A Silicon Valley office park changed hands for substantially less than the price it last sold for a decade ago, a reminder that the AI-fueled recovery of the San Francisco Bay Area's office market is still in its early days.
DivcoWest partnered with Grove Real Estate Partners to buy the Campus at Trimble, a four-building research and development complex at 375-441 W. Trimble Road in San Jose, California. Records show that the off-market deal closed for $63.6 million, more than a third less than the $95.9 million the property sold for when MetLife Investment Management purchased it in 2015.
It's the latest purchase by DivcoWest, a San Francisco-based investor that has leveraged lower valuations to shell out hundreds of millions of dollars on office properties across the United States over the past year.
Buyers drove a 20% spike in the national office sales volume throughout 2025 compared to the prior year, preliminary CoStar data shows.
The discounted deal provides "a strong foundation for value creation, with meaningful upside through the strategic enhancement of the campus," Elena Miller, DivcoWest's head of Bay Area and Pacific Northwest acquisitions, said in a statement.
"The fundamentals underpinning high-quality R&D projects across Silicon Valley, particularly given the surge of tenant demand in the back half of 2025 amidst a lack of premium R&D supply," she added.
The office park comprises almost 253,000 square feet of mostly leased office space that's within walking distance of public transit and shops. The buildings, constructed in 1982, have undergone renovation in recent years and now feature overhauled floor plates and a state-of-the-art power system, in addition to amenities such as fire pits, a bocce ball court and a shaded arbor.
About 46,000 square feet is available for lease, according to marketing materials from CBRE. Current tenants include Verizon, autonomous driving company AutoX Technologies and automotive technology company Cepton.
Ups and downs
The office market in San Jose, the largest city in the Bay Area tech region, showed signs of a rebound in 2025 as mounting tenant interest led to a surge in leasing, reflecting the impact of the artificial intelligence boom on the regional real estate market.
By the end of last year, San Jose's office market posted its strongest two consecutive leasing quarters since 2022, a boost largely fueled by increasing demand among AI companies, according to CoStar's latest report.
Nevertheless, a series of tenant contractions over the past year has weighed down the tech hub's rebound, pushing the area's vacancy rate beyond 15% as some major tech firms cut back on staff and office space, focusing more resources on the development of AI.
That has complicated the financial outlook among some landlords in the region, meaning they've been eager to get troubled properties off their books — even if they come at a heavily discounted price.
It's a phenomenon that has rippled across the country, providing a window for firms such as DivcoWest to leverage declining valuations ahead of what they expect to be an imminent pricing rebound.
Late last year, DivcoWest closed on a $125 million deal with Perform Properties, an affiliate of global asset manager Blackstone, for a building in Boston's affluent Back Bay area. The company plans to renovate the property and reposition it in line with the city's strengthening recovery.
And a few weeks later, the firm finalized a $31 million deal for a property in Silicon Valley's Redwood City, about midway between San Francisco.
DivcoWest has bet heavily on the long-term effects of San Francisco's AI boom, an investment that has extended beyond office buildings to other real estate classes. Last September, it joined JB Housing Ventures on a $43.3 million deal to buy a 137-apartment complex called The Vance in San Francisco's Western Addition neighborhood.
Also last year, DivcoWest and investor Blackstone Real Estate joined forces to purchase 300 Howard St. in the city's South of Market Street neighborhood, with plans to attract artificial intelligence tenants and market the stretch as "AI Alley." Planned renovations aim to reimagine the early 2000s-era office tower as a "high performance hub built for today's most ambitious teams," DivcoWest said in a release at the time of the deal.
In 2024, it leased out the entire building at 550 Terry A. Francois Blvd. in the city's Mission Bay neighborhood to OpenAI, the maker of ChatGPT. It also paid more than $222 million through a joint venture with Norges Bank Investment Management, the investment arm of Norway's central bank, to acquire Sand Hill Commons, a two-building office campus in Silicon Valley surrounded by the headquarters of some of the world's largest tech companies.