Los Angeles-based Hayman Properties LLC acquired its first property in the Puget Sound when it purchased the Microsoft Redmond Woods Campus from New York-based Clarion Partners LLC last Wednesday for just under $37 million, or approximately $255 per square foot, according to public records. The sale was confirmed by Kevin Shannon, the president for west coast capital markets for Newmark Grubb Knight Frank in El Segundo, Calif., the brokerage firm that represented the buyer. Brokers Tom Pehl and Lou Senini with CBRE represented the seller on the transaction. Hayman Properties and Clarion Partners were both unavailable for comment.
The Redmond Woods Campus consists of three two-story buildings situated in the city’s southwest corner, just west of Highway 520. Located at 5000, 5010 and 5020 148th Avenue, the office campus offers a total of around 145,000 square feet of space that is fully leased. Tenants other than Microsoft include Nokia and Mindtree. According to Shannon, the property was not on the market for a long period of time. “I think Hayman Properties will invest more in the Seattle area,” said Shannon. “They’re in many other markets, and I think they are attracted to the great rent growth and credit quality.”
I think Hayman Properties will invest more in the Seattle area
According to Cushman & Wakefield’s 2016 First Quarter Office Snapshot Report, overall vacancy in the Eastside has gone down approximately 0.03 percent to 9.7 percent compared to 2015 first quarter. As the vacancy rate dropped, the square feet of net absorption increased to 439,000 square feet and the overall average asking rent increased to $33.20. There is also an additional 1,148,000 square feet under construction, says the same report.
With the overall vacancy rate dropping and leasing activity rising 6.3 percent on a quarter-over-quarter basis, the outlook for the Eastside remains positive, especially considering REI’s recent announcement of a possible relocation to Bellevue by 2020, says the Cushman & Wakefield report. Centre 425 and 400 Lincoln Square’s year-end delivery will add 1 million square feet that should attract tenants seeking prime Class A office space in the Eastside. Expedia’s planned relocation to the former Amgen Helix campus on Elliott Bay in the Seattle CBD in 2019 will add even more space to the market. Asking rents should decrease once all this additional inventory is made available, says the report.
According to Cushman & Wakefield’s report, there were two key Redmond sales transactions in the first quarter of 2016. One of these is the sale of two buildings from the Quadrant Willows, a total of 129,972 square feet that sold for $25.7 million, or $197 per square foot. The other transaction was The Offices at Riverpark, a 106,281 square-foot complex that sold for $36.9, or $347 per square foot, says the same report.