In the past five years, some of the largest industrial leases recorded in the Puget Sound region, such as the recently completed buildings in the Redmond Ridge development that now house SpaceX’s Starlink operation, have reflected the growing presence of space-related ventures across the greater Seattle area, according to a report from the Puget Sound Business Journal.
Bill Ellis, the chief economic development officer for Kent, told the Business Journal that the region has been fortunate to witness significant spending and investment from the space sector during a time when commercial aerospace faced challenges, effectively supporting the industrial landscape. Although the space industry remains relatively small compared to the overall industrial leasing market, demand for large distribution facilities has been a primary driver in recent months, Elliott Krivenko, director of Seattle-area market analytics for CoStar Group, said in the report. Nonetheless, the space industry is expanding rapidly, particularly in areas like Redmond and Kent.
According to the report, the space sector is a significant employer in Washington, with more than 13,000 people directly employed in the industry. Kent Valley is home to around half of these workers while approximately 25 percent are located in Redmond. In the past three years, there has been a construction surge of over 2.5 million square feet on 160 acres of land in Kent, according to the report. A substantial portion of this new construction has been taken up by manufacturers, including expansions by Blue Origin and Stoke Space at the Pacific Gateway industrial park. Krivenko told the Business Journal that certain areas like Redmond, Bothell and Seattle’s Sodo neighborhood face limitations on adding industrial space due to strong demand from other industries, such as technology.
Kristina Hudson, CEO of economic development group OneRedmond, told the Business Journal that existing businesses in the area are making the most of their current facilities or expanding their spaces close to their current locations. Additionally, some local companies are capitalizing on hybrid and remote work options, allowing them to hire more employees without the need to expand their office spaces. On the other hand, as software and tech companies, including Microsoft, undergo consolidation, Hudson said in the report that there is potential for more available square footage that could be utilized by the growing space sector, further supporting its expansion in the region.
While the market for manufacturing space remains tight, SpaceX, led by Elon Musk, stands out as the clear leader in satellite production. Approximately four out of every ten satellites currently in orbit are built by SpaceX to support its Starlink network, the report stated. SpaceX’s valuation is estimated at $150 billion following a capital raise, and its revenue is projected to reach $8 billion this year.
Startup space companies often utilize older, opportunistic spaces close to their founders, with an emphasis on remote work when possible, Hudson said in the report. Larger companies, on the other hand, tend to build or lease properties near available technical labor. Amazon’s Project Kuiper, headquartered in downtown Redmond, illustrates this trend as it shifts from a research-and-development focus to large-scale commercial production. The demand for skilled aerospace labor has played a role in attracting companies like Kuiper to the region, leading to positive effects as space-tech firms source parts and materials from local Washington vendors.
