By Meghan Hall
While downtown Seattle and the city’s immediately surrounding neighborhoods attract the bulk of investor interest when it comes to office space, investors are increasingly looking not just east, but south for value-add opportunities. Sites that are vacant, or properties that are developed with aging office buildings, are poised for redevelopment, something that Portland-based Gateway Alta Rainier LLC, an entity associated with Trina Sanders and Wood Partners, realized in its recent acquisition of 3717 S. Alaska St. According to King County public documents, Gateway Alta Rainier purchased the 1967 office building and an adjacent parcel at 4715 38th Ave. S. on May 29th for $16.693 million. The seller was Seattle-based Rainier Pacific Properties.
The two-story office building totals 23,250 square feet, and according to assessors’ documents, the property and adjacent parcel are valued at $6.16 million and $810,000, respectively. The size of the first property is 1.57 acres or 68,400 square feet, providing Gateway Alta Rainier ample opportunity to redevelop the site into a larger office building should they choose. The adjacent parcel on 38th Ave. S. is currently 6,000 square feet and is developed as a parking lot. King County assessors’ data shows that the site is zoned for commercial uses.
The property is located at the beginning of a more commercial corridor along Rainier Ave. S.; just down the street from the office building are numerous small businesses and eateries such as Bike Works Seattle, Columbia City Bakery, Seattle Gymnastics Academy and Empire Espresso. 3717 S. Alaska is also just across the street from the Rainier Playfield, Rainier Community Center and Columbia Park, where the local farmers market is held. Surrounding development also includes single-family residential.
According to Kidder Mathews’ first quarter office report, the regional office market remains strong, even in peripheral Seattle submarkets such as Columbia City. Kidder Mathews reports that South Seattle submarkets posted a vacancy rate of 5.3 percent at the end of the first quarter, indicating there’s room to grow.
Rainier Pacific Properties, which sold the property, is a family-owned real estate firm that seeks to acquire, develop and operate property of all types in Washington. The firm was established in 1986 and has a multitude of projects underway around the Puget Sound, including another in Columbia City. Rainier Pacific plans to work with Lake Union Partners to redevelop the 23,000 square foot Columbia City Post Office into a 242-unit mixed-use apartment and retail building. Rainier Pacific also has several projects in Bellevue, Eastgate and nearby Rainier.