Seattle Office Space News – January 2014

News

Below are comments and links to news articles and other topics relevant to the Seattle office space market from the month of January 2014.

BUILDING SALES

Investment activity in Seattle’s office market continued to be strong through the month of January.  720 Olive Way, which consists of 301,000 square feet of office space in 20 stories, is on the market for sale.   Built in 1981 and renovated in 2004, the building owned by Hines is expected to sell for roughly $120 Million or ~$398 per square foot.

Equity Office Properties of Chicago sold the World Trade Center East building (2211 Elliott Ave) to LaSalle Investment Management for $74.5 Million.  The price for the 187,000 square foot office building built in 1999 equates to ~$414 per square foot.  Unico was then hired to manage the building as they continue to diversify their ownership and management portfolio in anticipation of the expiration of their land lease contract with the UW for downtown’s metropolitan tract.

Merrill Place, a 191,000 square foot historic office building located at 411 1st Ave S, was sold by Nitze Stagen for $57.7 Million.  Hudson Pacific Properties paid $302 per square foot for the building originally built in 1906.  The high price per square foot can be attributed to future development opportunities on the site that will be in addition to the existing building.

Sun capital Corp purchased the Pioneer Building at 606 1st Ave in Pioneer Square for $12.3 Million. Richard and Dorothy Sikora sold the 72,000 square foot office building, originally constructed in 1892, for ~$170 per square foot.

PROPOSED DEVELOPMENTS

Ground has broken for the first phase of Amazon’s proposed 3.3 Million square foot development in South Lake Union.  This article provides an interesting time-lapse video showing the pouring of over 11,000 cubic yards of concrete for the foundation of the first 3 buildings.  In addition, Amazon exercised their right to purchase a block between Bell & Blanchard and 7th & 8th, which is adjacent to their proposed campus, for $52 Million from Clise Properties.  Amazon has rights to purchase additional land nearby for what could be a continued expansion of their headquarters in South Lake Union.

Vulcan Real Estate is seeking  a master use permit to develop two more six-story 194,000 square foot office buildings on Eighth Ave N in South Lake Union.  These buildings would be in addition to the two 12-story office buildings Vulcan is building on Ninth Ave N.

Touchstone Corp. is considering building a mixed use project at 1812 Boren Ave on the current site of a Goodyear service center.  The project would include offices and housing.

Legacy Commercial is looking to build a mixed use building on 11th Avenue and East Pine Street in Capitol Hill.  The project would include 14,000 square feet of retail, 53,000 square feet of offices and 20 residents.

TUNNEL/VIADUCT

There was lots of news in January concerning the tunnel project that will eventually replace the Alaskan Way viaduct on Seattle’s waterfront.  Some ponder whether retail operations will recover after the extensive construction period in the area.   For most of the month, crews tried to figure out what was blocking Bertha, the machine boring the tunnel. Eventually it was discovered that an eight inch steel pipe was the cause of the delay.  Late in the month, crews were finding more blockage in Bertha’s massive spokes that have stopped the digging machine since early December 2013.  Throughout January it was quite the cluster of finger pointing regarding who was at fault for not knowing about the obstructing objects.  Towards the end of the month it was reported that WSDOT crews were able to stay productive working on other aspects of the project.  Finally, it appears that Bertha will begin tunneling the week of January 27-31 and should complete 2 more feet of progress of the 1.7 mile distance.

ECONOMY

Always a strong economic indicator, the residential real estate market has bounced back from the recession and sales volume has reached its highest level since 2007 with 75,517 closed sales in 2013 in the region.

OTHER NEWS

Two architecture firms, MulvannyG2 and NBBJ, are on the hunt for new office space.  Both firms are reportedly looking for more than 50,000 square feet.

Jordan Selig, daughter of Seattle office building mogul Martin Selig, is back in Seattle and getting into the family development business.  This article provides background on Jordan and her plans.

Here is a look at pictures of Twitter’s Seattle engineering office.

Finally, here is an interesting look at the history of development of Seattle broken down by decade.

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