By Meghan Hall
Kent, Wash.-based Alco Investment Company has made a big investment into the Eastside, acquiring two flex/life sciences complexes in Redmond and Bothell for a combined $155 million. The deals for Redmond East and Canyon Park East closed yesterday, according to a source familiar with the transaction. The seller was Los Angeles-based Kennedy Wilson; both assets were held in the same closed-end fund, Kennedy Wilson Fund VI.
In the larger of the two transactions, Alco purchased Redmond East for $80 million, or about $276 per rentable square foot. Kennedy Wilson first purchased the property back in May of 2018 for $52.125 million, according to public records. The complex is an eight-building campus in Redmond, located at 6645, 6565, 6675, 6724, 6742, 6812 185th Ave NE, and 18578 and 18640 NE 67th Court. Together, the buildings total 289,880 square feet. The property is 100 percent directly leased, however Buildings Two and Three—totaling 19,303 square feet and 21,643 square feet, respectively—are vacant and available for sublease.
In the second deal, Alco acquired Canyon Park East for $75 million. Kennedy Wilson purchased the property from Blackstone for $54.625 million in December of 2019 and later received a $38.635 million loan to finance the acquisition. Canyon Park East includes five buildings that total 269,906 square feet and are located at 22011, 22002, 22028 & 22215 26th Avenue SE and 2525 223rd Street SE. Currently, the property is 83 percent leased and has 45,000 square feet available for occupancy. Alco has begun looking to lease the space and is targeting life science, biotech and flex tenants.
Alco was represented by Lee and Associates, while CBRE represented Kennedy Wilson on the Redmond East Sale.
Alco, a private family-owned investment firm, purchased the properties as part of a 1031 exchange related to their sale of Pittock Block, a Portland telecommunications hub. Alco intends to hold onto both properties long-term and capitalize on the Eastside’s continued expansion.
The latest acquisitions come just a few months after Alco closed on two other Eastside deals: the purchase of the offices of Systima Technologies and Pathway Medical Technologies. Combined, Alco paid about $28.5 million for the offices, which are located just adjacent to each other. The firm continues to seek out a mix of office, flex/industrial, retail and tech buildings located across the Pacific Northwest. Typically, Alco seeks out investments between $2 million and $50 million according to its website, making the acquisition of Redmond East and Canyon Park East some of the firm’s largest. Alco is continuing to evaluate opportunities throughout the region, leveraging its portfolio to make additional investments as the Pacific Northwest grows.