WINNER OF THE 2013 - ctbt.com€¦ · VINAY BHATIA San Jose Market Report Second Quarter 2014 650.320.0241 | [email protected] | Lic #01854270 Sales Summary Sale Date

San Jose MarketMarket Activity | Q2-2014

WINNER OF THE

2013 RISING STAR

AWARD#1 AGENT UNDER 5 YEARS IN THE BUSINESS

About Vinay Bhatia San Jose Market Activity San Jose Market Sales Comparable Properties

VINAY BHATIA | Vice President650.320.0241 | [email protected] #01854270

San Jose Market ReportSecond Quarter 2014

About the Multi-Family Group

Cassidy Turley’s Multi-Family Investments is Northern California’s source

for apartment brokerage services.

We are a collection of experienced real estate professionals providing

comprehensive market coverage to a diverse collection of clients including;

individual investors, operating partnerships, corporations, REITs and

equity funds. Our business model emphasizes the exclusive listing of

apartment properties by utilizing a transparent marketing process to

assist our clients in realizing their investment objectives. We monitor

the changes in the debt market in order to provide our clients real time

information relating to the impact of interest rates on property values.

We are also in constant contact with third party professionals such as

property management companies to help our clients in accessing the

best available services. Our mission is to assist our clients in their multi-

family investments, including when it meets their goals, representing

them in a property sales transaction.

Since our inception, we have grown to be one of the largest apartment

brokerages in Northern California. Our expansion has primarily been the

result of attracting experienced brokers to join us from our competitors.

We are further differentiated from other apartment brokerages by offering

a comprehensive network of submarket-based professionals that believe

in providing superior investor representation, advisory and advocacy.

OUR VALUES

Individual initiative balanced with collaboration and teamwork

Aggressive advocacy combined with integrity and trust

Creativity joined with discipline and focus

Knowledge and expertise put into action

Our values refl ect our group’s understanding that we must build client

relationships in order for us to further build our business. Experience

and market specifi city has been the foundation for our past success and

will remain so in the future. We are dedicated to Northern California’s

apartment investors and work had to maintain this commitment.

VINAY BHATIAVice President

650.320.0241

[email protected]

Lic #01854270

Vinay Bhatia’s Bio

BACKGROUND & EXPERIENCE

Vinay joined Cassidy Turley in the fall of 2008 focusing his energies

as an Investment Specialist on the apartment submarkets of Santa

Clara County. Prior to joining Cassidy Turley, Vinay worked within the

banking industry as well with an online advertising agency, where

he worked closely to build long-term relationships with successful

players within these markets.

PROFESSIONAL RECOGNITION

#1 Agent at Cassidy Turley under 5 years in the business in 2013 - Rising Star Award

#6 Agent at Cassidy Turley under 5 years in the business in 2012

EDUCATION

San Jose State University / B.S. in Marketing

Visit www.ctbtapartments.com for more information.

VINAY BHATIA


650.320.0241 | [email protected] | Lic #01854270

Sales Summary

Real Estate Transactions by Vinay Bhatia in 2012 - 2014

Sale Date Address City Units SqFt Sale Price Representation

Listed1375 San Tomas Aquino

PkwySan Jose 4 2,764 Call Vinay for More Details Listing Cause

Listed 2341 Cooley AvenueEast Palo

Alto17 12,148 Call Vinay for More Details Listing Cause

Pending 524 S. 9th Street San Jose 25 17,652 Call Vinay for More Details Both Procuring and Listing

8/1/2014 515 Boynton Avenue San Jose 31 21,012 Call Vinay for More Details Both Procuring and Listing

5/15/2014 483 S. Buena Vista Avenue San Jose 12 7,580 $1,900,000 Both Procuring and Listing

5/15/2014 450 N. Winchester Blvd Santa Clara 7 4,154 $1,525,000 Both Procuring and Listing

4/2/2014 1844 Park Avenue San Jose 12 6,660 $3,100,000 Procuring Cause

4/15/2014 593 Saratoga Avenue Santa Clara 8 3,524 $1,800,000 Both Procuring and Listing

2/12/2014 3201 Cadillac Drive San Jose 10 6,054 $1,750,000 Both Procuring and Listing

12/14/2013 977 N. 7th Street San Jose 7 4,004 $1,100,000 Procuring Cause

11/30/2013 341 Menker Avenue San Jose 5 1,816 $550,000 Both Procuring and Listing

11/16/2013 2991 Magliocco Drive San Jose 24 17,016 $4,500,000 Both Procuring and Listing

10/29/2013 Boston Market Plano, TX NNN 3,128 $2,958,354 Procuring Cause

10/28/2013 4860 Northlawn Drive San Jose 12 10,312 $2,725,000 Both Procuring and Listing



Sales Summary


9/30/2013 3591 Lafayette Street Santa Clara 4 3,456 $885,000 Listing Cause

8/13/2013 1168 Ayala Drive Sunnyvale 4 3,000 $1,020,000 Listing Cause

8/21/2013 636-640 S. 9th St San Jose 23 10,892 $2,935,000 Procuring Cause

8/13/2013 664 Morse Avenue Sunnyvale 12 6,910 $2,550,000 Procuring Cause

1/18/2013 991 Richard Avenue Santa Clara Industrial 8,000 $1,200,000 Listing Cause

