Weyerhaeuser: Woodsy Urban

Weyerhaeuser’s Lobby Area.  Photo: Anthony Bolante/Puget Sound Business Journal

Weyerhaeuser’s new headquarters has moved “out of the woods” and into the urban core, to paraphrase The New York Times. A number of large, local companies decided recently to move their suburban headquarters to the Seattle core, including Weyerhaeuser, in an attempt to attract new talent who might prefer the perks of a downtown lifestyle. Another reason Weyerhaeuser decided to move is their previous location, which they occupied for 45 years, was deemed too big. Last autumn, they moved most of their office (between 700-800 employees) from a sprawling 430-acre campus in Federal Way to a single, new building in downtown Seattle. Their 166,000 square foot building is adjacent to Occidental Park, a community in transition, in the Pioneer Square area which is 3 blocks from a transit hub.

Weyerhaeuser Building in Pioneer Square.  Photo: Stuart Isett/The New York Times

Exterior of Weyerhaeuser Building.  Photo: Greg Gilbert/The Seattle Times

The exterior of the Weyerhaeuser building (220 Occidental Avenue South) is understated with quality details, and makes an effort to blend with the historic brick buildings that surround it.  An overhang and mason end walls align with the cornices of the historic buildings around the square, for an even line or flow from building-to-building. Also in keeping with its historic environment and Weyerhaeuser’s 116+ years in business, the bricks on the new building were placed by-hand, highly unusual these days, instead of a prefabricated sheet of bricks. The structure was developed by Urban Visions, who chose to work with architecture firm Mithun.

Weyerhaeuser lunch room with Elizabeth MacPherson, Mithun principal. Photo: Greg Gilbert/The Seattle Times

Photo: Greg Gilbert/The Seattle Times

Weyerhaeuser produces wood products + land-related endeavors, and these materials are highlighted in their interior space, with the occasional burst of color (such as furniture). In the lobby, an employee’s photo of trees in a woods has been converted into a large digital wall mural. The ceilings, walls, tables, desks and other elements are often made from their own sustainable timber or made of natural materials. There’s quite a few windows for natural light. A rooftop garden. Studio SC’s large black and white wayfinding illustration of tree branches begins from an upper landing in the stairwell and works down floor-by-floor, ending with tree roots on a lower level. Even though this is a new building, a sense of history has been infused.

With the new building bordering the east side, Occidental Park is now enclosed on four sides and resembles a small, urban European plaza or Early American town square, especially during the summer. There’s seating available at the park, surrounded by hanging flowering baskets, older trees, and totem poles. Crime has dropped at the park by 2/3rds as of late July 2016, due to a very successful partnership between the Downtown Seattle Association and Seattle Parks & Recreation. As a result, a larger variety of people frequent the park because family-friendly events/activities, food trucks, games, and live music are now more commonplace. The re-invigoration of several downtown parks usually means an eventual rise in real estate values and a renewal of businesses in the vicinity. Weyerhaeuser, steeped in a long history with sustainable endeavors, is no stranger to renewal.

Occidental Park outside Weyerhaeuser headquarters.  Photo: Stuart Isett/The New York Times

Pioneer Square “Ruin” to Become Seattle’s Newest Boutique Hotel

metropole

Commonly dated to 1892, the Metropole Building in Pioneer Square is about to be transformed in the city’s newest boutique hotel.  The building’s finely proportioned façade, articulated in the Richardsonian Romanesque style, has been boarded up since a fire extensively damaged its interior in 2007.  While some restoration work was carried out inside the building following the fire, today, the Metropole resembles a ruin.

In 2015 Seneca ventures purchased the Metropole building for $4 million, planning to turn the dilapidated historical building into a boutique hotel with dining and retail space on its first floor. BuildingWork, a Seattle-based firm, has been hired to undertake the transformation. Matt Aalfs, the owner and principal of BuidlingWork, told the Daily Journal of Commerce that the hotel will have 36 guest rooms, about half of which will be “micro private rooms” geared towards single travelers and those on a budget. The micro rooms will be 120 square feet, but will have private, ensuite bathrooms.  Standard rooms at the hotel will be 220 square feet.

