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Greystar’s Seattle Ambitions Grow

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Savills, Seattle, Puget Sound, technology

By Neil Gonzales

Multifamily developer Greystar’s ambitions continue to grow with Seattle’s booming real estate market.

In recent months, the South Carolina-based company has moved on new projects in the city’s Uptown, South Lake Union and Fremont neighborhoods to go along with all the other properties it already built, renovated or manages in Greater Puget Sound.

They have a large property-management product, and they will leverage their property management with their assets to be a dominant player in the market

“They have a large property-management product, and they will leverage their property management with their assets to be a dominant player in the market,” said Dylan Simon, Seattle-based vice president and multifamily specialist for commercial real estate services firm Colliers International. “They are focused on excellent sites and building great buildings.”

Among the new construction that Greystar aims to do is at 301 Queen Anne Ave. North in Uptown. The company has applied for permits to raze the existing property and build 182 apartments in two buildings ranging from studios to three bedrooms plus 14 live/work units, according to the city and Greystar’s architect, Seattle-based Weber Thompson.

In South Lake Union, according to the city, Greystar is pursuing a 433-unit development with a 24-story tower, a 7-story mid-rise, 9,500 square feet of ground-floor retail space and parking for 520 vehicles at 425 Fairview Ave. North. On just the other side at 400 Boren Ave. North, the company is eyeing a 7-story, 282-unit structure.

To the north in Fremont, Greystar has bought two newly built apartment communities at 3635 Woodland Park Ave. North and 3636 Stone Way North. Los Angeles-based Mack Urban was the developer of these buildings, which are blocks from each other.

“We’re seeing ongoing strong appetite from multifamily investors in apartments in the Seattle market because of the city’s job growth, lifestyle, amenities, diversity and overall appeal to a largely millennial population,” said David Young, Seattle-based managing director for commercial real estate services firm JLL who led the team that brokered the transaction of the two Fremont buildings.

“New builds, especially, are in high demand,” Young added in a news release announcing the sale.

Greystar could get even more aggressive in the Seattle market than it already has. Simon noted that Greystar reportedly has started raising capital for its largest value-add fund – up to $1 billion. “I assume they will have a component of that in Seattle,” he said.

“From what I noticed from the market,” he added, “it appears that they have a three-pronged strategy: They’re buying stabilized properties; they’re buying value-add properties; and they are also developing from the ground up. They’re developing a portfolio for the Northwest because presumably they see the growth in the high-tech sector and the great job growth.”

Greystar also sees a diversified economy that includes strong performances in the aerospace, biomedical, health-care and other fields, he said. So the company “sees the value in a long-term strategy in the Northwest.”

That strategy also involves focusing on “core locations or the best locations,” he said. Greystar targets urban locations adjacent to lifestyle amenities and employment.

A Greystar representative could not immediately be reached for comment.

While Greystar looks to be flexing its development and investment muscles more than ever, many other developers and investors are staking their claim in Puget Sound.

Greystar is “one of many,” said Peter Orser, director of the Runstad Center for Real Estate Studies at University of Washington. “There are a lot of institutional investors and local investors investing, building and permitting, and they are not all from Seattle but across the country and around the world.”

That just means continued robust construction activity into the foreseeable future fueled in large part by young, highly skilled workers “looking for urban housing that is close to their employment that is not a 30-year mortgage,” Orser said.