Rockwood Capital dropped more than $1,000/SF for 130 Lytton, one of downtown Palo Alto's biggest office buildings, from KG-Lytton LLC. (Above, Rockwood's Bob Gray chats at our investment summit last year.) The 50k SF building's home to HQ of A9, Amazon's search and ad tech subsidiary. The $53M sale (at $1,060/SF), is in line with other recent area trades. Others to break that $1,000/SF barrier: Premia Capital snapping up 555 Hamilton Ave for $13M and the sale of 661 Bryant St, fully leased to Tencent America.
Rockwood's buy is one of few larger buildings that sit adjacent to the Caltrain and can accommodate a large, single tenant. "The further you get from Caltrain the less desirable the area tends to be for tech companies," says CBRE's Joe Kelly. Downtown Palo Alto "remains a very small market" of about 2.5M SF, he notes, with only 10 or so buildings with floor plates above 10k SF in the downtown area. "Buildings like this trade very rarely," he says. (Though hopefully not as rare as Thanksgivukkah.)
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