Super Micro Computer Buys More San Jose Offices

San Jose-based photonics company Lumentum is offloading office space after announcing a major partnership with Silicon Valley giant Nvidia.

Super Micro Computer purchased two office buildings from Lumentum for $43 million, the Silicon Valley Business Journal reported.

The structures span 116,000 square feet at 1733 and 1745 Fox Drive are near other buildings separately owned by Super Micro and Lumentum. Super Micro’s corporate headquarters is less than a mile from the Fox Drive buildings, at 980 Rock Avenue.

The price amounts to $371 per square foot.

It’s the latest purchase in the neighborhood for Super Micro. Last September, the information technology company bought a 35,000-square-foot office building at 1321 Ridder Park Drive for roughly $13.3 million, the Business Journal reported. That transaction amounted to $380 per square foot.

Super Micro Computer is “rapidly scaling domestic production of advanced AI infrastructure,” CEO Charles Liang said in a statement.

The move comes as AI-driven tech firms are gobbling up office space in Silicon Valley and around the Bay Area. As demand for offices increases, the lack of construction has led tenants to compete for space. Office vacancy in the wider Silicon Valley market dropped to 15.8 percent in the fourth quarter, according to Colliers.

The office vacancy rate in North San Jose, where the buildings are located, is 16 percent, according to Cushman & Wakefield.

Lumentum bought the two 1980s-built office buildings in 2019. One spans 65,000 square feet, and the other spans 51,000 square feet. Lumentum used the space there for offices, research and development and manufacturing support.

On Monday, Nvidia announced plans to invest $2 billion in Lumentum in a partnership aimed at accelerating AI growth, enabling Lumentum to scale its manufacturing capacity and R&D to meet the needs of future AI data centers.

— Chris Malone Méndez