(EDITOR’S NOTE: According sources familiar with the details of the transaction, the deal closed December 14, 2016 for $217 million, or roughly $452 per square foot. While the recorded deed lists the price at $202.7 million, there were some credits given to the buyer for pending tenant improvements and leasing commissions.
Principal Real Estate Investors made the decision to sell 112th at 12th partially because the firm felt it was over-exposed to Bellevue for its core open-ended commingled fund, the Principal U.S. Property Account. Besides the 112th property, it has two other office properties in the portfolio in the city. One of them is a new, 462,000-square-foot office building located at 929 110th Street, which is currently under construction. The real estate manager is building this property for a build-to-core strategy in a joint venture with Trammell Crow. The second one, which is in close proximity to this property, is Lincoln Plaza, a 150,000 square foot asset located at the corner of 112th Ave. SE and SE 6th Street.
“We felt that it didn’t make sense to have three office buildings in the same market for diversification purposes. 112th at 12th was a very sizable asset, and we had owned it since 2004, so it wouldn’t be bad to move it out of the portfolio at this time,” said Rod Vogel, a senior manager director with Principal.
The company had paid $137 million to acquire 112th at 12th in 2004. The asset had a gross asset value of $205 million as of the end of June 2016, according to a pension fund document. The property on that date had been 70 percent occupied. Over the last several months, Principal was able to improve the occupancy with some new signed leases. Some tenants in the property now include Voice Box Technology and Century Link.)
December 13, 2016 – Gemini Rosemont, LLC, a leading real estate investment company with holdings of approximately 13.6 million square feet of commercial office space, has acquired One Twelfth @ Twelfth, a three building office campus in the Seattle submarket of Bellevue, Wash.
We expect additional acquisitions in the Puget Sound region in the near future
The acquisition of the Class A office campus adds 480,389 rentable square feet to the company’s portfolio. Gemini Rosemont now owns 67 properties comprised of 109 buildings in 20 U.S. states.
Gemini Rosemont purchased the office campus in partnership with Gemini Investments, an investment company listed on the Hong Kong Stock Exchange. The price was not disclosed.
“Adding One Twelfth @ Twelfth to our portfolio supports Gemini Rosemont’s desire to expand our footprint in the western U.S.,” said Michael Mahony, chief executive officer of Gemini Rosemont. “The Seattle-Bellevue MSA is a very desirable live/work/play community featuring a diverse industry base. The highly skilled and educated work force that choses to live here supports a strong and growing office sector. We expect additional acquisitions in the Puget Sound region in the near future.”
This is the third office building acquisition in 2016 by Gemini Rosemont. The company added Raleigh-Durham’s six-story, 131,976 square foot SouthCourt office building in early November. It also acquired the 19-story, 177,489 square foot 610 West Ash office tower in San Diego’s downtown Little Italy district to its portfolio in April.
“One Twelfth @ Twelfth is the complete package from an investment standpoint,” said Don Henry, chief operating officer and chief investment officer for Gemini Rosemont. “It is a fully-leased property located in a campus setting in a dynamic submarket that we have been targeting for our investors. The property generates a stable income return but also has potential for capital appreciation due to its location and being in the path of growth.”
The LEED Gold certified office campus sits adjacent to Interstate-405, Eastside’s primary transportation corridor, offering unmatched access and highway visibility. Built in
2001, the property features high quality office space, large and efficient floor plates, comprehensive onsite and nearby amenities, an above-market parking ratio, and superior transportation access and visibility.
“We have identified a number of ‘smart capital’ investments that we can make at One Twelfth @ Twelfth, including an upgrade of the building amenities and the use of the common courtyard as a focal point to enhance the tenant experience,” said Jason Kuester, Gemini Rosemont’s senior vice president of acquisitions.
The Eastdil Secured team of Jason Flynn, managing director, Kayln McClure, senior vice president, and Reid Rader, vice president, brokered the transaction.
Led by KG Investment Properties’ regional director Josh Shearer, the property will be managed onsite by Shawn Gilson, senior property manager (425-559-3024). The Broderick Group’s Grant Yerke (425-646-5264) and Jeff Watson (425-646-5224) will handle leasing.
About Gemini Rosemont Commercial Real Estate
Headquartered in Santa Fe, New Mexico, Gemini Rosemont Commercial Real Estate is a market leader in commercial real estate acquisition and investment management. The company’s portfolio is comprised of over 100 buildings totaling approximately 13.6 million square feet in over 20 states across the U.S.
Since October 2010, Gemini Rosemont has acquired approximately 7.6 million square feet of Class A and B multi-tenant office assets in select markets valued at more than $1.2 billion. As of December 2016, Gemini Rosemont has sponsored more than 160 investment vehicles, deployed over $900 million of investor equity to make more than $2.7 billion in purchases, and has acquired/managed approximately 30 million square feet of commercial real estate.
Founded in 1992, Gemini Rosemont employs 200 real estate and other professionals. It has 11 regional offices located in Albuquerque, Atlanta, Chicago, Dallas, Denver, Houston, Los Angeles, New York, Peoria, San Antonio and Tulsa. For more information, please visit GeminiRosemont.com.