3/1/2013 361 S. Buena Vista Avenue San Jose 3 2,188 $525,000 Listing Cause

5/25/2013 2994 Van Sansul Avenue San Jose 17 13,232 $3,175,000 Both Procuring and Listing

7/1/2013 2129 Monroe Street Santa Clara 4 3,270 $925,000 Listing Cause

6/1/2013 2371 Sutter Avenue Santa Clara 12 6,876 $2,400,000 Both Procuring and Listing

6/1/2013 470 California Street Santa Clara 8 6,386 $1,595,000 Both Procuring and Listing

7/1/2013 Private Sale San Jose 20-30 21,425 Call Vinay for More Details Both Procuring and Listing

6/15/2013 1007 Leigh Avenue San Jose 12 6,260 $1,695,000 Procuring Cause

11/5/2012 953 Helen Avenue Sunnyvale 14 9,782 $2,500,000 Both Procuring and Listing

10/23/2012 Carls Jr/ Hardee's Union, SC NNN 3,372 $1,640,511 Procuring Cause

VINAY BHATIA



Sales Summary


10/23/2012 Carls Jr/ Hardee's Cowpens, SC NNN 2,390 $1,211,160 Procuring Cause

9/12/2012 645 Nido Drive Campbell 4 3,928 $890,000 Listing Cause

9/12/2012 2883 Old Almaden Road San Jose 10 8,987 $1,705,000 Listing Cause

9/12/2012 528 S. Mathilda Avenue San Jose 8 5,276 $1,475,000 Both Procuring and Listing

8/1/2012 2137 Main Street Santa Clara 4 3,928 $715,000 Listing Cause

8/6/2012 778 Teresi Court San Jose 6 3,500 $825,000 Both Procuring and Listing

7/18/2012 1125 Delna Manor Lane San Jose 4 4,219 $900,000 Listing Cause

4/25/2012 3725 Miramar Way Santa Clara 14 8,860 $2,140,000 Procuring Cause

12/11/2012 357 Rutland Avenue San Jose 3 1,580 $430,000 Listing Cause

12/11/2012 1151 Ayala Drive Sunnyvale 4 3,072 $965,000 Listing Cause

11/5/2012 1207 Leigh Ave San Jose 8 4,808 $1,180,000 Listing Cause

12/11/2012 Carls Jr/ Hardee's Opelika, AL NNN 3,513 $1,430,000 Procuring Cause

11/5/2012 2991 Magliocco Drive San Jose 24 17,016 $3,775,000 Procuring Cause



Address Type Sq Ft Rent $/Sq Ft Rental Features

455 E St. John St

San Jose, CA 95112Studio 400 $1,150 $2.88

Street Parking Only. Private Backyard. Renter Pays a Portion

of Water. Renter Pays a Portion of Electricity. $10/ Month for

Internet. Renters Insurance Required

1058 N 4th St


Walk-in closet. Offi ce. Range / Oven. Refrigerator. Sprinkler

system. Double pane / Storm windows. Cable-ready. Hardwood

fl oor. High / Vaulted ceiling

333 N 5th St

San Jose, CA 951121+1 700 $1,425 $2.04

Living room. Dining room. Walk-in closet. Master bath. Range /

Oven. Refrigerator. Ceiling fans. Cable-ready. Tile fl oor

93 E William St

San Jose, CA 951121+1 600 $1,450 $2.42

Upstairs Apartment. New Carpet. Fresh Paint. Near

San Jose State. A/C. On-Site Laundry

76 N 10 St

San Jose, CA 951121+1 $1,495

Living room - Storage space- Freezer - Microwave -

Refrigerator- Stove/Oven

530 N First St

San Jose, CA 951121+1 500 $1,850 $3.70

Hardwood fl ooring *Designer tile fl ooring in Kitchen & Bath

*Fresh designer paintcolors *Some units with A/C *New

appliances *Front and Back door entrances *Upgraded Cabinetry

*Laundry Room on site *Double paned windows

1040 N 4th St

San Jose, CA 951121+1 750 $1,525 $2.03

Living room. Range / Oven. Refrigerator. Double pane / Storm

windows. Hardwood fl oor

211 N 27th St

San Jose, CA 951161+1 750 $1,525 $2.03

Living room. Range / Oven. Refrigerator. Heat: forced air. Air

conditioning. Hardwood fl oor. Tile fl oor. Granite countertop

2050 McKee Rd

San Jose, CA 951162+1 834 $2,035 $2.44

Living room. Dining room. Range / Oven. Refrigerator.

Dishwasher. Garbage disposal. Balcony, Deck, or Patio.

Heat: forced air. Air conditioning

159 S Morrison Ave

San Jose, CA 951262+1 750 $1,700 $2.27

Living room. Storage space. Breakfast nook. Range / Oven.

Refrigerator. Garbage disposal. Hardwood fl oor.

Granite countertop

Rent Survey

VINAY BHATIA




1194 Leigh Ave

San Jose, CA 951262+1 900 $1,895 $2.11

Laminate fl ooring through out the apartment and the bedrooms.

Ceramic titles in the bathroom and the kitchen fl oor

125 Topeka Ave

San Jose, CA 951161+1 550 $1,395 $2.54 Air conditioning, parking, laundry

411 Clifton Ave

San Jose, CA 951281+1 400 $1,450 $3.63

The kitchen includes refrigerator and gas stove and oven. It is

an downstairs unit with one designated covered parking space.

