By Jon Peterson
Bellevue-based PMF Investments has placed on the market for sale the 34,873 square foot Studio 7500 office property in Redmond located at 7500 166th Avenue Northeast, according to sources familiar with the property. No pricing guidance was available at this time.
The seller has hired the Seattle office of CBRE Capital Markets to be the listing agent on the sale. Among those working on the sale include Tom Pehl and Lou Senini, both Senior Vice Presidents. PMF did not respond to a phone call seeking comment for this story. CBRE declined to comment.
PMF has owned the property since April of 2017. It had bought the property for $9.2 million, according to public records. The property at that time was owned as corporate store for REI. The ownership has since then transformed the store into an office building that has a brand-new lease with Volkswagen. The lease will start this November and last for 12 years. It has a triple-net structure, and operating expenses are fully reimbursed including repairs of the roof, garage, HVAC and amortized capital expenditures.
The type of buyer to be interested in the property could include private capital investors, high net-worth individuals and 1031 exchange buyers. The plan for the new ownership group would be to hold the asset as a core investment. Down the road, there could be a possibility to redevelop the asset. The current zoning may allow for the property to be turned into apartments, for instance.
The original development of the property was completed in 1998. The property has a total of 131 total parking stalls, which includes 111 surface stalls and 20 street front non-exclusive easement stalls.
Studio 7500 will become a strong transit location in the future. The property is located across the street from the downtown Redmond light rail station. This is projected to open in 2024 and get riders 10 minutes to the Microsoft headquarters campus, 15 minutes to the Spring District, 18 minutes to downtown Bellevue and 45 minutes to downtown Seattle.
The office building market in Redmond remains very tight. The current vacancy in the market is 2.9 percent with very little if any new development, according to sources that track this data. The market has a total inventory of 4.1 million square feet with rents being in excess of $39 per square foot on a full-service gross basis.