Back to Press Room

In the News

July 24, 2015

Apple signs two big Santa Clara leases in fresh expansion

Contra Costa Times

George Avalos

Santa Clara became a new location for Apple in November 2012, when the company leased 260,000 square feet in two big office buildings owned by developer Peery Arrillaga. Last September, market sources say, Apple leased 60,000 square feet in a manufacturing building at 3250 Scott Blvd.

Earlier this month, Apple leased 290,000 square feet in an office building near the corner of Orchard Parkway and Charcott Avenue in North San Jose.

These leases, market experts say, represent expansions for Apple beyond the capacity of its new "spaceship" headquarters, now under construction in Cupertino.

The deals come as the tech sector has been on an expansion binge in Silicon Valley with Google, Facebook, LinkedIn, Apple and other companies spreading out to new buildings to accommodate more workers.

"The growth and demand is robust," said Jim McPhee, an executive vice president with Cushman & Wakefield, a commercial real estate firm. "I have seen nothing that indicates that tech companies are pulling back. All the tech companies are saying they are planning continued expansion of their operations and growth of their head count in Silicon Valley."

In many cases, companies are telling realty experts that they intend to expand their staffing levels by 10 percent a year over the next several years.

"You have corporate giants such as Apple and Google that are expanding, and they are often competing for space with smaller companies that are adding to their staff," said Kyle Nelson, a first vice president with commercial realty firm Kidder Mathews.

Apple and Mountain View-based Google surprised local experts by planting roots in Sunnyvale, outside their home territories. But since those deals a few years ago, both companies have continued a shopping spree to occupy and control more buildings in a growing number of cities.

What's more, the current leasing activity by numerous tech companies in Santa Clara County, San Mateo County and southern Alameda County is solid and not based on frothy valuations and business plans such as the ones that triggered the dot-com bubble.

"The companies leading the demand this time around in Silicon Valley are real companies, with real balance sheets, real profits and a lot of money in the bank," McPhee said. "They can also produce a lot of cash over the next several quarters."

Back to top