There is a storage unit in the carport.

968 College Dr

San Jose, CA 951281+1 640 $1,482 $2.32

New refi nished original hardwood fl oors- custom granite kitchen

counters with full backsplash- custom tiled fl oors- custom tiled

shower / tub- vanity/sink- paint throughout

469 Clifton Ave


Full Kitchen. Full Bathroom. Wall Heater. Closet and

shelving. Hardwood Floor/Tile Flooring. Ceiling Fan.

Garbage Disposal. Patio

2952 Magliocco Dr

San Jose, CA 951281+1 700 $1,595 $2.28

Spacious Bedroom with double closets.- Full bath in the hall

way to share with guests.- Good size living room adjoining the

kitchen.- Pool.- On-site coin-operated laundry room.- Carport

parking and storage area.- Water and garbage paid.

3687 Greenlee Dr

San Jose, CA 951171+1 700 $1,495 $2.14

Carpet in living room and bedroom, tile fl oor in kitchen and

bathroom. Water and garbage included. Refrigerator. Air

conditioning in living room.. Electric range. Large living room

and bedroom. Carport parking space. Laundry facility on-site

458 Boynton Ave

San Jose, CA 951171+1 660 $1,685 $2.55 Stove - Balcony - Dishwasher - Complete Appliance Package

3909 Williams Rd

San Jose, CA 951172+1 750 $1,890 $2.52

Private Washer and Dryer, Refrigerator, Microwave, Garbage

Disposal, Stove. Dual Glaze Windows, New Froced Air Furnace

1120 Ranchero Wy

San Jose, CA 951172+1 1025 $1,950 $1.90

Living room. Dining room. Storage space. Range / Oven.

Refrigerator. Garbage disposal. Balcony, Deck, or Patio. Heat:

forced air. Air conditioning. Ceiling fans. Double pane / Storm

windows. Cable-ready. Wired. Hardwood fl oor

Rent Survey


Rent Survey


458 Boynton Ave

San Jose, CA 951172+2 870 $2,090 $2.40

Cable or Satellite Ready-Oversized Closet(s)-Patio or Balcony-

Satellite hook-up-Serene setting-New carpets.

1440 Essex Wy

San Jose, CA 951173+2 $2,795

New kitchen with granite counter tops - New appliances - New

heater and a/c installed - Both bathrooms brand new - New

hardwood fl oors - Newer washer and dryer - Gas fi replace - 2 car

garage.

4899 Campbell Ave

San Jose, CA 951301+1 654 $1,595 $2.44

Living room. Dining room. Range / Oven. Refrigerator.

Microwave. Balcony, Deck, or Patio

4482 Hamilton Ave

San Jose, CA 951301+1 $1,650

Garage. Eat-in kitchen features a new stove, oven, Pergo fl ooring

and ceiling fan. Living room has Pergo fl ooring and fresh paint.

Remolded bathroom with shower over tub. Laundry facility on

site. Water and garbage included.

4431 Hamilton Ave

San Jose, CA 951301+1 700 $1,700 $2.43

Shared Garage with automatic opener and Small Backyard.

Laminated Flooring throughout, updated kitchen with tile

fl ooring. Ceiling fan in kitchen and bedroom

4747 Atherton Ave

San Jose, CA 951302+1 900 $1,795 $1.99

Range / Oven. Refrigerator. Dishwasher. Garbage disposal.

Air conditioning. Ceiling fans. Double pane / Storm windows.

Cable-ready. Intercom system

4899 Campbell Ave

San Jose, CA 951302+1.5 970 $1,895 $1.95

Living room. Range / Oven. Refrigerator. Heat:

forced air. Cable-ready

4899 Campbell Ave

San Jose, CA 951303+2 1387 $2,495 $1.80

Living room. Walk-in closet. Master bath. Range / Oven.

Refrigerator. Balcony, Deck, or Patio. Hardwood fl oor

321 Dunster Dr

Campbell, CA 950081+1 $1,350

Carpet, vinyl. Gas appliances. 1 covered parking space.

Coin operated laundry facility on-site

430 Dunster Dr

Campbell, CA 950081+1 $1,395 Carport Parking. Water & Garbage Paid

VINAY BHATIA




343 Kuehnis Dr

Campbell, CA 950081+1 $1,595

Eat-in kitchen with tile counters, refrigerator, gas range, Hall

bath with tile fl oors, shower over tub, shared laundry, 1 covered

carport parking, front & back entrance

260 N. San Tomas Aquino Rd

Campbell, CA 950082+1 $1,625

Kitchen includes: gas stove and refrigerator - Large kitchen-

Balcony - Laundry facility on-site - Two assigned parking space

- Water and garbage paid

620 Gamma Ct

Campbell, CA 950082+1 825 $1,950 $2.36

Custom Kitchen Cabinets. Granite Counter-tops. Hardwood Floor.

