Intuitive Surgical has bought some old research and office buildings in Sunnyvale, a deal that took place in area where the company has been busy lately attempting to expand its footprint.
The maker of advanced medical devices and equipment purchased three low-slung buildings on Commercial Street on sites that are a short distance from the company’s headquarters in Sunnyvale.
Intuitive Surgical paid $15.1 million for the buildings, which are located at 164 Commercial St. through 174 Commercial St. in Sunnyvale and are on the south side of Central Expressway, according to Santa Clara County property records that were filed on April 30.
The seller in the all-cash deal was an affiliate of the Rice Family, the public documents show.
“This is an excellent redevelopment opportunity,” according to a brochure from commercial real estate firm Newmark Knight Frank, which was marketing the property for sale.
The property currently contains three buildings that together total 36,000 square feet.
But the real value in the deal might reside in the four acres of land beneath the one-story buildings, which range in size from 10,000 square feet to 16,000 square feet.
That’s because the zoning for the property could allow a building as large as 119,000 square feet to 170,000 square feet, using a complex formula based on floor-area-ratios.
“The possibility of increased density provides the value enhancement for this property,” Newmark Knight Frank brokers David O’Such and John McKenna wrote in their marketing brochure.
Sunnyvale-based Intuitive Surgical has been finding potential expansion sites near its head offices through leases of office buildings, or purchases of properties where existing buildings could be bulldozed and replaced with modern offices.
In February, Intuitive Surgical leased two big buildings in Santa Clara at 3410 and 3420 Central Expressway that together total 210,000 square feet.
In March, the company paid $30.4 million in cash for a 47,000-square-foot building at 818 Kifer Road, just east of Wolfe Road.
Over the 12 months that ended in March, Intuitive Surgical earned $1.15 billion on $3.85 in revenue. The company, a leader in surgical robotics, is best known for its da Vinci Surgical System, which melds software, hardware, and optics to enable doctors to perform surgeries aided by robots from a remote console.
All of these transactions, the two property purchases and the leasing deal, are not only in close proximity to the company headquarters at 1020 Kifer Road in Sunnyvale, but also are near a busy train station.
“The property is immediately contiguous to the Lawrence Station planning area established by the city of Sunnyvale to guide future development of the area surrounding the Lawrence Station to created increased Caltrain ridership,” the Newmark Knight Frank brochure stated.
Source: San Jose Mercury News, May 1, 2019