfee said in an email message that she could not confirm the Sobrato lease.
The McAfee lease was one of three large new lease transactions that pushed Silicon Valley office vacancy rates down 1.1 percentage points to 19.4 percent in the first quarter, according to a report released March 31 by brokerage CB Richard Ellis. It is the second quarter in a row that valley vacancy rates fell.
Besides McAfee, NetLogic leased 105,930 square feet at 3975 Freedom Circle in Santa Clara and WilmerHale leased 71,409 square feet at 950 Page Mill Road in Palo Alto, CBRE said.
Despite the uptick, asking rental rates still declined.
Sale transaction volume rose, however, with more office sales over 50,000 square feet occurring in the first quarter than in all of last year, CBRE said. The largest sale was to Equity Office Properties: a 193,977 square-foot office building at 1600 Technology Drive in San Jose adjacent to the San Jose airport. Brocade Communications Systems Inc., which is moving to a new campus on North First Street at state Highway 237, was the seller.
Equity Office paid $30.35 million for the property, according to documents filed by Brocade with the Securities and Exchange Commission.
Equity Office is already one of the largest commercial property owners in Silicon Valley, including a large concentration near the San Jose airport.
