Texas Instruments Leases Office Buildings in Santa Clara

Dallas-based semiconductor manufacturer Texas Instruments is expanding its Silicon Valley presence with a 205,000-square-foot lease of office space near Great America in Santa Clara.

Texas Instruments completed the rental transaction at 4555 Great America Parkway in the first quarter of this year, The Silicon Valley Business Journal reported. The leased office space could accommodate between 700 and 1,000 employees. The lease is for a two-building complex adjacent to Great America and is the second-largest office transaction in the region this year after Tesla’s 320,000-square-foot lease in Palo Alto.

The semiconductor manufacturer already operates out of Santa Clara at 2900 Semiconductor Drive, a manufacturing facility that used to be home to National Semiconductor before Texas Instruments purchased that company in 2011 for $6.5 billion.

The office vacancy rate for Santa Clara in the first quarter was the highest in the region at 19 percent, according to Colliers data. Santa Clara also had the highest office availability rate, or spaces that were available for lease whether or not they are physically occupied, in Silicon Valley in the quarter at 29 percent.

The vacancy rate for Silicon Valley as a whole stood at 10.7 percent. Historically, levels hovering above 10.0 percent have not been seen since 2014, when vacancy measured 10.2 percent in the second quarter.

While leasing activity remained healthy in the first quarter, with non-renewal leases and user-sale transactions totaling over 1.3 million square feet, gross absorption decreased 47.6 percent year over year, signaling a slowdown in the market.

Office sales remained stagnant in Silicon Valley as well. Sales volume decreased 71 percent year over year totaling $106.4 million across eight properties, according to the Colliers report.

“Given that many companies have adopted hybrid work schedules, tenants have assessed their space requirements, taking into account not only size but also amenities and features that would motivate employees to return to the office,” the Colliers report said.

— Pawan Naidu