Apple to Spend $365 Million for Kilroy-Owned Offices

Apple is taking another bite out of the South Bay with its third recent office deal in the area.

The trillion-dollar company, headquartered in Cupertino, is in contract to buy Kilroy Realty’s four-building Mathilda Campus in Sunnyvale, the San Francisco Chronicle reported. The tech giant has purportedly agreed to buy 505-599 North Mathilda Avenue and 605 West Maude Avenue for $365 million.

The purchase would bring the buildings that Apple currently leases under the company’s ownership. It leases 581,429 square feet of the 663,000-square-foot complex. The deal, expected to close later in the third quarter, works out to $550 per square foot.

Apple has been on a tear in the South Bay in recent months, dropping nearly $1 billion on office properties in three separate transactions.

Last month, the company spent $350 million for 615 and 625 North Mathilda Avenue in Sunnyvale, next door to the latest buildings purchased. That same week, it paid $166.9 million for the three-building, 220,000-square-foot Cupertino Gateway complex at 10200 North Tantau Avenue next to its Cupertino headquarters. Like three of the four buildings at the Mathilda Campus, Apple was leasing those buildings.

The San Jose metro area had a 51.5 percent return-to-office rate as of July 16, close to a post-pandemic record, according to data provided to the Chronicle by security firm Kastle. Apple has seemingly been doubling down on in-person work in recent years with its continued investments in office properties in the area.

In early 2023, Apple bought a 10-building campus known as Apple Results Way from Swift Realty Partners for an undisclosed price. It had been leasing the property since 2011. Later that year, Apple spent $70 million on an office building at 10200 North De Anza Boulevard.

The De Anza property is down the street from a five-building complex that Apple bought in 2021 for $450 million. It nabbed 10500 North De Anza Boulevard; 20400 Mariana Avenue; and 20605, 20665 and 20705 Valley Green Drive from affiliates controlled by developer Carl Berg.

At the end of the second quarter, Sunnyvale had an office vacancy rate of 18 percent, below Silicon Valley’s overall rate of 20.7 percent, per Cushman & Wakefield data cited by the Chronicle. — Chris Malone Méndez