New Appliances. New Blinds. Freshly Painted

501 W Hacienda Ave

Campbell, CA 950082+1 900 $1,950 $2.17

Granite Kitchen Counters-Refrigerator-Dishwasher-Private

Balcony-Functional fl oor plan-In bedroom closets

76 Lester Ave

San Jose, CA 951252+1 850 $1,995 $2.35

Electric stove/oven. New Refrigerator. Garbage Disposal. Granite

Kitchen Counter Tops. Fireplace. Forced Air Heating. Shared

Garage. Separate Laundry Room w/ Washer & Dryer Hookups

Rent Survey


Activity report

Status Address List Price Age DOM # of Units Sq Ft. Lot Size Sale Price COE Date

ACTIVE 110 Graham Ave $3,040,000 64 64 16 10,30014,000

Sqft***** *****

ACTIVE 1755 Hester Ave $2,350,000 61 8 12 6,36516,500

Sqft***** *****

ACTIVE 643 S. 8th St $2,099,000 54 19 8 7,3925,739

Sqft***** *****

ACTIVE 1237 W. San Carlos St $1,999,000 114 82 6 5,00015,500

Sqft***** *****

ACTIVE 1739 McLaughlin Ave $1,688,888 59 5 6 4,96014,764

Sqft***** *****

ACTIVE 139 E. Julian St $1,600,000 116 28 9 4,0544,792

Sqft***** *****

ACTIVE 1202 E. Santa Clara St $1,590,000 56 41 7 4,6608,905

Sqft***** *****

ACTIVE 430 N. 2nd St $1,348,000 116 156 8 3,2326,348

Sqft***** *****

ACTIVE 373 Gloria Ave $1,188,000 69 17 5 3,73021,804

Sqft***** *****

ACTIVE 143 W. Reed St $1,125,000 66 41 6 3,3767,776

Sqft***** *****

PENDING 25 S. 10th St $1,600,000 96 33 8 5,5447,500

Sqft***** *****

PENDING 2129 Randolph Dr $1,100,000 58 56 6 2,9886,200

Sqft***** *****

PENDING 616 S. 8th St $2,950,000 59 35 14 7,467 1 Acres ***** *****

PENDING 5390 Carryback Ave $2,900,000 34 32 14 12,29227,500

Sqft***** *****

PENDING 807 Deland Ave $1,250,000 53 12 6 4,8588,439

Sqft***** *****

PENDING 1050 S. 12th St $6,000,000 50 37 34 21,52023,920

Sqft***** *****

PENDING 2238 Tomasina Ct $1,295,000 53 6 6 4,64210,500

Sqft***** *****

PENDING 1504 Alum Rock Ave $3,000,000 64 8 23 23,96632,046

Sqft***** *****

SOLD 389 Clifton Ave $1,088,888 57 48 6 3,5886,098

Sqft$1,088,888 Jan-14

SOLD 563 Avalani Ave $950,000 49 81 6 5,1458,100

Sqft$950,000 Feb-14

VINAY BHATIA



Activity report


SOLD 387 Clifton Ave $1,088,888 58 109 6 3,5886,098

Sqft$1,084,444 Feb-14

SOLD 256 N. 3rd St $1,455,000 73 14 6 5,6007,405

Sqft$1,490,000 Feb-14

SOLD 2127 Fruitdale Ave $1,100,000 54 134 6 3,087 6,200

Sqft $1,100,000 Feb-14

SOLD 3201 Cadillac Drive $1,750,000 56 0 10 6,054 9,072

Sqft $1,750,000 Feb-14

SOLD 625-631 S. 10th St $1,990,000 57 0 12 7,04810,769

Sqft$1,990,000 Mar-14

SOLD 142-150 Graham Ave $4,500,000 57 178 30 17,01821,890

Sqft$4,500,000 Mar-14

SOLD 264 La Pala Dr $5,450,000 55 0 36 21,56035,840

Sqft$5,450,000 Mar-14

SOLD 1600 Petersen Ave $11,450,000 51 14 40 41,00061,500

Sqft$11,450,000 Mar-14

SOLD 751 S. 2nd St $2,250,000 50 0 16 9,700 8,451

Sqft $2,250,000 Apr-14

SOLD 524 S. Willard Ave $1,500,000 56 7 12 6,096 10,032

Sqft $1,500,000 Apr-14

SOLD 1844 Park Ave $2,995,000 51 14 12 10,650 12,200

Sqft $3,100,000 Apr-14

SOLD 180 Rainier St $1,410,000 66 30 8 3,3023,977

Sqft$1,410,000 Apr-14

SOLD 3233 Cadillac Dr $1,750,000 56 13 10 6,0549,072

Sqft$1,730,000 May-14

SOLD 642 S. 7th St $3,200,000 53 21 12 12,3257,468

Sqft$3,100,000 May-14

SOLD 232 N. 8th St $2,500,000 60 117 12 6,1409,660

Sqft$2,482,000 May-14

SOLD 483-89 S. Buena Vista Ave $1,900,000 64 0 12 7,58027,195

Sqft$1,900,000 May-14

SOLD 122 Graham Ave $2,685,000 62 0 18 12,15012,910

Sqft$2,685,000 May-14

SOLD 561 S. 7th Street $1,198,000 64 19 6 4,4806,348

Sqft$1,188,000 Jun-14

SOLD 1610 Park Avenue $1,500,000 34 6 5 5,5647500

Sqft$1,525,000 Jun-14

SOLD 1326 Danube Way $1,325,000 53 6 8 4,5919,040

Sqft$1,275,000 Jun-14


Activity report


SOLD 495 E. William Street $2,675,000 55 0 12 10,20010,019

Sqft$2,675,000 Jun-14

SOLD 795 Deland Ave $1,384,000 53 19 7 4,4587,560

Sqft$1,384,000 Jun-14

SOLD 721 Menker Ave $1,300,000 51 0 8 6,58010,019

Sqft$1,300,000 Jul-14

SOLD 581 Avalani Ave $1,324,950 49 70 6 5,3668,100

Sqft$1,299,950 Jul-14

SOLD 587 Avalani Ave $1,324,950 49 70 6 5,3668,100

Sqft$1,299,950 Jul-14

SOLD 427 S. 3rd St $900,000 116 38 6 2,8645,341

Sqft$800,000 Jun-14

Please call Vinay for additional off-market deals not listed here.

