SAN JOSE — A tech company that’s in expansion mode has officially bought a San Jose site that once was the location of a Mayan-themed Fry’s Electronics store but now could become a huge office campus.
The just-bought property in north San Jose could serve as the latest jobs hub for the site’s new owner, Super Micro Computer.
Super Micro Computer paid $80 million for the property at 550 East Brokaw Road, according to documents filed on Feb. 9 with the Santa Clara County Recorder’s Office.
San Jose-based Super Micro bought the 19.7-acre property near the interchange of Interstate 880 and Brokaw Road through an all-cash deal, the county documents show.
The company now owns a choice site where San Jose city officials have approved a vast seven-building office campus. The city approvals envision a phased development of the tech campus.
Super Micro Computer is well aware of the property’s potential for development, according to a company regulatory filing with the Securities and Exchange Commission.
“The seller previously obtained, and the company is acquiring under the purchase agreement, discretionary entitlements for a potential redevelopment of the property,” Super Micro Computer stated in the SEC documents.
Campbell-based Bay West Development, acting through affiliate Caracol Property Owner, sold the property to Super Micro. Bay West had previously obtained entitlements for the development of the site.
Over the last two years, despite the city’s approval, the development of a speculative office campus in the Bay Area has become unviable.
That’s because some severe post-coronavirus economic maladies have afflicted the Bay Area office market.
Chief among the ailments: Numerous tech companies have drastically curbed their respective appetites for office space at a time when they have engineered wide-ranging job cuts.
However, an office campus that is bought by a potential user such as a tech company can suddenly become viable.
Super Micro Computer is in expansion mode and appears to be steering against the tide of tech industry cutbacks and retrenchments in the Bay Area.
In 2013, the tech company bought the former headquarters campus of the San Jose Mercury News, which is now located in downtown San Jose. In 2018, the tech company bulldozed the newspaper’s former newsroom building.
Super Micro then embarked on a redevelopment of the one-time newspaper property, located on Ridder Park Drive near Brokaw Road. The redevelopment includes some new office and research buildings. The Ridder Park site is known as the company’s green computing campus.
At the just-bought East Brokaw site, the approved project allows for the phased construction of seven office buildings totaling about 1.92 million square feet and two parking structures totaling roughly 1.65 million square feet.
The project would bring about the demolition of the former Fry’s store, office and warehouse structures on the property. The existing space totals 293,900 square feet, according to the purchase documents. Super Micro happens to be leasing a warehouse on that site.
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Fry’s Electronics store operations ended about three years ago in February 2021 when the iconic retailer abruptly went out of business because it was unable to survive in an economy dominated by the relentless expansion of online commerce, frequently for purchases of computers and other electronic products.
If Super Micro transforms the East Brokaw site into a new tech campus, it would become the third major hub for the tech company and create a triangle of employment with points all within a mile of each other.
The company’s headquarters at present are at 980 Rock Avenue in San Jose.
Super Micro accomplished the East Brokaw property purchase at a time when the company’s sales have hopped higher and profits have soared.
During the 12 months that ended in December, Super Micro earned $732.4 million on revenue of $9.25 billion. Over the one-year period that ended in June 2023, the company earned $640 million on revenue of $7.12 billion.
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