By Jon Peterson
Opportunities for the life science sector across the greater Puget Sound region are capturing interest from national investment companies. Lincoln Property Company, through its Portland/Seattle office, has closed on the purchase of a life science development site in Seattle located at 222 Fifth Avenue North. The purchase price was $42 million, according to public records.
Lincoln has acquired the site with financial backing from the Los Angeles-office of Intercontinental Real Estate Corporation. Both of these real estate firms did not respond to a phone call seeking comment on the sale.
The seller of the development site was Da Li Development USA. It was represented in the transaction by the CBRE office in Seattle. CBRE declined to comment when contacted. The seller had been the owner of the site since March of 2019 when it had acquired the site for for $18.1 million, according to public records.
The original idea for the site was to build condos. The property owners then changed their mind and though a better use would be for a life science project. The entitlements for this have now been secured. Da Li had been in the market to find a firm to be an equity partner, however, the company then made the decision to just sell the site.
The asset as it stands now has an existing structure. This is a McDonalds restaurant, which leases the premises on a month-to-month basis.
The expectation is that the parcel should be ready for construction at some point early next year. The project would bring a building that would total somewhere in the neighborhood of 190,000 square feet. The new ownership is planning to start the project on a speculative basis given the strong interest for leasing this kind of space in the market. Through the first half of 2021, the vacancy for Class A life science space in Seattle is hovering around 2.7 percent, according to data compiled by CBRE.
The purchase of the development site at 222 Fifth Avenue North will be the second recent transaction that Lincoln and Intercontinental have completed together. The other occurred in September on a long-term ground lease on the development of University District Station Building. This is a 12-story 266,000 square foot office development located two blocks from the University of Washington. The building is scheduled for completion in 2024.