Blackstone has acquired a 134,000-square-foot manufacturing facility in Sunnyvale for $95 million, underscoring growing investor focus on buildings with significant electrical capacity. The property, located at 350 Cobalt Way, is leased to Nvidia, which will remain in place following the transaction. Originally constructed in 1978, the asset underwent an upgrade in 2022. SFF Realty Partners sold the building to Blackstone, according to the report.
The facility is notable for its power profile, with the Silicon Valley Business Journal reporting that it has nearly 10 megawatts of electrical capacity. That level of infrastructure is increasingly important for research and development and advanced manufacturing users, which are seeking more power than the local grid can readily supply. As a result, existing buildings that already offer high power capacity are gaining a competitive edge in today’s market.
Market observers note that both investors and tenants are actively pursuing these power-rich properties, as they can support energy-intensive uses tied to artificial intelligence and other advanced computing applications. The combination of upgraded infrastructure and substantial power availability appears to be a key factor in the positioning of the Sunnyvale asset.
In a related example of this trend, OpenAI is nearing a lease agreement for another high-power building in the region. The company is pursuing a 70,000-square-foot property at 2950 Zanker Road in North San Jose that is reported to offer about 19 megawatts of electrical capacity. While that transaction has not yet been finalized, it illustrates the strong tenant demand for locations that can deliver robust and reliable power.
Blackstone has been explicitly aligning its investment strategy with infrastructure that supports AI-related growth. The firm’s Chief Financial Officer, Michael Chae, told investors this month that data centers, power assets, and other forms of digital infrastructure have played a significant role in the performance of Blackstone’s infrastructure business. The Sunnyvale acquisition fits within that broader focus on properties and platforms that can meet the needs of high-power users.
These developments highlight how electrical capacity is becoming a differentiator for industrial and R&D assets in Silicon Valley, influencing both capital allocation decisions and site selection for technology and AI firms. As users seek to scale computing and manufacturing operations, buildings capable of delivering high power loads are emerging as priority targets for both occupiers and institutional buyers.
