By Janice Bitters, Silicon Valley Business Journal
Cisco Systems is letting go of more than 471,000 square feet of leased office space split between three buildings in Milpitas as it spends millions of dollars on its San Jose headquarters.
The decision to shed the space by the end of the year has prompted landlord Hudson Pacific Properties to embark on a major overhaul of the property, known as Campus Center, at 115-155 N. McCarthy Blvd. near McCarthy Ranch.
According to Cisco, the Milpitas departure is a move toward consolidating its Silicon Valley presence and beefing up its San Jose headquarters.
“Our San Jose master plan includes investing in improvements and densifying our main headquarters campus by using Cisco technology and creating collaborative work environments to enhance innovation and productivity”
“In alignment with that plan, the Milpitas McCarthy Ranch lease is no longer required for continued business operations.”
City of San Jose building permits show the network systems giant is pumping millions into its corporate San Jose offices.
Cisco’s departure in Milpitas comes earlier than initially planned. The company signed a 12-year lease for the property in 2007, when it was owned by New York City-based Blackstone Group.
As part of its early termination agreement, Cisco has paid $10.4 million to Hudson Pacific, the real estate company said late last week in a press release. New York City-based Hudson Pacific also plans to write off nearly $6 million in non-cash items, including market rent lease adjustments associated with Cisco’s early departure.
Cushman & Wakefield is marketing the Milipitas property.
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Janice Bitters primarily covers commercial real estate for the Silicon Valley Business Journal. Other topics she follows include residential real estate and economic development.