California State Teachers Retirement System (CalSTRS) is understood to have acquired a Silicon Valley office building for $162.5m (€145m).
The $207bn pension fund bought the six-storey, 250,000sqft building in Santa Clara, California, through its separate account manager CBRE Global Investors, according to sources.
CalSTRS and CBRE Global Investors did not comment.
The office building, occupied entirely by Hewlett Packard Enterprises on a 11-year lease, is part of a multi-phase campus office complex located at 3333 Scott Blvd.
It will be placed in the pension fund’s core real estate portfolio. IPE Real Estate reported last week that CalSTRS was planning to widen the parameters of the portfolio.
The building is being sold by Beacon Capital Partners and local developer Menlo Equities.
The two joint venture partners acquired 30.2 acres of land for the campus development in 2011.
They recently put up for the sale the other part of the development, which includes three eight-storey office buildings that total 940,000sqft.
All of the space is leased to Palo Alto Networks for the next 11 years.
The cap rate on the sale to CalSTRS is understood to be between 5.5% and 5.6%.
The pricing on the part of the campus complex is projected to match or exceed the $650 per sqft pricing that was achieved on the Hewlett Packard building.