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S I L I C O N V A L L E Y , C A L I F O R N I A
F OXC ONN Technolog y C en t er58,289 SF OFFICE/R&D BUILDING | INVESTMENT GRADE TENANT | SINGLE TENANT NNN LEASE TO FOXCONN FOR 7.5 YEARS
EXECUTIVE SUMMARY
PROPERTY SUMMARYAddress 408 East Plumeria Dr., San Jose, CA 95134
Building Area 58,289 Square Feet
Stories One
% Leased 100%
Parking 3.55 / 1,000 Square Feet
Site Area 3.91 Acres
OCCUPANCY SUMMARY% Leased 100%
TenantFoxconn Interconnect
Technology Limited
Parent Company
Hon Hai Precision
Industry Co., LTD. (dba
Foxconn Technology Group)
Parent Company
Credit RatingA- (Standard & Poor’s)
Market Cap $65 Billion (as of 11/2/17)
Ticker Symbol
Taiwan: 2354
London: HHPD
Hong Kong: 2038
Lease Expiration August 31, 2025
Remaining Lease Term(as of 2/1/18 analysis start date)
7.5 Years
Current Monthly Rent$2.30 NNN with 3% annual
increases
THE OFFERINGCushman & Wakefield, as exclusive advisor, is pleased to present
the unique opportunity to acquire the 100% fee simple interest
in Foxconn Technology Center (the “Property”), a 58,289 square
foot office/R&D asset advantageously located at the southwest
corner of Montague Expressway and East Plumeria Drive in
Silicon Valley’s coveted Golden Triangle, along the North First
Street Corridor in San Jose, CA.
The extensively renovated Property is 100% leased on a fully
NNN basis to Foxconn Interconnect Technology, a wholly owned
subsidiary of Foxconn Technology Group (“Foxconn”). The initial
lease term is seven-and-a-half years with a lease expiration of
August 2025, and 3% annual increases. Foxconn is the world’s
largest manufacturer of consumer electronics with an impressive
client list comprised of some of the largest tech companies in
the world including Apple, Google, Microsoft, HP, Sony, and
Toshiba. The company generated $80.1 billion in revenue in
2016 and is rated A- by Standard & Poor’s. The building has
undergone an impressive upgrade and modernization with tenant
improvements underway, totaling approximately $7.5 million in
capital investment by current ownership.
This offering provides investors the exceptional opportunity to acquire a high-image, well located, top quality asset with
Investment Grade Tenancy, a fully triple net lease, and immediate cash flow in one of Silicon Valley’s most vibrant submarkets.
FOXCONN Technology Center
1
INVESTMENT H IGHL IGHTSIMMEDIATE CASH FLOWThe Property is 100% leased to Foxconn on a triple net basis through August 2025, providing secure income from an investment
grade tenant. The lease provides for 3% annual increases in the tenant’s base rent which enables the owner to receive an increase
in cash flow during the lease term. The triple net structure of the lease makes the tenant responsible for the cost of all building
operating expenses.
World’s
Largest
Electronics
Manufacturer
5th Largest
Employer
Worldwide
$65B
Market Cap
ESTABLISHED, INVESTMENT GRADE TENANTFounded in 1974, Foxconn is the world's largest contract
electronics manufacturer and the fourth-largest information
technology company in the world by revenue. The
company is the largest private employer in China and
the 5th largest worldwide with 727,000 employees
and 13 factories in 10 countries. Traded on three stock
exchanges—Taiwan, London and Hong Kong—Foxconn
has a market capitalization of $65 Billion as of 11/2/17.
Foxconn maintains an A- rating from Standard & Poor’s.
EXECUTIVE SUMM
ARY
2
STRONG LONG-TERM TENANT OUTLOOKFoxconn is a global leader in the production of consumer electronics
such as smartphones, tablets, laptop computers, and high definition
televisions. Their global consumer electronics market revenue is
estimated to be $271B in 2017, and is forecast to show an annual
growth rate of 9.6% resulting in a market volume of $428B in 2022.
As a leader in the production of personal electronics, Foxconn is
expected to continue its impressive growth.
