By Meghan Hall
Los Angeles-based development firm Kilroy Realty is moving forward quickly with its latest project in Seattle’s Denny Triangle neighborhood. Just months after closing on a deal to acquire a five parcel, 1.37-acre site near downtown, Kilroy has officially filed plans to redevelop the property into a 900,000 square foot mixed-use development, according to public property records.
The property, located at 500 and 600 Olive Way, 601 Stewart Street, 1825 7th Ave. and 1818 6th Ave., were sold by Vance Corp. for $133 million. The transaction was a two-part deal in which 601 Stewart, 1818 6th Ave., 600 Olive and 500 Olive, were purchased for $95 million. The sale of 1825 7th Ave. closed for $38 million.
“We are excited to add another prime development opportunity to our portfolio in one of the country’s most vibrant and dynamic markets,” said John Kilroy, KRC’s Chairman and CEO in a statement when Kilroy announced the acquisition. “We are strong believers in Seattle and hope to continue to grow in this market over time. This opportunity fits our investment thesis well: extremely well-located, unsurpassed transportation options and surrounded by world-class tenants and amenities.”
Currently, the properties are home to a 31,000 square foot building fully leased to Bank of America, the 47,000 square foot Lloyd Building and related surface parking lots and parking structure.
Kilroy’s plans for the site include the full restoration of the Lloyd Building, located at 601 Stewart St. The Lloyd Building is currently 75 percent leased under a number of short-term leases. Originally designed by Victor W. Voorhees for Vance Lumber Co. in 1926, the building received its landmark status in 2010. Sharing the block with the Lloyd Building is the Tower Building. The structure, which rises 17-stories and was built in 1930, is still owned by Vance. Property records indicate its appraised value is about $47 million.
All other structures on the site will be demolished in order to make way for three towers, which will be a variety of uses. The first tower, to be located at 1825 Seventh Ave., is expected to be a 550 foot tall residential building, which will total 616,370 square feet. 2,065 square feet of retail is also allotted in the plans. The number of units and parking has yet to be determined.
The project site is easily accessible to the South Lake Union Trolley, the Westlake Light Rail Station, and is within walking distance of the city’s retail core. Major employers such as Amazon, including its corporate headquarters, as well as attractions such as Pike Place Market, are also nearby.
500 Olive Way, home to a Bank of America, will be replaced with another 500-foot tower. Designated as office space, the building will total 615,100 square feet, plus 2,500 square feet of retail and 330 parking space. 600 Olive Way, just adjacent, will also be office space. The new building will total 308,000 square feet of space, with 178 parking stalls.
Kilroy filed its plans in concert with architecture firm Miller Hull, with whom the firm also collaborated on its 333 Dexter project. The 635,000 square foot South Lake Union office project was recently fully leased to Facebook. As of the end of 2019, Kilroy’s Puget Sound portfolio was 98 percent leased. In February of this year, the firm announced that it had leased all of its space in its 1.8 million square foot Seattle portfolio after signing a ten-year lease for Microsoft subsidiary GitHub for 61,000 square feet of office at Skyline Tower. Across all markets, the office and life science portion of the company’s development projects under construction—which totals $2.1 billion in worth—are about 90 percent leased.