A cybersecurity company has acquired a nearly 15-acre site in Santa Clara previously entitled for office development. BXP sold the vacant property at 3625 Peterson Way to an affiliate of Palo Alto Networks in an all-cash transaction valued at $90 million, according to the Silicon Valley Business Journal. BXP originally purchased the land in 2016 for $78 million. The property’s assessed value earlier this year was reported as $89.1 million by the Mercury News.
The site once housed a 218,366-square-foot office building, which has been demolished. A BXP affiliate had submitted plans to construct close to 700,000 square feet of office space and parking facilities on the property. This proposal included two eight-story office buildings connected by bridges and a four-level parking garage, with each building totaling over 338,000 square feet.
The city approved architectural permits for the project in 2022 and granted a permit extension this year. However, BXP noted that market conditions could make the project infeasible and stated that “the timeline for Silicon Valley Power to provide sufficient power to the site ‘exceeds a reasonable timeline to develop the site and attract tenants.'”
In July, SummerHill Homes filed a preliminary application with Santa Clara officials to build 292 townhome-style condominiums on the property. The city is required by state mandate to plan for more than 11,600 new housing units by 2031.
Palo Alto Networks’ headquarters are adjacent to the newly acquired parcel. The company has not disclosed its specific plans for the location but may consider either commercial or residential development options moving forward. If developed as offices per BXP’s original blueprint, the site could accommodate between 2,700 and 3,400 workers.
