SANTA CLARA >> A South Bay office building defaulted on a property loan that tops $70 million, according to documents filed on Jan. 17 with the Santa Clara County Recorder’s Office.

PCCP, a Southern California real estate firm, is one of the principal companies that controls an affiliate that owns the office building at 2390 Mission College Blvd. in Santa Clara, according to county and state public records.

Luxembourg-based AB Commercial Real Estate Debt provided the now delinquent $72 million loan to the PCCP-led affiliate in 2022, county documents show.

This news organization reached out to PCCP to request a comment regarding the situation.

The office building totals 152,300 square feet and is located in one of Silicon Valley’s tech hubs. It is also next to San Tomas Aquino Creek, which offers open space, walking, jogging and biking trails.

As of Jan. 26, about 83,600 square feet of space was available for lease, according to CommercialSearch, which provides a database of commercial real estate properties. That would indicate the building was about 55% vacant.

The default notice means that the lender may seek to foreclose on the loan or auction off the building to interested parties. Future transactions involving the building will help to determine how much it’s worth.

The building’s loan delinquency has surfaced at a time when the South Bay office market has shown signs of reviving — although vacancy levels remain at high levels.

The South Bay office availability rate was 25.9% during the fourth quarter of 2024, an improvement from the rate of 27.5% over the final three months of 2023, reported Savills, a commercial real estate firm. The availability rate is the combination of empty office space plus space that tenants are offering for sublease.

A leasing boom during the final months of 2024 helped to spur improvement in the office vacancy rate in the South Bay. The transactions included:

• Snowflake, 773,000 square feet in Menlo Park.

• Amazon, 217,800 square feet in Mountain View.

• Astera Labs, 154,200 square feet in north San Jose.

• Robinhood, 128,700 square feet in Menlo Park.

• Nvidia, 101,600 square feet in north San Jose.

Still, the default for the Santa Clara office building is a reminder that pockets of weakness still haunt the Bay Area office market despite signs of improvement in regions such as the South Bay.