If the permitting process runs smoothly, construction could begin on the Metropole as early as September.  Before any work can begin though, the development team is seeking approval from the National Park Service in order to procure federal historic preservation tax credits, which will provie vital in the financing of the project.

Commercial Lease Rates Hitting New Heights In Seattle

seattle sunsetThe Highway 99 Blues Club, established in 2004 and located in the basement of a hundred-year-old brick building, is possibly one of the best blues clubs in Seattle. As reported by The Seattle Times, in June, the business was notified that their rent would be increasing. Somewhat normal and understandable considering the immense growth Seattle overall is experiencing, especially downtown. However, their rent isn’t going up just $500, or even $1,000. Starting in January 2016, the blues club, if they intended on staying, would be responsible for paying $14, 959 a month. That’s an increase of 225 percent (or $10,359 more a month) and how the business sees it, an eviction notice.

The commercial real estate market in Seattle is reaching new heights, quite literally and figuratively speaking, so much so that downtown tenants, like the Highway 99 Blues club, are being squeezed out due to astronomical rent increases. This gentrification of downtown Seattle is well supported, as companies haven’t a problem finding tenants to fill local office space in exchange for a pretty penny. In fact, not only are rents 7.5 percent higher (an average of $36.76 a square foot) than last year, but in June of this year “the vacancy rate was 11.4 percent, down nearly by half from its high of 21 percent five years ago,” according to the Seattle Times.

This rise in lease rates in Seattle, Bellevue, and surrounding areas has been greater than any other metro area in the US, and that includes tech hotspots like San Francisco, San Jose, Boston, and New York, according to the New York based market research firm Reis. Still, Seattle is cheaper than Manhattan, San Francisco, and London, and currently offers a thriving and exponentially growing technology and health industry. In fact, many San Francisco-based businesses are on the hunt for Seattle offices, including cloud-computing giant, Salesforce.com.

It’s been reported that three-quarters of newly occupied office space in King, Snohomish and Pierce counties is located in downtown Seattle. Last year a top floor office space went for $30 a square foot, this year a lower floor office space in the same building is asking $36 a square foot. That’s a 20 percent rent increase. Demand for land is what is moving these prices, as business owners are paying huge premiums and signing large lease transactions in order secure a spot to set up shop.

Adding to the difficultly in securing an already existing office in downtown Seattle or nearby areas, many companies are signing pre-leases on buildings that are still under construction. Some of these companies being:

–          Amazon just leased 817,000-square-feet of Troy Block, which is part of two-building project in South Lake Union.

–          Holland America Line just leased Martin Selig’s new 185,000 square foot building in Lower Queen Anne, set to open next year.

–          Tableau Software is set to lease a new 2016 210,000-square-foot building north of Gas Works Park.

–          And Juno Therapeutics leased 287,000 square foot building which is under construction at 400 Dexter Ave. N in South Lake Union.

It certainly seems “Seattle is a landlords market,” Stuart Williams, managing director of commercial real-estate brokerage JLL told The Seattle Times. This isn’t a playground for the mom and pop smaller tenant. This game is only available for big time tenants ready to pay up, commit to long term leases and wait patiently for their space in the ever changing Seattle metropolis.

No Horsing Around – Union Stables Restored

TUNE, architecture firm Weinstein A+U, and joint owner of the building, general contractor Lease Crutcher Lewis will take up the ole’ nine to five in arguably one of the coolest workspaces in Seattle. Once housing over 300 horses, employees of TUNE, Weinstein A+U, and Lewis will be the first human tenants to move into the building.

An ode to Seattle’s pioneering days, the landmark building was used as a livery stable, housing horses used for deliveries and to pull streetcars. Once considered the most modern building west of the Mississippi, the building has seen fires, earthquakes and was the scene of a major Prohibition raid back in 1923.

Paying respects to the building’s rich history, Lewis persevered and reused 127,000 board feet of lumber and milled old beams from the original building turning them into flooring and other materials. Additionally he reused every single road brick, as road brick is no longer available. Timber chewed and rubbed on by the horses can be seen throughout the build, as well as a large V-shaped hay cart which will be hung in the lobby of the building as “a nice little reminder of what the building was like..,” Dave Rauma, Lewis senior project manager said, according to the Puget Sound Business Journal.

