Business

Midwest investors scoop up huge Santa Clara site that is leased to Amazon unit


SANTA CLARA — A realty investment group has bought a huge industrial building in Santa Clara, part of an intricate series of deals that also enabled an Amazon unit to lease the property and gain an option to potentially buy the site at some point.

Chicago-based IPI Partners, a private equity firm that invests in data centers and other tech-related properties, has acted through an affiliate to buy an industrial building at 2305 Mission College Blvd. in Santa Clara.

IPI Partners paid $101.4 million for the industrial building, according to property documents filed on Dec. 24. Minnesota-based developer Oppidan Inc. also gained an ownership interest in the building through the property purchase, the county documents show.

The building, totaling 359,000 square feet, is near the corner of Mission College Boulevard and Agnew Road, a short distance from the Intel world headquarters and museum complex.

An Amazon unit is also involved in the wheeling and dealing regarding the building, which is being marketed by brokers Philip Mahoney and Jeff Arrillaga of Newmark Knight Frank, a commercial real estate firm.

Acting through an affiliate it controls, Amazon Web Services has leased the building, according to county documents. Amazon Web Services provides on-demand platforms for cloud computing operations

The lease term is 15 years, the public property records show. The documents on file with the county didn’t disclose a starting date for the rental agreement.

However, Amazon Web Services also has obtained an option to buy the property, the county records show, although precise details were scant.

The public documents show that the Amazon unit has taken steps to preserve maximum flexibility in deciding just how it should be involved in the property over the long term.

Amazon Web Services gained a right to make the first offer to buy the property, as well as the right to be the first to refuse to buy the site, depending on circumstances in the future.

The Santa Clara deal marks at least the third time in recent months e-commerce behemoth Amazon has leased big industrial buildings in the Bay Area.

In November, Amazon rented a trio of large buildings that the digital titan intends to use as a delivery center on North McCarthy Boulevard in Milpitas. Together, the three buildings total roughly 343,000 square feet, according to a site plan in a brochure prepared by commercial real estate firm CBRE.

Also in November, it was disclosed by this news organization that, in a quiet yet stunning new expansion of its Bay Area operations, Amazon has leased a huge industrial building near Interstate 580 in Livermore. The e-commerce and video streaming colossus leased a Livermore building totaling 612,000 square feet.

Both the Livermore and the Milpitas industrial complexes will be used by Amazon as delivery centers that will help the tech titan be closer to the customers who are purchasing products.

In Santa Clara, the Mission College Boulevard property is slated to be a brand-new data center totaling 496,000 square feet after the existing building is torn down and replaced.

That sort of data-oriented use could potentially dovetail with the principal …read more

Source:: The Mercury News – Business

      

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