VINAY BHATIA



Bay Area Region Overview

BAY AREA

Multi-Family Market Snapshot



BAY AREA


VINAY BHATIA




BAY AREA




SOUTH BAY


VINAY BHATIA




SOUTH BAY



Rents Are On The Rise The Silicon Valley office market ended Q2 2014 with a vacancy rate

of 10.8%. This is down from the 11.2% rate that was in place at the

end of Q1 and is the lowest level of vacancy that the market has

recorded since Q4-2007. The market posted 731,000 square feet

of occupancy growth during the quarter. This marks the sixteenth

consecutive quarter of positive net absorption and is well above the

quarterly average of roughly 500,000 square feet of occupancy

growth per quarter that has been in place since 2010.

After a slow Q1 in which we tracked only 1.8 million square feet of

total deal activity, the market saw a return to robust gross

absorption figures in Q2. We tracked nearly 2.6 million square feet

of closed deals over the past three months—a figure that is much

more in line with the average quarterly metrics of the previous three

quarters (2.5 million square feet) than it was with Q1’s more

subdued performance. Several large deals helped to bolster

absorption levels in Q2. The largest is Ericsson who took two

buildings totaling 412,000 square feet in Irvine’s new project Santa

Clara Square. Irvine currently has Phase I under construction –

three buildings totaling 600,000 square feet – completion is

scheduled for Q3-2015. The entire project is slated to be up to 1.2

million square feet. Apple, who had several large transactions in the

R&D sector, also renewed a 103,000 square foot office building in

Cupertino.

The average asking rate for office product continues to increase

ending Q2 at $3.12 per square foot (on a monthly full service

basis). This number stood at $3.00 per square foot last quarter,

reflecting strong quarterly growth of 4% and we anticipate that

rents will continue to increase. The 101 Tech Corridor cities

command the highest rents coming in at an average of $5.81 per

square foot. The West Valley and Central Silicon Valley cities

average in the high $2.00 range – West Valley at $2.95 per square

foot and Central Silicon Valley at $2.74 per square foot. A key

factor for the increasing rents is the speculative class A space

coming online. The Irvine Company’s Santa Clara Gateway is now

shell complete. They have two full buildings totaling 300,000

SILICON VALLEY OFFICE

Economics Indicators

Q2 13 Q2 14 12-Month

Forecast

Santa Clara Co. Employment 866K 881K

Santa Clara Co. Unemployment 6.8% 5.2%

U.S. Unemployment 6.7% 6.3%

Market Indicators

Q2 13 Q2 14 12-Month Forecast

Overall Vacancy 12.0% 10.8%

Net Absorption SF 450K 731K

Under Construction SF 1.6M 4.2M

Net Absorption/Asking Rent (FS)

4Q TRAILING AVERAGE

Overall Vacancy

Average Asking Rent (FS) $2.91 $3.12

$2.50

$2.60

$2.70

$2.80

$2.90

$3.00

$3.10

$3.20

-1

0

1

2

3

4

2010 2011 2012 2013 2014

4Q Trailing Net Abs.(MSF)

Avg Asking (FS)

0%

4%

8%

12%

16%

20%

2010 2011 2012 2013 2014

Historical Average = 14.1%

Offi ce Market Snapshot

SILICON VALLEY


VINAY BHATIA



square feet available. A couple quarters ago they took one

building and divided down to spaces as small as 4,800 square

feet. This building is now fully leased or has leases pending.

Their asking rate is $3.25 per square foot NNN with $.76 per

square foot expenses which equates to approximately $4.00 per

square foot full service.

The Silicon Valley average deal rate for Q2 was $4.15 per square

foot full service, down slightly from Q1’s rate of $4.46 per square

foot. As expected the highest average deal rates are in the 101

Tech Corridor cities at $6.27 per square foot. The West Valley

deal rates average $3.32 per square foot and the Central Silicon

Valley cities average $3.57 per square foot.

Although the vacancy decreased this quarter we expect it to

increase throughout the remainder of 2014 and 2015 as several

spec projects are now under construction. Jay Paul is under

construction on phase I, 3 buildings totaling 945,000 square feet

on his Moffett Place project in Sunnyvale. They are asking $3.75

per square foot NNN. The buildings are phasing completion with

the first scheduled for Q1-2015. The Irvine Company has also

broken ground on phase I of Santa Clara Square totaling 600,000

square feet. They are asking $3.50 per square foot NNN and

scheduled for completion by Q3 2015. As mentioned above, two

buildings have leased to Ericsson this quarter.