236,307 271,080
307,484 342,987
375,596 404,037
427,781
0
100,000
200,000
300,000
400,000
500,000
2016 2017 2018 2019 2020 2021 2022
Worldwide Consumer Electronics Revenue Forecast(in million US $)
Source: Statista, October 2017
Market Ready Tenant Improvements
FOXCONN Technology Center
3
TOP TIER ASSET WITH SIGNIFICANT CAPITAL INVESTED BY CURRENT OWNERSHIPCurrent ownership has made approximately $3.0 million of capital in improvements to significantly upgrade the Property as one of the
leading assets in the marketplace. Capital improvements include extensive lobby and facade upgrades, fresh Title 24 compliant office
interiors, new restroom cores, new roof with a 20 year warranty, new rooftop mechanical units, new landscape and hardscape, and
parking lot resurfacing and striping. In addition to the capital invested in base building improvements, current ownership has invested
$4.5 million in tenant improvements currently underway. The result of the total investment into the Property is a modernized asset with
no need for further capital investment for many years to come.
JUNCTION AVENUE
MONTAGUE EXPRESSWAY
E PLUM
ERIA D
RIVE
New Outdoor Patio
New Roof & Rooftop Mechanical Units
Lobby & Facade Upgrades
$4.5 Million in TIs
Parking Lot Resurfacing & StripingP
New Landscape & Hardscape
High Identity Signage
N
Approximate Property Boundary
4
EXECUTIVE SUMM
ARY
TREMENDOUS VISIBILITY AND IDENTITYThe Property is located along Montague Expressway, a highly trafficked
thoroughfare that links the West Valley, Santa Clara, and North San
Jose and serves as a link between Highway 101 and Interstate 880.
The Property enjoys nearly 500 linear feet of frontage along Montague
Expressway with monument and building signage at the northwest
corner of the Property. The Property sits at the signalized intersection
of Montague Expressway and East Plumeria Drive.
PRESTIGIOUS SILICON VALLEY LOCATIONSan Jose’s North First Street Corridor has long been known as one of
the most desirable trade areas in Silicon Valley. Some of the world’s
most notable technology companies such as Apple, Google, Samsung,
PayPal, Cisco, Broadcom, Philips, Qualcomm and Dell maintain a
significant presence in the immediate area adding to the submarket’s
reputation as a hotbed for Silicon Valley’s Blue Chip technology tenants.
SAN JOSE GROWTHThe City of San Jose is a landing spot for some of the region’s largest technology companies looking to grow or relocate out of
smaller submarkets such as Mountain View, Sunnyvale and Cupertino. In 2011, the city adopted the “Envision 2040 General Plan”
with the goal of producing 470,000 new jobs in the city by 2035. The North First Street Corridor has been slated to accommodate
a significant portion of this growth.
In June of 2017, the city of San Jose approved plans to engage in discussions with Google to develop a colossal new transit-
oriented campus in the heart of downtown San Jose. The six to eight million square foot development is expected to bring up
to 20,000 new jobs into San Jose. Apple has assembled 86-acres along the North First Street corridor to accommodate a 4.15
million square foot office/R&D campus. The new campus, which is rumored to be the location for the development of Apple’s
autonomous vehicle technology, could also bring another 20,000 jobs to the city.
Broadcom San Jose
Google’s Downtown San Jose Proposed Development
FOXCONN Technology Center
5
PROXIMITY TO RETAIL AND RESIDENTIALThe Property is located amidst extensive retail and residential offerings that are attractive offerings for employees. Walkable retail
amenities can be found just across Montague Expressway at River Oaks Village which is home to multiple restaurants and Starbucks.
Major retail centers within two miles of the Property can be accessed at RiverMark Center in Santa Clara, @First in North San Jose,
and McCarthy Ranch in Milpitas. Over the past five years, approximately 8,000 new multi-family units have been delivered in North
San Jose. Many of these new developments have added ground floor retail services. Projects of particular note built within one mile
of the Property include Crescent Village and Mirada by The Irvine Company at the corner of Research Place and Innovation Drive.
Under the Envision 2040 General Plan, the City of San Jose intends to add 32,000 housing units in North San Jose.
