Below are comments and links to news articles and other topics relevant to the Seattle office space market from the month of November 2019.
It was revealed in November that the 10-story Rainier Square hotel tower will now be office space according to developer Wright Runstad & Co. The construction will begin next spring just south of the almost complete Rainier Square skyscraper. The tower will be called 400 University @ Rainier Square and have 110,000 square feet of office space with a restaurant and lounge.
Martin Selig owns a full block of real estate at 75 Marion St and plans to redevelop it. Earlier this month the redevelopment came up for design review. The plan includes approximately 209,000 square feet of office space, plus retail, 106 residential units and 278 underground parking stall. The total project size is about 519,000 square feet and will be 190 feet tall at roofline. Lease Crutcher Lewis is the general contractor. To view others involved in the project click here.
Unico Properties acquired the Washington Park Building located at 76 S Washington St in the spring and now they plan to fully renovate the structure with the help of developer Lake Union Partners and architect BuildingWork. The current plan is to remove the mezzanine and give the building a full seismic retrofit along with a new penthouse and surrounding terrace. The building will have 48,000 square feet of office and 6,000 square feet of restaurant and retail space.
Touchstone-Portman JV announced they would ground lease and develop two large lots owned by University District Parking Associates. The two buildings would offer nearly 400,000 square feet. Building A is an 11-story building located at 4530 12th Ave with around 240,000 square feet of office and Building B is a 9-story building located 4536 Brooklyn Ave NE with around 152,000 square feet of office. The buildings will likely open after the light rail service begins. More offices may be developed along University Way but the street’s future zoning has yet to be determined.
November’s biggest office sale was by Vulcan Real Estate who sold Arbor Blocks located in South Lake Union at 300 and 333 8th Ave N for around $415 million to Ponte Gadea Seattle LLC which is associated with Ponte Gadea Group of Miami. Facebook currently occupies the space. In 2000, Vulcan paid $8.5 million for the land. The deal was worth approximately $1,069 per square foot. The buildings have a total of 388,100 square feet and 845 underground parking stalls.
The Urban Renaissance Group purchased the Park Place Building located at 1200 6th Ave for $177M. The seller was related to Washington Holdings. The deal was worth $570 per square foot and the building is over 95% leased with 230 underground parking stalls.
The First & Stewart building located at 101 Stewart St sold for $52.9 million. The seller was L&B CIP First & Stewart LLC, and the buyer was associated with Deutsche Bank. The deal was worth $561 per square foot. The building is 94,333 square feet and has 32 underground parking stalls.
This month NAIOP hosted a breakfast that discussed the possible slowdown to come in 2020. The event’s participants included Kidder Matthew’s Dylan Simon, Zillow’s Skylar Olsen and Windermere’s Matthew Gardner. Gardner stated that there will be cycles of expansion and recession and that growth is unsustainable. Olsen mentioned, the economy will level out and things will slow down. The gist of the discussion is that a slowdown in Seattle won’t happen in 2020 and at the earliest will be Q3 2021. To read more about the discussion click here.
In both King and Pierce County home prices have stabilized, but in outlying counties including Thurston, Kitsap and Whatcom home prices have seen continued growth. Thurston County had the highest average growth with prices rising 11% since last year. One unusual explanation for the rising prices is certain counties are—gophers. The Mazama pocket gopher was added to the endangered species list in 2014. Builders had to abide by new codes to mitigate their impact. To read more about the impact click here.
Although outlying areas are growing faster, in King County there were 27.5% fewer homes on the market and year over year prices rose in Seattle by 3.3% as of October. This is the largest increase in 12 months according to NWMLS. Within some of the priciest Seattle neighborhoods double-digit price growth was seen. The median price last month in these neighborhoods was $1.18 million—up 15% from last year.
According to the latest census data, “from 2010 to 2018, the share of Seattle commuters who drove alone to work dropped by nearly 9 percentage points, the biggest decline along the 100 largest U.S. cities.” Seattle has seen a decrease in the number of workers who drive or carpool to work and an increase in those who walk or use transit.
More and more Seattle residents use the vast transit system to get to work likely because of how hard it is to get around. A recent study by Clever analyzed the 50 most populous U.S. metro areas annual cost to commute and Seattle was in the top five worst metros for commuting. Seattle ranked 37th in time of commute, 33rd in annual maintenance costs and 44th in annual fuel costs.
F5 Networks recently occupied their new home located at 801 5th Ave now called the F5 Tower. The company occupies 515,000 square feet of space across 28 floors. The lower portion is a hotel space that is not yet occupied. There are currently around 1,500 employees located in the tower with room for up to 1,900 employees. NBBJ was the architect on the office renovation project.
Zipwhip new 75,000 square foot Seattle HQ located in the Elliott Bay Office Park offers epic sunset views and has room for their 275 person team to grow. Zipwhip raised $51.5 million Series D investment round in January. The new office space includes a variety of workstations, offering both group collaboration and private stations. To see photos of their new space and view click here.