Seattle Office Space News – July 2015

News

Below are comments and links to news articles and other topics relevant to the Seattle office space market from the month of July 2015.

OFFICE DEVELOPMENTS

Amazon.com has been the catalyst tenant driving much of the positive absorption and growth in Seattle’s office market over the last few years.  In July it was reported that Amazon is not proceeding with the development of 1.1 Million square foot office building that was planned as an addition to their South Lake Union campus.  The fact that Amazon is seemingly indicating a slowdown in growth should give pause to the more optimistic local economists.

Urban Visions continues to roll out development options with the release of plans for what would be Seattle’s second tallest skyscraper. The one million square foot building at 888 Second Ave would be 880 feet tall and feature a 616 foot high atrium.

Martin Selig started construction on a three story office and retail building at Third and Battery in July. Sound community bank will be occupying the first floor and an undisclosed tenant will be occupying the entire second and part of the third floor.

BUILDING SALES

2201 Westlake sold in July for a record of $792 per square foot.  Vulcan unloladed the 317,000 square foot building to American Realty Advisors for $251 million. The building is 100% occupied and its largest tenants are Amazon and PATH.

OFFICE LEASES

Once again, the tech industry dominated office leasing news this month. Fast growing Tableau inked a lease for 210,000 square feet in the Northedge building between N. 34th street and N. Northlake Avenue in Fremont. The building being developed by Touchstone is currently under construction and will be ready for occupancy in mid-2016.

Fast growing legal tech Company Avvo will be moving into a new headquarters at 8th & Olive in the CBD. The company is taking 7 floors or ~105,000 square feet, which will leave enough room for the company to double its workforce.

News also broke this month that Apple has found a permanent home in Seattle. The California based company is rumored to have leased 30,000 square feet at Two Union square in downtown Seattle.

TUNNEL/VIADUCT

The Seattle based company responsible for repairing tunnel boring machine Bertha provided details for what caused the damage and massive delays in the project to replace the viaduct. Drilling is now expected to resume in November and completion is scheduled for the spring of 2018. While many are frustrated with the tunnel completion date continuing to slip, most in Seattle’s real estate industry are confident that the project will be completed eventually.

ECONOMY

The strength of the Seattle area housing market is supported by reports that over half the homes sold in June only lasted 9 days on the market.  Also, median home prices were up 3.8% on the month and 7.7% for the year.

Along with a hot housing market comes a robust apartment development climate. In Seattle there are currently three times more apartments under construction than there were in 2007, which was the height of the most recent development cycle.

Seattle appeared in Forbes magazine’s 2015 List of the Best Places for Business and Careers at #6 in the country.

The Washington State Convention center released new images of its proposal for a 1.2 million square foot and $1.4 billion dollar expansion. The new plans would have about 250,000 square feet of exhibition space, 510,000 square feet of support space and 500-800 additional parking spaces. There are also two adjacent sites that may be turned it to housing and apartments to help fund the project.

Looking forward to the second half of 2015, the Seattle economy continues to show mostly positive indicators with above average income levels and a 4.1% unemployment rate.  However, there seems to be increasing concern locally about a widening wealth gap given the amount of people on food stamps and a lack of affordable housing.

OTHER NEWS

Here is a look at the offices of The Adventure Hub. This space combines three businesses: A travel agency, wine cellar, and outdoor recreational guide service in to one cool space in Sodo.

The commercial real estate industry has tons of room for improvement and integration of better technology.  Some are leading the charge to catch up with technology by providing virtual reality tours of yet to be completed projects. Lake Union Partners and New York based Floor Inc, have created a virtual reality model of its project for the former Taboo video store at 1012 First Ave.

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