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IRG Looks to Bring New Life To Its Mega Development in Federal Way

Seattle, Federal Way, Industrial Realty Group, Skidmore, Owings & Merrill, Weyerhaeuser Company,
Image courtesy of Industrial Realty Group

By Jack Stubbs

When Industrial Realty Group rebranded the former Weyerhaeuser headquarters in Federal Way as ‘The Greenline’ in October of last year, it became clear that big changes were planned for the development.

Completed in 1971 and designed by the venerable Chicago-based architecture and design firm Skidmore, Owings & Merrill, the building is located 23 miles south of Seattle in Federal Way, with immediate access to nearby Interstate-5. The property’s location is one of its main advantages, according to Tom Messmer, vice president of special projects at Industrial Realty Group (IRG), a leader in the adaptive reuse of existing commercial and industrial space. “From an industrial development standpoint…[the site] is bookended by exits from Interstate-5. We’re in a really good transportation corridor, we’re very close,” he said.

Notably, the property features 425 acres of green space—with 50 acres along the lakefront—manicured walking trails, lakes, pristine forest land, and the renowned Pacific Bonsai Museum and Rhododendron Species Botanical Garden, two occupants on the property. From its development until 2016, for 45 years Weyerhaeuser Company used the site as its global headquarters, where roughly 3,500 people worked. In February of last year, IRG acquired the site when Weyerhaeuser announced that they would be moving to a brand new headquarters in downtown Seattle’s Pioneer Square—a headquarters fit for the 21st century and the company’s evolving business and culture.

Weyerhaeuser’s announcement came as a surprise to residents of Federal Way, who had not expected the company to relocate, according to Messmer. “Earlier on, this process was a bit of a cold shower for the city, [and] they didn’t see Weyerhaeuser moving… Weyerhaeuser had some permanence here as far as residents were concerned. Many of them had worked [there], and nothing had changed on this side of the highway for 40 years…all of a sudden the company synonymous with Federal Way announced that it was leaving.”

While IRG has plans underway to eventually lease the office space and some additional industrial buildings on the site, the company is conscious of the need to strike a balance regarding development of the 425-acre space. “If we develop all that space, we take away what is special about the headquarters building. So we’re trying to find a balance here,” Messmer said. As things stand, IRG currently has 109 of the 425 acres planned for development. The company is conscious of the need to not over-develop, since the property’s unique location in Federal Way sets it apart. “[This] is an architectural gem sitting in a beautiful landscape. If we somehow [transform] that, then all we have is a ubiquitous office building that’s not in downtown Seattle,” Messmer said.

The corporate headquarters building, renamed ‘The Greenline,’ features 355,000 square feet of ‘Class A’ office space. However, the building—which contains five separate floors and is 500 feet long from end to end—is also known for its unique architectural and environmentally conscious design. In 2001, the building received the 25 Year Award for enduring significance from the American Institute of Architects.

Comprised of a series of ivy-covered rooftop terraces, ‘The Greenline’ was one of the first green roof applications in the Pacific Northwest, according to IRG’s web site. The space features large rectangular floor plates, 14-foot floor-to-floor heights with 10-foot ceilings, and a continuous non-sash window-wall system—architectural features that were all designed to promote natural daylight and maximize internal visibility in the space. Amenities in the building include a large cafeteria, assembly space with the capacity to accommodate 600 people, designated executive space and lush gardens.

One of the ways that IRG plans to reconcile the history of the property with its own long-term plans is to respect the occupants currently on-site—the Pacific Bonsai Museum and the Rhododendron Species Botanical Garden in particular. “We’re not developing directly adjacent to them…[They] are there for the long-term, and they really are an attraction to the property, but they’re on leases that have a finite end. They want a sense of permanence, so we’re trying to find a permanence for them beyond their ten year lease,” Messmer said.

The property also contains the Cultural Center, a 10,000 square foot building adjacent to the museum and garden that IRG has no plans to redevelop. The space offers the potential for a Day Care center directly adjacent to ‘The Greenline’ building, which would address a distinct shortage of additional services to the east of Interstate-5 around the property, according to Messmer.

When it comes to crafting the property in its vision, IRG is willing to take their time with the redevelopment project. “We do have a sense of urgency around this, but with a little extra work, you can meet both the sense of urgency and that diversity of uses and the big picture… we’re going the extra mile to find the higher and better use that fits our overall vision for the campus, which isn’t all industrial.”

IRG does not intend to alter the headquarter building’s exterior in any way, but has made some specific architectural changes to the interior, including a removal of 60-inch partitions that Weyerhaeuser had utilized. While specific, this alteration entirely transformed the building’s interior. “The building is now completely empty, which is the way people are using these kinds of buildings today: big open spaces, access to daylight,” Messmer said, adding that the current open floor concept is part of the building’s appeal: “Now it’s set up as a blank canvas, and we’re hoping that’s part of the attraction.” Messmer envisions that potential future tenants will likely opt to open up the office space even more, with alterations in workspace configuration having become a larger trend over the last several years. “People work differently than they did in the 70s, and that all has to do with the interior of the building…[the trend now] is open and reconfigurable workspace,” Messmer added.

Currently, available space on the property includes the entirety of the 355,000 square foot headquarters building, and roughly 120,000 square feet in the nearby Tech Center (Weyerhaeuser leased back the remaining 350,000 square feet), which includes a combination of lab, office and flex-space. IRG is not considering developing any residential or multifamily units, since the property isn’t zoned for residential use.

Preliminary interest in the available space on the property has largely depended on the current conditions of the industrial and commercial markets around Federal Way, according to Messmer, who has no doubts that IRG will be able to lease the industrial space. “The hot industrial market is between South Seattle and Pierce County, and we’re right in the center of that…the demand for industrial buildings in this [area] is very strong,” he said.

Conversely, IRG may have a harder time leasing the office space due to the property’s location. “The submarket of Auburn and Federal Way has the highest office market vacancy rating in the whole region,” Messmer said. However, Messmer believes that the unique and iconic quality of the larger headquarter building will mitigate this concern. “Even though we’re in a submarket with high vacancy rates, we have one of the most special buildings in the market, which gives us a leg up,” he said, adding that IRG is “in the hunt for the unicorn, but if we find the unicorn, we’ve really got something special to offer.”

While it remains unclear at this point which tenant will ultimately occupy the commercial space, tech companies cannot be ruled out as possible contenders, considering all of the frantic tech-based activity occurring in downtown Seattle. “We’ve thrown our hat into the ring with all of the big tech Request For Proposals,” Messmer said. At this point, however, IRG believes that it has laid out all of its cards on the table. ”We’re not going to have to overcome the quality of the building or the attributes of the site…but we will need someone with the vision who won’t need to be right downtown,” Messmer said.

IRG is currently moving through the approval process with the city of Federal Way for its industrial projects. The company submitted the State Environmental Policy Act (SEPA) application for the first building a year ago, and hopes to begin construction during next year’s building cycle. IRG has submitted most of the required SEPA work for the second project—which sits on 32 acres of land at the south end of the property—and hopes to break ground by the end of 2018. By the end of this week, the company will submit the SEPA application for the final development on the northern end of the property, which sits on 77 acres. Messmer expects that the third project will take around twelve to eighteen months to proceed through the city’s approval process.

In the meantime, though, IRG is biding its time. Messmer knows that, sooner or later, ‘The Greenline’ will have its moment. “The pendulum will swing, and we aren’t going to wait for it to swing on its own…but it’s going to take a couple of companies wanting to swing the pendulum once the pot overflows up [in Seattle]. Somebody is going to want an iconic building as a regional center to be proud of,” he said.