Norwegian Fund Invests in Menlo Park

Norges Bank Investment Management appears to have regained its appetite for top-tier U.S. office properties. The firm has acquired a $200 million property on storied Sand Hill Road.

Signs at the fancy entry to Sand Hill Commons display prominent tenants such as Sequoia, Battery Ventures, Morgan Stanley, and Robert Half - although some offices appear vacant and under reconstruction.

Sand Hill Commons has a history of record-breaking deals. In 2015, it set a national record for suburban office sales.

This time, Norges Bank Investment Management, which oversees Norway’s $1.4 trillion Government Pension Fund Global, led the $222 million deal. The fund acquired a 97.7% stake for $217 million, while DivcoWest, a U.S.-based real estate firm, purchased the remaining 2.3% and will manage the property.

The 133,449-square-foot campus features office spaces, a fitness center, a conference room, and a restaurant.

According to PERE news, this is the Norwegian fund’s first U.S. office investment in five years, signaling a renewed focus on premium properties in the United States. The campus was purchased debt-free from Clarion Partners and Invesco Real Estate.

Sand Hill Road, known as one of the most expensive commercial streets in the U.S., is home to many of Silicon Valley’s venture capital firms.