By Jack Stubbs
There has been substantial activity occurring along Willows Road in Redmond over the last few months, and another property recently changed hands.
Graymark Capital, a San Francisco-based company that acquires and manages institutional-quality commercial real estate in the Western U.S., acquired Building C of the Willows Commerce Park for $19 million, or approximately $240 per square foot, King County records show. Graymark acquired the property from Menlo Equities, a private commercial real estate investment firm based in Menlo Park, California.
The buyer did not respond to emailed requests for comment about the transaction in time for the publishing of this story.
The transaction included a three-story office building—located at 9805 Willows Road within the four-building Willows Commerce Park in Redmond—constructed in 1999 that totals 79,072 square feet, according to public documents. The high tech/high flex property, which sits on just over 11 acres, is Building C of Willows Commerce Park, a 421,415 square foot Class A complex sitting in the Willows Road submarket of Redmond.
Founded in 2005, Graymark Capital invests in assets with a modern design that appeal to today’s tenants and targets infill communities along the West Coast—some of which include San Francisco, Silicon Valley, Portland and Seattle—that have strong employment growth and attractive quality of life, according to the company’s web site. Graymark prepares a specifically-tailored strategy for each asset and looks to maximize their value through full renovation or repositioning. Since 2012, the company has purchased 18 properties consisting of over 1.8 million square feet and over $540 million of value, according to its web site.
Founded in 1994, Menlo Equities invests in office properties in select technology-driven submarkets throughout economic and real estate cycles, according to the company’s web site. Since its founding, Menlo Equities has acquired or developed 110 properties with a total capitalized value of approximately $5.7 billion.
The company’s Puget Sound region portfolio also includes two office/R&D properties totaling approximately 117,000 square feet—located at 11351 and 11261 Willows Road NE—which are part of the seven-building, 400,000 square foot Quadrant Willows Corporate Center. The company’s portfolio also includes a 100,985 square foot office building located at 18300 Redmond Way in Redmond.
Menlo Park-based Facebook has been active in the Eastside market over the last few months. In late October, the company expanded its footprint by taking down 85,000 square feet across two buildings owned by Kilroy Realty in Bellevue: the Key Center located at 601 108th Ave. NE and the Skyline Tower, located at 10900 NE 4th St.
The technology company has also made its presence known closer to Redmond as well, since the beginning of 2018. In January 2018, the company acquired two high tech/flex buildings in Redmond totaling just over 72,000 square feet for $20 million from Redmond-based Crane Aerospace Inc. And Facebook has amassed nearly 700,000 square feet of office space across a number of properties around Redmond’s Willows Road, according to sources with direct knowledge of the company’s activities in the region.
Facebook continues to explore the growing world of virtual reality: in mid-August 2018, BuildZoom tracked $106 million in construction and development permits filed over the past three years for Facebook Oculus’ offices in Redmond. Analyzing data from BuildZoom’s National Permit Database, the company found that of more than 180 permits were filed, issued and finalized for Oculus projects across 11 buildings in Redmond. In total, Facebook had spent more than $106 million since July 2015 to develop labs and offices there, with $88.3 million of those permits filed in 2018 alone.