Real Estate Forum - December 2008

CORPORATE

PERSPECTIVES

A Supplement to Real Estate Forum

December 2008

News watch

City Approves Nvidia HQ Development

Plans to replace a light industrial park in Santa Clara, CA with a 1.9-million-square-foot headquarters campus for computer graphics firm Nvidia Corp. were approved unanimously by the Santa Clara City Council. Nvidia’s current headquarters, which is leased, is located across the street from the development site.

Plans call for the existing low-rise flex-industrial buildings to be razed in favor of three eight-story structures built out for high-tech lab and office uses. Developed to achieve

LEED certification, the glass- and aluminum-paneled buildings are connected by elevated bridges. There would also be a pedestrian bridge over the San Tomas Aquino Creek,

which divides the development site.

The addresses involved are 2600 and 2800 San Tomas Expressway and 2400 Condensa St. In approving the project, the city council green lighted a rezone from light industrial and approved the phased development agreement, which includes approximately $5 million in traffic mitigation fees.

Nvidia acquired the property, San Tomas Business Park, in February for $149.5 mil-

lion. The seller was Harvest Properties and Blackrock Realty Advisors, which paid less than $100 million for the 25-acre, 10-building, 475,000-square-foot campus in 2006. A Nvidia source confirmed that Harvest Properties will develop the campus.

The developers could not be reached for comment on their timeline and did not discuss it at the recent hearing, though a city staff member did describe Nvidia and Harvest as “ready to move forward.” Steve Van Dorn, head of the Santa Clara Chamber of Commerce, told council members before the vote that this was the type of project chambers of commerce “dream about.”

“It wasn’t too long ago we were talking about Nvidia perhaps moving to another city,” he said.—Brian K. Miller, GlobeSt.com

OPUS WELCOMES YASKAWA
TO OAKWOOD CROSSINGS
Oak Creek, WI—Under a long-term lease,
Yaskawa Electric America Inc. will occupy
107,152 square feet at Oakwood Crossings
Business Center I, a 139,726-square-foot

“It wasn’t too long ago

we were talking about

Nvidia perhaps moving

to another city.”

Oakwood Crossings Business Center I

STEVE VAN DORN

SANTA CLARA CHAMBER OF COMMERCE

mixed-use facility here. The space will include 7,900 square feet of office acco-modations and 9,300 square feet of lab and general warehouse space. Occupancy is set for March of next year. The center is located within Opus North’s industrial park, Oakwood Crossings Business Center.

Workforce Planning Takes Center Stage

In light of the economic downturn, companies are putting more effort into aligning their workforce requirements and business strategy, according to Watson Wyatt Worldwide. The global consulting firm surveyed 129 North American-based employers across a variety of industries for its recent report.

“The current environment is bringing several workplace planning challenges to the surface,” says Jamie Hale, national practice leader of workforce planning at Watson

Wyatt. “While companies are under enormous pressure to cut short-term costs, it's important to consider the implications their actions will have on the firms' future workforce needs as well.”

Nearly 71% of those polled said the most pressing matter within their companies was the scarcity of talent. However, half of the employers said they had no intentions of ramping up efforts to replace skilled workers, while 33% will be scaling back on those efforts. Some 20% of those polled said they are dealing with hiring freezes.

About 42% of those polled said they are also facing restructuring and layoffs. “Having the right number of people performing in the right roles will be crucial for companies to position strongly for when the economy recovers,” says Hale.

OFFICE DEPOT TO CLOSE SITES THROUGHOUT NORTH AMERICA Delray Beach, FL—Over the next three months, locally based Office Depot Inc. will close 112 of its underperforming retail stores and six distribution facilities throughout North America. This accounts for roughly 9% of the office supply company’s retail locations, with an additional 14 stores to shutter next year as leases come due.

HUNTINGTON BANK TAKES 96,000 SF IN CLEVELAND Cleveland—Huntington Bank has signed a 20-year lease for 96,000 square feet of office space at 200 Public Square here. The company will occupy the sixth, seventh and a portion of the 11th floors as well as street-level retail space. The 45-story tower is owned by Harbor Group International.