While new leasing announcements have been rare recently in Seattle, Marcus & Millichap’s recent move showcases the firm’s commitment to the city’s downtown core. The company’s decision to relocate its Seattle office from Two Union Square to Rainier Square may have come as a surprise to some, especially since most tenants in the city seem to be shrinking their footprints while the brokerage firm is expanding.
Marcus & Millichap is planning to occupy roughly 11,000 square feet in a sublease from Amazon on the building’s 32nd floor, according to a recent report in the Puget Sound Business Journal. Some estimates put the tenant improvement contract as high as $1 million for the size of this office.
Marcus & Millichap was represented in the lease negotiations by Brian Hayden of Flinn Ferguson Cresa.
Rainier Square was planned to be a major expansion for Amazon in Seattle, and the firm had pre-leased the entire 720,000 square feet of office in the property. However, following a heated negotiation with the City Council, which was looking into imposing an employee tax on large employers in the city, the tech behemoth decided to shift its strategy and focus its expansion further into Bellevue, where it subsequently leased millions of square feet.
With most of the space at Rainier Square placed up for sublease, Amazon still has about 387,100 square feet there that it hopes to move.
Despite large tech firms enacting stricter return-to-work policies during the second quarter of 2023, Seattle’s total availability (vacant space plus occupied space being marketed as available) reached a new high of 28 percent, according to a second quarter of 2023 Seattle Office Market Overview by Broderick Group. This is largely the byproduct of large contiguous blocks of available office space hitting the market while larger users that usually occupy full floors of buildings have not yet resurfaced in the marketplace, the brokerage firm stated.
The revival of Amazon’s in-office operations has led to a noticeable uptick in pedestrian activity within downtown Seattle, particularly evident during peak commuting and lunchtime hours. However, despite the heightened presence of Amazon employees in the downtown area, the company decided not to extend its lease at West 8th during the quarter. This choice has contributed to approximately 320,000 square feet of new direct vacancy in the market.