Offering exposed beams, bike storage, and a green roof on part of the building, the renovation hits a sweet balance in paying homage to the past while setting an energy conscious precedent for the future. Going beyond the boundaries of the building, thinking of our carbon footprint, Lewis anticipates the green roof to be certified LEED gold, and hopes to outfit his office at the highest LEED certification, LEED platinum. It seems this waterfront building has jumped leaps and bounds ahead of its time and is quickly becoming more legendary than its historic past. With the tone set, let’s hope to see some legendary business for the companies settling in.

Union Stables Building

2200 Western Ave.

Seattle, WA 98121

Real Estate Steps into the 21st Century with Cloud Based Apps

Seattle, known as a progressive leader in information and technology, houses established companies and growing start-ups alike. As Amazon expands, Facebook moves in, and numerous start-ups take up stake in Seattle’s burgeoning technology hub, it is evident the commercial real estate industry, a sector some would say is lagging on the technological front,  is a major player in assisting these innovative companies set up shop.

According to the Puget Sound Business Journal, in 2014, high-tech tenants accounted for 45 percent of leasing activity in Seattle. That’s a good chuck of business coming from a client base who appreciates system innovation – it would be wise if the real estate sector jumped aboard the techie train and geared their marketing strategy towards their forward thinking client base.

That is exactly what co-founder of Hightower, Brandon Weber and Floored CEO, Dave Eisenberg are monopolizing on. Seattle based, Hightower, takes commercial leasing to that magical place everyone seems to love – the cloud. Allowing for full business execution in the palm of your hand, Hightower allows commercial owners and brokers to manage their entire portfolio, leasing documents, and collaborate with their leasing team all in real time. Joining forces with New York City based company, Floored, a fully interactive 3D visual tool for the real estate industry, Weber and Eisenberg have created a full-bodied leasing platform like no other.

“Tenants struggle to visualize how space might look, landlords spend billions of dollars on speculative space construction,” Brandon Weber, explained to Commercial Observer. “Floored greatly reduces this need by delivering a virtual tour experience showing the tenant exactly how their space will look once built out. We believe this can save Landlords billions in spec build out costs.”

Between Hightower’s mobile app technology and Floored’s 3D visual sophistication, brokers and building owners have the ability to virtually walk clients through available properties that provide such robust example of what the space could look like, that the platform is unmatched with anything else out there. What a refreshing game changer – but it is changing the game?

According to the Puget Sound Business Journal, Weber says Hightower is tracking more than 10,000 vacant office spaces, and that figure is growing 20 percent a month. Hoping to streamline his business for bi-coastal clients, Weber is excited at the prospect of assisting a Los Angeles tenant find property in New York via the Hightower application.

Thanks to new kids on the block, infusing life into the real estate industry, like Hightower and Floored, maybe some of the biggest names in the business will step into the 21st century.

Two Seattle High Rise Buildings Under Design Review

 

970 denny

Photo Courtesy of the Daily Journal of Commerce

Two new proposals for towers under review in Seattle’s downtown core. According to the Daily Journal of Commerce, design review meetings have been set for the towers, the first a 39 story residential tower located at 1613 2nd Avenue, and the second a 40 story mixed-use building at 970 Denny Way. The Wood Partners are interested in building the 39 story tower on 2nd Ave, and have listed 1,000 planned sq ft of street level retail space, as well as parking designated for 140 stalls, four levels below ground, and 6 levels above ground. An early review meeting is scheduled for this project on January 20th at 7pm, in Seattle City Hall.

Holland Partner Group is also planning a 400 ft building at the intersection of Denny Way and Terry Avenue North. The design plans include 500 residential units, 17,000 sf of retail space and 450 parking stalls. For more information on Seattle Real Estate, contact your local real estate agent today.

Chinese Buyers Big Players In Seattle Real Estate – And Getting Bigger

bellevue homePeople from China bought more than $2 billion in residential real estate in the Puget Sound area in 2013, and it doesn’t appear that that number will be decreasing anytime soon, according to a new report by the Puget Sound Business Journal. Chinese buyers are lured here by our clean air and good schools, and by the fact that they are able to buy a large home here for the same price that a small condo would cost in Beijing or Shanghai.

