SAN JOSE — A tech company has bought a San Jose site from another tech firm in a deal that reinforces that a post-coronavirus pandemic malaise still afflicts parts of the Bay Area’s office market.
The office building, located at 2201 Qume Drive, was bought by ISE Labs for $24 million, according to documents filed on Sept. 6 with the Santa Clara County Recorder’s Office. The ultimate purchase price is 18.6% below what the seller had originally been seeking less than a year ago.
IPG Photonics, a maker of optical fiber lasers, sold the office site to ISE Labs, a technology services firm that has an operation in Fremont.
It wasn’t immediately clear whether ISE Labs would keep the Fremont office and expand at the San Jose site or shift its Fremont operations to San Jose.
ISE Labs bought the office building through an all-cash deal, the county documents show.
The just-bought office building totals slightly under 64,000 square feet, according to a marketing brochure being circulated by real estate firm TRI Commercial, whose brokers Martin Morici and Joshua Gispan were marketing the building for sale at the time of the purchase.
Although IPG Photonics had owned the building for some years, the site was vacant at the time ISE Labs bought the property, according to commercial property listing services.
The TRI Commercial property flyer indicated the seller cut the asking price at least once during the period of the marketing efforts, which began sometime around December 2022, according to a previous report in The Registry.
The original asking price was $29.5 million. Subsequently, IPG Photonics cut its target value for the property to $26.5 million.
The reduced pricing is a fresh example of ongoing weakness for many office sites in the Bay Area.
An uneven return to work in the wake of government-ordered business shutdowns to combat the coronavirus, combined with tech industry layoffs and skyrocketing vacancy rates for offices in many cities, have hobbled numerous segments of the Bay Area’s office sector.