Drawbridge Realty acquired a fully leased 2-year-old office building at 100 Altair Way in Sunnyvale for $219M, or $1,213 per SF, according to the Silicon Valley Business Journal.

The deal underscores the growing impact of artificial intelligence companies on commercial real estate not just in San Francisco but throughout the Bay Area.

The downtown Sunnyvale acquisition is slightly more than the $330M, or $1,034 per SF, that a Bluerock affiliate paid in early September for an eight-story, 319K SF office building at 1133 Innovation Way in Sunnyvale.

Drawbridge’s newest property is fully leased to Databricks, which earlier this year expanded from its San Francisco-based global headquarters at One Sansome Street to the South Bay.

The AI company's 180K SF lease at 100 Altair brought its Sunnyvale footprint to 635K SF, the SVBJ reported. Databricks also occupies 455K SF at the Sunnyvale Cityline office tower at 250 W. Washington Ave.

Spear Street Capital paid $807 per SF for a 150K SF office property in Mountain View, but most other office acquisitions in the third quarter traded hands for $450 per SF or lower, according to Kidder Mathews.

The South Bay’s growing presence in AI, combined with a limited development pipeline, has institutional capital seeking office plays throughout the San Francisco Peninsula and south to Silicon Valley.

“There’s just a tremendous velocity that is taking place with everything related to AI,” Drawbridge Realty Vice President of Investments Jaden Rosselli said in an interview with the SVBJ.

Other AI companies with a large presence in Silicon Valley include Figure AI, which has a 98K SF robotics research and development and manufacturing campus in San Jose, and OpenAI, which in Q1 leased a 450K SF office campus in Mountain View.

Office vacancy in Silicon Valley in Q3 dipped 30 basis points from the prior quarter to 15.9% on the strength of 491K SF of net absorption, according to Kidder Mathews. Total leasing volume in the quarter of nearly 3M SF was up 97% from the same quarter in 2025, with year-to-date leasing of just under 9M SF up 70% from the first nine months of the prior year.