Tere Foster, a residential agent with Windermere, told the PSBJ that while many Chinese buyers buy homes here to use as their residence, many also buy them simply as part of an investment portfolio and let them sit vacant. Chinese investor groups have also been getting in on the commercial market in the past several years, having bought the First Congregational Church property in Bellevue for $30 million, and another Bellevue development site for $31 million. Many transactions, for sales of both residential and commercial properties, are being conducted in all cash, making closings much quicker than those involving financing, an obvious incentive for sellers.

Local brokerages are fully embracing the influx from East Asia, hiring Mandarin-speaking agents and forming divisions specifically to serve Chinese buyers. PSBJ cites a statistic from the National Association of Realtors that says there are more than 2 million millionaires in China, 47 percent of whom plan to move out of China within the next five years, meaning that the flow from China to Seattle has most likely just begun.

City Council Votes To Enact Mandatory Developer Fees

towersThe Seattle City Council voted 7-2 Monday to make real estate developer fees that would go toward building affordable housing mandatory; until now, developer fees have been voluntary. As reported by the Puget Sound Business Journal, the Affordable Housing Linkage Fee Program will require commercial and residential developers to pay a fee of anywhere from $5 to $22 per square foot of rentable space in the building, or make 3 to 5 percent of the building’s units available to those who make 80 percent or less of the area’s median income. According to KIRO, that works out to no more than $1,200 for a one-bedroom apartment.

Linkage fees will apply to developments mainly in commercial areas and multi-family residential zones, and will range from $16-$22 per square foot in Downtown and South Lake Union to as low as $5-$7 per square foot in the Rainier Valley and North Seattle (see the map of where fees would be applied here). The money generated by the fees would be used to build housing for people making 60 to 80 percent of the median income, which works out to $45,000 to $65,000 for a family of four, according to The Seattle Times. The fees would not apply to buildings in single-family neighborhoods.

Before the city council vote, a group of 13 land-use lawyers sent a letter to the council opposing the mandatory fees, saying they were illegal under current state law.

If you are interested in learning about housing in Seattle, contact your local real estate agent today.

Bertha Under Repair – Viaduct Status Update

99 tunnel access pit

Photo Courtesy of Washington State Department of Transportation

The 99 tunnel-boring machine dubbed big “Bertha” has experienced a few set backs since getting stuck last winter, but the WSDOT wants Seattle to know that work is still underway on the project. According to the Daily Journal of Commerce, Bertha may be out of commission until March, but over 230 construction workers are currently on site near the South end of the tunnel, and 58 of those workers are busily working to repair Bertha.

Seattle Tunnel Partners are working around schedules to ensure as much work as possible is getting completed while the machine is under repair, and noted that new infrastructure is getting built much sooner than originally scheduled. Electrical and fire suppression systems are being installed at this time, and the roadway South of the tunnel is also underway. The benefits of completing work before Bertha is ready will be evident when Seattle Tunnel Partners make up for the significant time lost while Bertha has been under repair. There has been a lot of negative coverage on the status of this project and seemingly lack of progression, but WSDOT would like tax payers to know construction is moving forward, and progression is evident. For more information on Seattle real estate, contact your local real estate agent today!

Nine Office Buildings For Sale Around the Sound

This just in: Chicago based private equity real estate firm Walton Street Capital has listed 9 office buildings in the Puget Sound area, according to the Daily Journal of Commerce.Two of the buildings that hit the market are located in downtown Seattle, one at 1111 3rd Ave, and the other (just kitty corner to it), at 2nd & Spring. Six of the other apartmentsbuildings listed are located in Bellevue, and the other is the Island Corporate Center on Mercer Island. The portfolio for sale totals over 2 million sf of office space, a large slice of inventory for the firm to place on the market at one time. Walton Street Capital bought 11 offices in the surrounding Seattle area after a previous owner defaulted on a $900 million dollar loan. Seeing a win-win opportunity, Walton, along with several bankers bought some of that heavily discounted debt, and set themselves up for success to take control of the buildings once the owner defaulted. If you’re in the market to purchase or sell commercial real estate in Seattle, contact your local real estate agent today.