By Kate Snyder
The loan on a 720,000-square-foot office complex in Renton that was recently returned to the lender, Miami-based Starwood Capital Group, is now up for sale, according to marketing information from Newmark, which has the listing. The $293 million loan on the property, which is part of Southport on Lake Washington, was originated in 2021 and is now in default.
Located at 1133 Lake Washington Blvd., the full Southport campus comprises 17 acres of waterfront property that along with the three nine-story office buildings at the center of the current market listing also includes the 347-room Hyatt Regency Lake Washington and the 383-unit Bristol Residences.
According to information from Newmark, the fixed-rate loan on the office complex had an initial 12-month term and featured two six-month extension options. The loan was extended in March 2022 and September 2022 via those contractual options, which gave the loan its final maturity date of March 2023. In April, after the loan fell into default, it was seized by the lender.
As of last month, the property was 22 percent leased with a weighted average lease term of 10.5 years, according to Newmark. Along with the office area, the property has 11,025 square feet of retail space and 2,121 vehicle stalls in a seven-story parking garage. The property also features more than 1,200 operable windows, outdoor courtyards and direct access to both Gene Coulon Park and Lake Washington.
In 2017, the previous owner and developer, SECO Development, arranged $265 million in construction financing through Cushman & Wakefield for the office complex, which broke ground in 2016, according to The Registry’s earlier reporting. In January of 2021, the construction loan was converted to permanent financing totaling roughly $328 million, which was provided by Starwood Capital Group.
In early 2021, SECO’s CEO, Michael Christ announced that the property had a decent amount of activity and that the physical attributes of the building were a draw for would-be tenants. Later that year, rumors swirled about the office property hitting the market, which Christ disputed, although he acknowledged that if presented with an offer, he would consider it.
Exxel Pacific filed a lien earlier this month for $786,000. It stated in the document that the last work performed at the site was on March 20th of this year. As a subcontractor working with Exxel, Appian Construction also has a lien for roughly $130,000. Blue Star Welding is claiming $38,000 and MacDonald Miller Facility Services around $9,000. West Coast Painting is looking to recoup $17,000, Smith Fire Systems another $31,000, Schaefer Construction nearly $21,000 and Wayne’s Roofing just over $60,000.
