Republic Family of Companies | 5300-5350 Hellyer
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We Create Landmarks

5300-5350 Hellyer

San Jose, CA
OVERVIEW LOCATION

5300-5350 Hellyer
San Jose, CA 95138


PROPERTY HIGHLIGHTS
• Class “A” product with excellent access to Highways 101 and 82, as well as the Lightrail and Caltrain lines.
• Significant infrastructure invested by the tenant including 21 KV of power and over 1,000 tons of HVAC.
• Built in 2001, the Property is of newer construction and features prominent signage along Hellyer Avenue.
• Excellent parking at a ratio of 3.1 spaces per 1,000 square feet.

TENANCY HIGHLIGHTS
• 100% leased to Cobham Electronic Systems with an approximate 8 years of remaining term.
• Cobham is an industry leading developer and high-volume manufacturer of RF, microwave, and millimeter wave products and technologies.
Holding hundreds of patents in the field, they have become known as expert technology innovators and integrators. More specifically, they design and manufacture active microwave components, assemblies and subsystems for military aircraft, ground vehicles, missiles, space launch vehicles, satellites and commercial avionics.
• The tenant is a wholly-owned subsidiary of Cobham, plc, a FSTE 250 Company (LON:COB) headquartered in the United Kingdom with approximately 10,090 employees.
• Cobham has a history of strong profits and positive cash flow. The company has averaged a 12% profit margin over the past 10 years, with £231m ($361m) of profit in 2013.
• The Company has paid down £58m of debt since the beginning of 2014 while increasing its cash reserves by £238m (40% increase) through a secondary equity offering. This shows Cobham’s capacity to manage financial leverage through debt extinguishment as well as an ability to raise additional capital when necessary.

INVESTMENT HIGHLIGHTS
• Cobham Electronic Systems, who has been in occupancy at the Property since it was delivered, has made significant contributions towards their improvements. Cobham signed a lease extension in mid-2012 for an additional ten years, demonstrating their long-term commitment to this property.
• The lease is NNN with annual fixed escalations, providing a predictable and secure income stream.
• Given the recent market movement and projected market rent growth, in-place rents are poised to be well below market rents upon the lease expiration.
• The Property will be delivered free and clear of existing financing allowing an investor to capitalize the transaction in the most efficient manner.

MARKET HIGHLIGHTS
• As a hub for many technology firms, the Silicon Valley R&D market continues to demonstrate positive fundamentals, marked by an 870 basis point decrease in vacancy and a 54% increasing in average asking rates since the end of 2010.
• Due to the Silicon Valley’s growth in the late 1990s, much of South San Jose market’s R&D base is less than 15 years old. The area is established as one of the most affordable in the Silicon Valley with master-planned business parks, newer buildings and immediate access to residential areas in the growing south county area.
• CBRE Econometrics projects strong continued growth over the next five years with rents forecast to grow 45% in South San Jose and 41% in Silicon Valley over that time period.