A building that served as the longtime headquarters of a Silicon Valley mainstay sold to a San Francisco investor that specializes in "languishing, under-appreciated properties" for its lowest price in nearly 20 years.
Paceline Investors bought the 142,700-square-foot building at 350 E. Plumeria Drive in San Jose that until last year was fully leased by computer networking firm Netgear, a fixture in the San Francisco Bay Area tech world.
The purchase price was $33 million, several million below the nearly $38 million its last owner, Workspace Property Trust, paid for the property as part of a portfolio in 2022. In 2016, the then fully leased building sold for $44 million to a Southern California real estate investment trust.
Netgear, which makes networking equipment such as Wi-Fi routers, modems and other gear for homes and businesses, announced in late 2024 that it would relocate its global hub to a smaller space at 3553 N. First St. in San Jose. The shift to the 89,400-square-foot property echoed moves by many other office tenants following the COVID-19-spurred shift to remote or hybrid work.
Netgear departed the Plumeria Drive building when its leased expired in 2025 after about 17 years there; the building is now vacant.
Paceline was involved in a similar deal last month for a property built in the same era less than a mile away. The company partnered with the Roxborough Group to acquire 2581 Junction Ave. for slightly over $29 million; the tenant there makes ultrathin lithium batteries for wearable electronics and state-of-the-art hearing aids.
Paceline did not immediately respond to a request for comment on the deal.
Value-add deals
Built in 1984 and renovated in 2015, the Plumeria Drive property features a mix of office, lab and warehouse space. It also includes a cafeteria and a fitness room, according to its marketing brochure.
Paceline employs a "value-add" strategy and seeks to acquire underperforming or overlooked properties to improve or reposition.
“We are attracted to the building’s functional qualities and its existing electrical power infrastructure, which is rare for a building of this size in the Silicon Valley market,” Paceline Managing Principal Jay Atkinson said in a statement at the time of the Junction Avenue deal.
Silicon Valley is seeing growing demand from an array of tech companies: those that produce hardware, those that make chips and other artificial intelligence infrastructure, as well as robotics firms and others. San Francisco is fast becoming a hub for business-to-business AI startups as well as large language model giants such as Anthropic and OpenAI, said Alexander Quinn, senior director of research for JLL in Northern California.
North San Jose has emerged from the long slump of the pandemic years as a growing advanced manufacturing hub. Activity in the North San Jose office submarket is being driven primarily by semiconductor, hardware, AI‑adjacent and infrastructure‑oriented firms rather than traditional software users. Companies are prioritizing buildings that support engineering, research and development, and collaboration, according to CoStar Research.