South Bay sale resets office comps

A North San Jose tech building at 2581 Junction Ave has become a new price marker for South Bay offices after a discounted sale and a fresh marketing push. (loopnet.com) The property totals 92,864 square feet on 5.385 acres and includes 22,240 square feet of cleanroom space, a 645-kilowatt generator, redundant Pacific Gas and Electric power, and 306 parking spaces. It last sold for $32 million on Nov. 15, 2018, according to property records. (loopnet.com) (propertyshark.com) The Kase Group is marketing the building at $33 million, or about $355 per square foot, and the listing says the current lease runs through October 2028 with no renewal options. The marketing also pitches the site as an owner-user or advanced-manufacturing play rather than a conventional office investment. (loopnet.com) (showcase.com) That matters in North San Jose because this is not generic cubicle space. It is a lab and research-and-development building with expensive power, cleanroom, and life-safety systems that usually narrow the buyer pool but can hold appeal for chip, battery, and other hardware users. (loopnet.com) (crexi.com) The tenant, Ensurge Micropower, has described 2581 Junction Ave as its principal office, engineering lab, and cleanroom factory in San Jose. In its fourth-quarter 2025 report, the company said it makes ultra-thin solid-state lithium microbatteries for medical devices, hearables, wearables, industrial systems, and defense. (otcmarkets.com) (assets.milestoneinternet.com) Another recent deal gives brokers a second comp in the same broad South Bay market. El Camino Health bought a Sunnyvale office building for $19.3 million in early April after its board scheduled a March 18, 2026 discussion of a property acquisition tied to assessor parcel number 205-23-017. (therealdeal.com) (elcaminohealth.org) The Real Deal reported that El Camino’s Sunnyvale purchase followed a $13.2 million Milpitas office buy two months earlier and a $22 million Mountain View office purchase in October 2025. Those deals show owner-users and healthcare operators are still buying selectively even as traditional office values reset. (therealdeal.com) Market reports show why pricing has split. Cushman & Wakefield said on April 6 that the U.S. office market posted negative 4 million square feet of absorption in the first quarter, while Colliers said Silicon Valley industrial demand stayed strongest in modern, high-power buildings and San Jose vacancy fell to 6.1% quarter over quarter. (cushmanwakefield.com) (colliers.com) That leaves 2581 Junction in an in-between category that is suddenly useful for comps: older than the newest industrial product, but far more specialized than a standard office building. As owners, tenants, and lenders test new values in 2026, each sale like this gives the South Bay one more hard number to price against. (colliers.com) (propertyshark.com)