The six-story office tower at 400 Castro Street in downtown Mountain View has changed hands for $121.5 million, with law firm Fenwick & West still occupying every square foot more than two decades after the building went up. Real estate giant Tishman Speyer sold the fully-leased, 138,681-square-foot property to San Francisco-based Spear Street Capital, a deal that works out to roughly $876 per square foot in one of Silicon Valley’s tightest downtown office corridors.
Tishman Speyer, based in New York, developed the LEED Platinum-certified building in 2002 and has held onto Fenwick & West as its anchor tenant ever since, according to The Real Deal. The building’s 100 percent occupancy at the time of sale, paired with 543 parking spaces, made it an attractive target even as commercial real estate elsewhere has cooled. Ground-floor retail tenants Cascal restaurant, Peet’s Coffee and Sweetgreen round out the property, per CommercialSearch.
Eastdil Secured represented Tishman Speyer in the transaction, with the firm’s Nate Jones leading the team, the article notes. Maggie Kadin, whose role in the deal was cited in the reporting, said the closing reflected continued demand for well-located, institutional-quality office assets — a read that lines up with the broader numbers coming out of the region this year.
A Long Hold Pays Off
The sale caps a lucrative run for Tishman Speyer, which recapitalized the property back in 2012. Since that recapitalization, the seller achieved a 17.4 percent gross internal rate of return, equal to a 1.9x equity multiple, and a net internal rate of return between 15.8 and 17.0 percent, according to RENtv. That 14-year holding period underscores just how durable a fully-leased, transit-adjacent Class A asset can be in downtown Mountain View, even through multiple economic cycles…