By Meghan Hall
While many Seattle office tenants pressed pause during the second quarter due coronavirus and concerns about the economy, there was one credit tenant who moved ahead full speed: Amazon. According to a recent report released by brokerage firm Newmark Knight Frank, Amazon took more than one million square feet across two Eastside leases during the second quarter. The first lease, located at 555 108th, is for 970,000 square feet in downtown Bellevue. The second is smaller, and includes 111,368 square feet at the Redmond Town Center.
555 108th Ave. NE is currently in development. Proposed by Vulcan Real Estate, the building is expected to be completed in 2023. Building amenities include a standalone retail pavilion, plaza and pedestrian public space, bike and locker rooms and multiple outdoor terraces, as well as parking.
“The tower is shaped by destination amenities on transfer floors, where terraces and balconies offer spill-out space and views to the south, culminating in a top-floor terrace behind iconic spires which reach to the sky,” explains Vulcan in a brochure detailing the project. “On both sides, the colorful curtainwall is inspired by cascading rainfall. Drawing upon the agricultural history of Bellevue, the pavilion roof recalls angular crop outlines, which merge with gestures in the street-level landscape and Grand Connection hill-climb.”
At 600 feet in height, the development will be taller than any other project in Bellevue.
The second lease, at the Redmond Town Center, is part of a retail center anchored by 24 Hour Fitness, BJ’s Restaurant and Brewery, and other shops. The space that Amazon leased was a former Macy’s department store. Including future space commitments, Amazon’s footprint in the Puget Sound now totals more than 18 million square feet. Microsoft, another one of the region’s biggest employers, is also located at the Redmond Town Center, where it occupies four buildings.
During the second quarter, the Eastside experienced a negative net absorption of 26,156 square feet, and rents dipped slightly, down 0.7 percent to $43.69 per square foot. The negative absorption over the past few months is the first slowdown for the Eastside since 2017. Vacancy also increased 10 basis points during Q2, from 4.8 to 4.9 percent, due to sublet space hitting the market, while the direct vacancy rate remained stable at 4.2 percent.