By Jon Peterson
New York City-based Clarion Partners has purchased the 74,853 square foot 500 Yale Avenue North office building in Seattle for $52.3 million, or close to $699 per square foot, according to sources that track the sale of office buildings in Seattle.
Clarion did not respond to a phone call seeking comment for this story.
The seller of the property was Seattle-based Urban Renaissance Group and its capital source from Chile. The previous owners of the building sold the asset through the Seattle office of CBRE with its Capital Markets Office West team. CBRE declined to comment when contacted for this story.
The sale of 500 Yale is a rare example of an investment in an office building in South Lake Union that may be deemed somewhat more affordable. Many of the newer and modern office buildings that have been placed on the market in that Seattle neighborhood have been sold at price points over $100 million.
The asset acquired by Clarion is one that is fully leased by WeWork, which occupies 71,029 square feet in the building. This company has a lease that lasts for another 14 years. The rental rate on the total space in the property comes in at 22 percent below market rents. A reason for this fact is that over the trailing 12 months lease comparables within the competitive set have increased by 13 percent.
WeWork is a very active player in the Seattle office market. It had leases in the region totaling 1.1 million square feet in 13 different locations when 500 Yale was placed on the market for sale in August. This company makes up for 64 percent of the total co-working space in the Seattle market, as stated by industry sources that track this information.