Below are comments and links to news articles and other topics relevant to the Seattle office space market from the month of March 2017.
Seattle continues to be at an all-time high construction boom. At the end of 2016, over 68 major projects were underway (from Sodo- South Lake Union) the most of any time since recording began in 2005. Nearly two thirds of that development is in the multifamily sector with the remaining third being large office developments.
Earlier this year it was announced that Big Fish Games will be moving to the renovated Maritime Building on Seattle’s waterfront at 911 Western Ave. The developer has now filed plans showing that the project will be complete for occupancy by mid-2018, just a year before the new waterfront promenade is estimated to be completed.
Unico Properties acquired a 60,000 square foot building at 701 Dexter in South Lake Union a little over a year ago and have just filed plans for a renovation. Due to height restrictions in the area, Unico plans to extend the building envelope over what is currently a surface parking lot to create 40,000 additional square feet of office space. Unico has not released a timeline for construction to begin.
At the corner of Second and Union, crews have begun to demolish several small buildings to make room for Skanska’s 2+U project. The 650,000 square foot office project is expected to be completed in the second quarter of 2019.
This month, mayor Ed Murray signed legislation allowing for the upzone of the University District. This is the first Seattle neighborhood to use HALA (Housing Affordability and Livability Agenda) which allows for developers to build higher buildings in exchange for contributions towards affordable housing. Many sites in the University district can now be built up to 320 feet for residential towers and 160 feet for office. Using the same HALA framework, a similar plan is currently in the works for both South Lake Union and the Downtown core. The Seattle City Council will vote in April whether to approve this measure.
There were no reports of significant office building sales in March.
Another month, another huge lease for Amazon. The ecommerce giant has just leased all 300,000 square feet of the Tilt 49 office building in South Lake Union. The developer, Touchstone, has been working on the project since 2015 and expects to be complete near the end of this year.
In addition, the DJC took a look at the new North Highland offices in Seattle, where they have leased and renovated just under 6,000 square feet of the historic Standard Building.
According to the most recent Silicon Valley Competitiveness and Innovation Project’s report, Seattle’s population is growing at nearly double the rate of Silicon Valley. Much of the population increase is due to Seattle based tech giants such as Amazon and Microsoft, but more and more Bay Area companies such as Google and Facebook continue to expand in the Northwest as well. Although Seattle’s job growth has started to outpace the valley, Seattle continues to lag when compared to other tech hubs in the number of venture capital fundings and IPO’s.
With all of this Job Growth the Seattle-area unemployment rate has dropped to 3.5% in February with the United States unemployment rate holding steady at 4.7%. In addition, the Seattle area was the ninth fastest growing metro region in the nation according to population estimates by the U.S. Census Bureau.
After a brief winter slowdown, King County homes have surged to record heights. The median single family home price was $560,000in February up 6.7% from January. The new price levels mean that Seattle homes have nearly doubled in median price over the last five years. New data from Zillow, suggest that Seattle has the second fastest home value increase in the nation.
Bertha’s course was slightly altered this month after crews discovered that the machine was about six inches away from the correct location. The slight mishap did not seem to cause any delays and on March 28th the Seattle Tunnel Partners announced that Bertha is just 219 feet from its final destination. The new double-decker highway in the tunnel is still expected to open in 2019.
A new 360 video has also been released this month showing footage of how the highway is being assembled as Bertha continues to mine along.
The saga of if and when Seattle will see a new stadium has not become any more clear in the past few months. In 2016, the City did not approve a vacation of Occidental Avenue which would make potential developer Chris Hansen’s proposed SODO arena “shovel ready”, which is what it would take to attract a NBA team. At that same time, the City Council has been wrestling with the thought of what to do with publicly owned Key Arena in Queen Anne. Just recently, Hansen agreed to waive exclusivity to the Key Arena project and that has opened the process to other alternatives.
OVG and AEG are two entertainment firms that are sending redevelopment proposals for Key Arena to the city by April 12th. For now, we will have to wait and see what the City thinks of these proposals.
Two northwest projects have won Engineering News Record magazines “Best of the Best”. Google’s new office building in Kirkland won the green category while the new Allen Institute building in South Lake Union being named best higher education project.
The PSBJ also took a look at Tableau’s new Northedge Building in Wallingford, photos can be found here.
Finally, this month Geekwire chatted with molecular biologist John Medina on the effect of office space on employee’s happiness and productivity. Interestingly enough, Dr. Medina stated that a huge open office space is not always best, while it does seem to increase creativity it can be tough for many employees to focus on complex tasks in this environment. Medina did offer a warning that research in the topic is very early: “Our understanding of how (the brain) works is childlike, particularly in relationship to the kinds of questions we are asking about designing buildings”.