Thursday, November 16, 2006

Rambus Inc. a valuable tenant

Behringer Harvard, a Dallas-based commercial real estate company, announced 11/15/06 that it had acquired the digs occupied by Rambus Inc.

Rambus' 2001 annual report notes that the facilities are leased under an operating agreement that runs through December 2010. Rambus Inc. is responsible for taxes, insurance, utilities and maintenance related to the leased facilities. The lease has an initial term of ten years with options to renew for an additional ten years, subject to certain conditions. Annual rent for 2007 is approximately $4.6 million.

The purchase price, reported to be $44 million pencils in at about $455.00 a square leaseable foot of space. The property consists of 1.6 acres, with 96,562 square feet of leaseable space, a two-story underground parking garage with 350 spaces and additional surface parking.

The Mercury New reports:

"They liked the safety of having Rambus in there through 2010 and they realize how difficult it is to build in Palo Alto or Los Altos -- the potential to build in that sub-market is pretty limited,'' Doyle said.

According to LoopNet, which tracks commercial real estate investment markets across the country, the average price for office buildings sold in San Jose during the third quarter was $242 per square foot. A couple of sales went higher: Orchard Parkway in San Jose sold to Divco West Properties for $516 a square foot; and 303 Bryant St. in Mountain View sold to Sarofim Realty Advisors for $646 a square foot.
Any Donkey wonders if Rambus Inc. wasn't in the throes of spending tens of millions investigating its misdated options and restating its financial if Rambus Inc. would have been in the market to purchase its corporate headquarters?

I heard it once . . . "It's only money . . ."

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