Home Commercial Charlie’s Produce Adds to Growing Seattle Industrial Portfolio, Pays $72.6MM in Latest...

Charlie’s Produce Adds to Growing Seattle Industrial Portfolio, Pays $72.6MM in Latest Deal

Charlie’s Produce, Seattle, Cascade Designs, South Seattle Distribution Center, La Salle Property Trust, Boeing,
Courtesy of JLL Income Property Trust

By Meghan Hall

Just months after buying one of its own warehouses from investors, Charlie’s Produce has closed on another acquisition that will solidify its future in Seattle. In a transaction that closed at the end of last week, the grocer purchased the South Seattle Distribution Center for $72.6 million, according to public documents. The seller of the asset is affiliated with JLL’s Income Property Trust and LaSalle Investment Management.

Known as the South Seattle Distribution Center, the property was originally acquired by JLL in 2013 for $38.7 million, or about $120 per square foot. The asset was constructed over several phases in 1949, 1968 and 1980 and totals 323,000 square feet.

The South Seattle Distribution Center is 100 percent leased. Charlie’s Produce is currently the largest tenant in the mix, occupying 182,000 square feet. Cascade Designs, which manufactures and distributes outdoor and camping gear, has leased 82,000 square feet, while the City of Seattle Fire Department has leased 60,000 square feet for equipment storage.

In October, Charlie’s Produce purchased its headquarters from 13 different investors who had tenancy in common. Located just blocks from its newest buy, the fruit and vegetable distributor paid $17 million for several buildings located between 4103 and 4143 Second Ave. S. All located on the same parcel, the property is developed with 104,099 square feet of space, built in 1953. In all, the property totals 3.28 acres. 

According to a third quarter report released by JLL, e-commerce and distribution continued propelling the market forward through the end of the year. Several large leases were signed and $143 million in industrial sales closed in the third quarter as investors remain bullish on the market. Vacancy, at 5.2 percent region-wide, as well as direct asking rents, at $0.81 per square foot, remained stable, as did concessions.

JLL predicts that the industrial market is well-positioned heading into 2020, even as uncertainty caused by the future of aerospace companies like Boeing remains uncertain.

“Market activity is still showing strong fundamentals as industrial real estate has become the bellwether property sector. E-commerce and logistics are the driving force in the Puget Sound market and once again are responsible for the largest leases signed in Q3,” states JLL. “…The Puget Sound continues to recuperate jobs lost from the onset of the pandemic and with large tech companies hiring at a fast clip, we should see the population continue to grow.”