Montague ExpresswayN First Street
@First Shopping Center10 Minute Drive
Rivermark Shopping Center5 Minute Drive
Mirada
Cresent Village
Related Companies’ City Center$6.5 billion mixed use development
River Oaks Village5 Minute Walk
N
FOXCONN Technolog y Cen ter2.7 miles
Coyote Creek Tra
il
6
EXECUTIVE SUMM
ARY
SUPERIOR TRANSPORTATION & TRANSIT ACCESSThe Property’s central Silicon Valley location is ideally positioned
to draw from the regional labor pool concentrated to the east
and south, while at the same time accommodating high-income
executives who live in the West Valley and along the Peninsula.
HIGHWAY Via Montague Expressway, the Property is within
a few minutes’ drive from Highway 101 and
Interstate 880, two of the Bay Area’s primary north
and south transportation arterials. This handy
access and direct connections to I-280, I-680, SR-
237, SR-87, and SR-85, provide commuters with
convenient routes throughout the valley and to
the San Francisco Peninsula or greater East Bay.
LIGHT RAIL Santa Clara Valley Transportation Authority (VTA)
provides light rail service from Mountain View
through San Jose with trains that link to Caltrain,
Bay Area Rapid Transit (BART) and Mineta San Jose
International Airport. The Orchard VTA station is
just a short walk from the Property.
AIRPORT Mineta San Jose International Airport is located
approximately four miles from the Property.
Mineta Airport serves more than nine million
passengers per year and provides business
travelers convenient and frequent access to more
than 260 international and domestic flights daily.
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SANTA CLARACOUNTY
VTALIGHTRAIL
ALTAMONTECOMMUTEREXPRESS
WARM SPRINGS/SOUTH FREMONT
MILPITAS(Opens 2017)
Bay Area Transportation RoutesBART Lines
Dublin/Pleasanton-SFO/MillbraeFremont-Daly CityRichmond-FremontRichmond-Daly CityPittsburg/Bay Point-Daly City
VTA Light RailMountain View-WinchesterAlum Rock-Santa TeresaAlmaden Shuttle
BART to Milpitas
CalTrain
Amtrak Capitol Corridor & Altamonte ExpressSF Muni
BART to Oakland Airport
Under Construction
F OXC ONN Technolog y C en t er
FOXCONN Technology Center
7
SILICON VALLEY OFFICE/R&D MARKET HIGHLIGHTSWith a high concentration of revolutionary
technology companies and an unparalleled
stream of venture capital investment,
Silicon Valley is renowned as the world’s
center of technology. As one of the
Bay Area’s key economic drivers, the
region’s technology sector flourishes
from immediate access to one of the most
educated workforces in the nation. Over
the past five years, growth from some of
the region’s most prominent employers
such as Apple, Google, Samsung, Netflix
and LinkedIn has made the Silicon Valley
one of the nation’s top performing office/
R&D markets. Since 2011, the market has
absorbed more than 11.0 million square feet
of office/R&D space. Over the same period,
asking rents have grown an average of
16.3% per year, significantly outpacing
most major markets in the country.
10.2%VACANCY
$2.15AVG. ASKING RATE
3.8 MSFYTD NET
ABSORPTION
SILICON VALLEY OFFICE/R&D Q3 ‘17 MARKET STATS
Source: Cushman & Wakefield Research
8
EXECUTIVE SUMM
ARY
ERIC FOXLic: 01209035
ADAM LASOFFLic: 01891096
STEVE HERMANNLic: 01352679
SETH SIEGELLic: 01493953
INVESTMENT CONTACTS
STEVE PACELic: 00817396
LOCAL MARKET ADVISORY
DAN HOLLINGSWORTHLic: 01117716
NICK LAZZARINILic: 01788935
F OXC ONN Technolog y C en t er
DOUG LONGYEARLic: 00829911
NNN ADVISORY
ANDY BOGARDUSLic: 00913825
CHRIS SHELDONLic: 01806345
Broker and Owner make no warranty or representation, express or implied, to the accuracy of the information contained herein. The information has been submitted in good faith subject to the possibility of errors and omissions; change of price, rental information or other related Property information; or, withdrawal without notice. Purchasers should rely solely on their own independent analysis, due diligence and verification of Property information. Prospective Investors agree that Broker and the Owner shall have no liability to the purchaser or purchaser’s representatives or agents resulting from the use of the information contained herein or distributed by Broker and the Owner in the future.