Average Asking Rate by Submarket (FS) NORTHERN CITIES COMMANDING RENTS

Availabilities by Size Segment LACK OF SUPPLY FOR QUALITY LARGE BLOCK SPACE

Average Asking Rate by Class (Full Service) CBD CLASS A RENTS INCREASED 19% SINCE 2010

Outlook

Asking rents are up 5% from one year ago, and are up

nearly 30% from the low point in 2005. The current

average asking rate is $3.12 per square foot full service.

Large deals by tech companies lead this quarter’s

activity.

The pipeline is still active with 14 requirements over

100,000 square feet.

4.2 million square feet of new office product is currently

NN

N

$6.35

$5.67 $5.46

$4.98

$4.42

$3.84

$3.24

$2.95 $2.92

$2.67 $2.55 $2.47

$2.22

$1.95 $1.93 $1.81

$0

$1

$2

$3

$4

$5

$6

$7

MP Mtv PA LA Cup Sun SC Cam Lgs/Sar N. SJ Airport Downtn W. SJ Fre S. SJ Mil

790

176

8354

0-5K

5-10K

10-20K

20K+

1,103Listings

$2.00

$2.10

$2.20

$2.30

$2.40

$2.50

$2.60

$2.70

$2.80

$2.90

$3.00

$3.10

$3.20

$3.30

$3.40

$3.50

$3.60

$3.70

2009 2010 2011 2012 2013 2014

Class A Class B

Cla

ss A

The Silicon Valley office market posted its

16th consecutive quarter of growth in Q2.

Cla

ss B




Key Lease Transactions Q2 14

PROPERTY SF TENANT LANDLORD TRANSACTION TYPE SUBMARKET

20525 Mariani Ave 103,638 Apple, Inc. Menlo Equities, LLC Renewal Cupertino

250 Bryant St 78,000 confidential 250 Bryant, LLC Relocation Mountain View

2953 Bunker Hill Lane 57,914 Inphi Corp. Sleepy Hollow Mgmt Expansion/Renewal Santa Clara

303 Bryant St 55,956 Quixey, Inc. Speck Product Design Sublease Mountain View

4555 Great America Pky 55,426 Barnes & Noble, Inc. Prudential Real Estate Relocation Santa Clara

2755 & 2795 Augustine Dr 412,492 Ericsson Irvine Company Relocation Santa Clara

Bold Text = Cassidy Turley Transaction

Key Investment Sale Transactions Q2 14

PROPERTY SF BUYER SELLER SALE PRICE SUBMARKET

3979 Freedom Circle 282,084 Prudential Real Estate Shorenstein Realty $131,169,060 Santa Clara

200 Middlefield Rd 41,260 TIAA-CREF Menlo Equities, LLC $50,025,000 Menlo Park

4085 Campbell Ave 58,963 Goldman Sachs Harmony Capital Mgmt $47,000,000 Menlo Park

2105 S. Bascom Ave 122,000 Carlyle Group Legacy Partners $40,870,000 Campbell

111 N. Market St & 111 W. St. John 309,235 Swift Realty Partners John Feece $40,000,000 Downtown San Jose

INVENTORY SUBLET VACANT DIRECT VACANT

VACANCY RATE

CURRENT NET

ABSORPTION

YTD NET ABSORPTION

UNDER CONSTRUCTION

AVERAGE ASKING RENT (ALL

Classes)

AVERAGE ASKING RENT

(CLASS A)

Submarket

Menlo Park 3,618,034 54,341 288,937 9.5% 30,067 75,496 465,955 $6.35 $6.66

Palo Alto 9,221,636 41,986 250,668 3.2% 23,877 82,365 99,529 $5.46 $5.83

Los Altos 1,091,024 0 49,241 4.5% 41,389 50,685 0 $4.98 $5.08

Mountain View 3,614,053 175,147 85,325 7.2% 15,136 (39,625) 803,976 $5.67 $6.29

Cupertino 4,103,740 1,942 113,557 2.8% (41,220) (69,614) 259,796 $4.42 $4.82

Campbell 2,321,905 54,911 223,222 12.0% (13,099) (14,262) 0 $2.95 $3.36

Los Gatos/Saratoga 1,970,186 1,300 118,303 6.1% 35,613 8,565 30,000 $2.92 $0.00

West San Jose 3,777,382 27,794 203,038 6.1% 60,857 28,870 0 $2.22 $3.22

Sunnyvale 7,301,105 38,162 290,336 4.5% (30,141) (14,091) 1,527,245 $3.84 $4.36

Santa Clara 7,632,168 125,930 1,188,797 17.2% 504,462 513,840 406,500 $3.24 $3.55

San Jose Airport 3,730,710 42,031 530,953 15.4% 43,331 76,305 0 $2.55 $2.79

North San Jose 3,844,041 159,847 949,864 28.9% (87,683) (90,167) 650,000 $2.67 $3.16

