“There is worldwide pent-up demand for Silicon Valley properties.” “This is a big purchase, and it makes sense that there is foreign money or money from outside the Bay Area coming in here,” said Chad Leiker, a first vice president with Kidder Mathews, a commercial realty brokerage.
The Parlex 6 Finco entity, which corporate records show is a foreign limited liability company with offices in Manhattan, provided the Lane Partners group with $197.4 million in financing for the deal. 30, according to county records. Brocade sold the properties in four transactions to separate affiliates controlled by Menlo Park-based Lane Partners.īut the real financial muscle behind the deal appears to be a lender operating under the name Parlex 6 Finco. The Brocade complex of three office buildings, totaling more than 541,000 square feet, sold for $225.5 million.
Hillsdale mall in San Mateo brings big real estate investor on board Google eyes hundreds of downtown San Jose homes over BART station site Two downtown San Jose housing towers may sprout next springĬould SJ mobile home owners buy a $500 million piece of Silicon Valley?ĭowntown San Jose tower offers new housing approach And while demand remains solid for Silicon Valley properties at the moment, a real estate expert and an economist sounded notes of caution about potential headwinds coming for commercial real estate. The move comes as Bay Area job growth has slowed this year. SAN JOSE - After merging with chipmaker Broadcom and planning layoffs, Brocade Communications has sold its three-building San Jose headquarters and a nearby parking garage to a realty developer. Today’s deal is expected to close in October next year, and is of course going to be subject to regulatory approval.Brocade's San Jose campus is sold following merger, layoffs The company blog post did little to address that. Ruckus Wireless, the company it bought last April suddenly finds itself in no-man’s land with no clear understanding of who its owner will ultimately be.īroadcom itself was sold to Avago in a massive $37 billion deal in May, 2015, but apparently can continue to make its own deals, even as part of the larger entity. The nature of the deal in which they are planning to sell off parts of the business will have to create a level of uncertainty among Brocades’s current customer base. “As part of this transaction, our Storage Area Network (SAN) business, will offer a strong complement to Broadcom’s offerings and capabilities, creating one of the industry’s broadest portfolios for enterprise storage,” Carney wrote in the blog post.Ĭarney indicated that the two companies decided to sell the rest of the networking business because of “competitive overlap with some of Broadcom’s most important customers.” In other words, Broadcom didn’t need that part of Brocade’s business competing with what it was already offering, and it didn’t have enough unique customers to make keeping it worthwhile (and I suspect it will also help pay for the deal as well). A 47 percent share price premium will tend to do that.īut the company also saw an opportunity to create a networking storage powerhouse by combining with Broadcom. In a blog post on the Brocade community blog, CEO Lloyd Carney indicated his company wasn’t looking to sell, but Broadcom offered a deal so compelling they couldn’t refuse. It seems what Broadcom had its eye on was the networking storage part of the business and the company believes that by combining the two lines, they could create a powerful entity in the fibre channel Storage Area Network (SAN) business. While Brocade has a broader networking business, under the terms of the deal, Broadcom will divest the IP networking part of the business including Ruckus Wireless, a company Brocade just recently acquired.
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