Alameda/Civic Center 2,249,215 5,889 204,275 9.3% 19,180 16,737 0 $1.74 $0.00

South San Jose 1,588,218 11,504 301,929 19.7% (10,363) (8,911) 0 $1.93 $2.17

Downtown San Jose 8,410,290 61,158 1,390,051 17.3% 105,307 171,680 0 $2.47 $3.00

Milpitas 955,137 4,123 61,783 6.9% 36,239 36,382 0 $1.81 $1.81

Fremont 2,504,718 11,917 236,805 9.9% (1,844) 6,794 0 $1.95 $2.17

Office Class Breakdown

Class A 34,125,391 605,994 3,364,482 11.6% 513,670 728,714 4,243,001 $3.66

Class B 19,563,652 137,784 1,875,478 10.3% 163,209 148,960 N/A $2.69

TOTAL 67,933,562 817,982 6,487,084 10.8% 731,108 831,049 4,243,001 $3.12 $3.66

SILICON VALLEY


VINAY BHATIA



Apartment rents skyrocket in second quarter, putting Silicon Valley at record highsBy Nathan Donato-WeinsteinReal Estate Reporter

Silicon Valley Business JournalPOSTED: Jul 15, 2014, 1:42pm PDT

UPDATED: Jul 15, 2014, 2:55pm PDT

If you thought apartment rents in Silicon Valley, already sky-high, had reached their limit, well… think again. Santa Clara County

monthly rents soared on average $124 in the second quarter compared to the fi rst three months of the year, according to the latest

numbers from apartment tracker RealFacts, released today. They’re up 9 percent year over year.

“It’s summer fever,” said Nick Grotjahn of RealFacts, based in Marin County. “The only thing that can pay for these rents is the

high-tech employment. That’s the driving force behind these rents that are north of $2,000 a month.” The latest numbers are

notable because average rents had been showing slow, steady quarterly increases of $30 to $50. They have not zoomed up by

this much in the past couple of years.The rent growth seemed so aggressive that I reached out to Axiometrics, another respected

apartment data tracker, to see if they’re showing similar increases. The fi rm said effective rents in the San Jose metro area jumped

$100 a month in the second quarter. That’s less of an increase than RealFacts’ data, but the fi rm also showed accelerating

increases. Ross Coulter, a spokesman for Axiometrics, said that most of the rent growth in the last year came from the April through

June period. According to RealFacts, the average apartment rent for all unit types was $2,321 in Santa Clara County, compared to

$2,197 in Q1 and $2,128 a year ago.

In San Mateo County, the average was $2,470, up $110 from the previous quarter. That compares to $2,284 a year ago, an 8.1

percent increase. Grotjahn said that the latest fi gures represent the highest rents ever for the area, but they are not adjusted for

infl ation. It’s the region’s jobs engine that is pushing the rents higher, said Lawrence A. Souza, an economist and principal with

Johnson Souza Group Inc. He noted that the San Jose metro area has added 72,000 jobs in the last two years — a growth rate

that would require 12,500 new units to come online just to keep up with the additional demand. “That’s basically dot-com levels,”

Souza said. “This is ‘98, ‘99, 2000 all over again. Santa Clara County is now one of the top destinations for in-migration and

population growth.”

RealFacts shows that 12 communities, totaling 3,996 units, were built and delivered starting in 2013 in Santa Clara County. That

compares to 3,139 for the four years prior. But despite the additional construction, occupancy remained very high in Q2 — a sign

that all additional units coming online are being quickly snapped up by renters. Normally, additional properties would result in

a dip in occupancy. But Santa Clara County saw occupancy increase to 96 percent, up from 94.1 percent in the fi rst quarter. At

Santana Row, San Jose’s marquee mixed-use project from Federal Realty Investment Trust, construction just wrapped up in June

on the fi nal phase of 212-unit luxury project called Misora. It’s now 95 percent leased at very strong rents. “We’re beating all of our

occupancy goals by far,” said Collette Navarette, director of marketing for Santana Row. “We did not think that, upon completion of

the (fi nal) building at the end of June, we would only have eight units left.”

Rents range from $1,875 for a studio to $9,065 for the highest-end loft. The pricey fi gure buys you access to amenities like

multiple pools, a wine-tasting room, fi replace room, lounges and a swanky fi tness center. ( Take a peek inside these apartments).

“I think it’s all the amenities,” Navarette said. “What we’re seeing most in terms of demand is for our one bedrooms. It’s a lot of

Silicon Valley single employees. We also have a lot of empty nesters that are renting our higher-priced units.” The countywide average

is for all unit types. For one bedrooms, the average was $2,082, up from $1,978 and the fi rst time I can fi nd record of the county

average crossing the $2,000 threshold for one bedroom units. One bedrooms in Palo Alto will set you back $2,802 (up $144 from

Q1); Mountain View, $2,381 (up $152); Sunnyvale, $2,095 (up $120); and San Jose, $1,945 (up $77).

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Souza added a caveat to the second-quarter numbers, noting that the period from April through the summer is traditionally peak

renting season. He said it was unlikely future quarters would see growth like the second quarter. “At some point, there will be a

limit and the acceleration will start to slow down,” he said. Grotjahn agreed. “I don’t think you can raise it $400 in a year,” he

said. “There’s going to be a tipping point. I don’t believe $124 in a quarter, which equates to $500 a year, I don’t think that’s

sustainable.” There is some risk for landlords if they push rents too high because it could spur calls for rent control ordinances.

High rents also push developers to respond by pushing new projects. But for now, many renters with tech-industry paychecks

appear willing to pay the high cost of admission for living here. “They’re not going to complain — they just need housing,” Souza said.

“They’re willing to double up and triple up. If you’re making $100,000 and you’re doubling up, that’s gross income of $200,000 of

household income. You can spend $6,000 a unit.”

Source: http://www.bizjournals.com/sanjose/news/2014/07/15/apartment-rents-skyrocket-in-second-quarter.html?ana=e_du_pub&s=article_

du&ed=2014-07-15&u=Zvzw4nrOanTk6pxwUjIkiw07291420&t=1407436204&page=all

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VINAY BHATIA



Bay Area apartment rents continue relentless rise on tight supplyBy Pete CareyReal Estate Reporter

mercurynews.com

Bay Area apartment rents reached a record high in the second quarter, according to a report Tuesday, continuing a three-year run of

steady increases that’s setting off alarms among economists and corporate leaders.

Rents averaged $2,158 a month in the nine-county Bay Area, a nearly 20 percent gain since the second quarter of 2011, and a

10.3 percent jump from the same period last year, according to Novato-based RealFacts. Rents were up 5.6 percent from the fi rst

quarter.

Alameda County saw the biggest percentage gain -- up 12 percent from a year ago to an average rent of $1,928 a month. The

area’s under pressure partly because of refugees from San Francisco, where rents averaged $3,229 in the second quarter, a 9.4

percent annual gain. The San Francisco metro area has the highest rents among the country’s 25 largest rental markets, according

to online real estate site Trulia.

The average apartment rent was up 9 percent to $2,321 in Santa Clara County; up 8 percent to $1,609 in Contra Costa County and

up 8.1 percent to $2,470 in San Mateo County.

A limited supply and strong demand are responsible, economists and housing experts say. They worry that continued job growth in

the region -- boosted by the remarkable boom in tech --- is unsustainable without similar growth in housing.

“All of these companies are hiring and new people are coming in from around the world and around the country,” said Stephen Levy

of the Center for Continuing Study of the California Economy in Palo Alto. “They’re good jobs and they’re bidding against a limited

supply of apartments. It’s both a sign of strong job growth and a sign we need to give it attention.”

Jim Wunderman, president and chief executive of the Bay

Area Council, said the region needs to work together to build

more housing.

“There needs to be a partnership between cities, counties and

companies to get housing built fast so that we can enable the

growth pattern to continue,” he said. “Otherwise, it forces labor

costs up because a company has to pay more because of the

rising cost of living. They’ll do that for a while, but eventually

they’ll start looking for alternatives.”

Housing has consistently been the top concern in a survey of

corporate executive members of the Silicon Valley Leadership

Group, said Shiloh Ballard, the group’s housing analyst. “We’re

not achieving the number of homes to keep pace with demand,

and we see that with increased rents.”

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The relentless gain in rents has people such as single mom Waynetta Mills, an insurance agency account executive who lives in

Dublin in the East Bay but works in San Mateo on the Peninsula, planning to lengthen her commute.

“As a single mother of two, I have no choice but to move farther out to be able to afford to live,” said Mills, whose rent for a

two-bedroom apartment in Dublin was just raised 9 percent to $2,180 a month.

“I’m not looking forward to commuting from the Suisun-Vallejo region all the way to San Mateo, but at this point I really have no

choice,” she said.

Linda Nichols, who operates a day spa in Menlo Park, struggled to fi nd another apartment after receiving a 60-day move-out notice

from new owners.

“I was born and raised here, but honestly I don’t know how much longer I’m going to be able to stay,” Nichols said. “It’s sad. I’m

going to have to sell a good business.”

Nick Grotjahn of RealFacts said that “for apartment owners and developers this is all good news, but for renters and especially your

average renter in the Bay Area, not your high-tech worker, it’s really putting the squeeze on you.”

RealFacts measures rents in apartment complexes and townhomes of more than 50 units, so the prices -- which are averages of all

sizes of apartments -- tend to be higher than for smaller developments.

Ron Stern of Bayrentals.com, which lists smaller complexes and houses for rent around the Bay Area, said he’s seen rents increase

20 percent in the past few years. “Even apartment managers are shocked at what they have to charge in rent now,” he said.

RealFacts said Bay Area apartment rents in large complexes ranged from an average of $1,859 for a studio to $2,868 for a

two-bedroom, two-bath apartment and $3,258 for a three-bedroom townhouse.

According to RealFacts, San Jose had an average apartment rent of $2,169, Oakland $2,421 and Concord $1,418. Patricia De La

Torre, who works for a semiconductor company and lives in a three-bedroom townhouse in Mountain View, is looking for a second

job “just for the extra spending money.” Two of her sons have graduated from high school but the other two are still in school and

her rent is nearly $3,000 a month. “It’s so hard to balance everything out,” she said.

Ruben Holmes left San Jose after 30 years there and moved to Mountain House in San Joaquin County where he rents a

fi ve-bedroom, three-bath house for $1,600 a month.

“I never thought I would leave San Jose,” said Holmes, who has an Internet business and works from home.

Effi e Moore of San Jose said she knows people who are moving to Sacramento and Patterson in the San Joaquin Valley.

“I never heard of Patterson until I had friends moving there,” Moore said. “I’ve seen a lot of people moving out of the Bay Area. A

lot of friends are moving to Sacramento, and that’s what we’re going to end up doing so we can buy a home.”

Source: http://www.mercurynews.com/business/ci_26152150/bay-area-apartment-rents-continue-relentless-rise

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