By Jack Stubbs
San Francisco-based real estate investment firm Swift Real Estate Partners sold the Swift Gateway Office Building on Friday, March 23rd for $25.5 million, or approximately $373 per square foot, according to public records filed with King County. The buyer of the property was Vancouver-based Nicola Crosby, the real estate division of Nicola Wealth Management Ltd.
Swift Real Estate is making a profit on the property, which the company acquired for $18.25 million in January 2016, according to public documents. Swift purchased the project at 51 percent leased, according to Kelsey Stuart, investment manager at Swift Real Estate Partners. “Swift Gateway is another example of Swift’s ability to reposition assets with high vacancy in order to provide a high quality workplace that attracts tenants seeking a discounted alternative to more costly neighboring urban markets,” Stuart said in an email.
The seller was represented by Andy Miller and Joe Lynch of Kidder Mathews’ Bellevue office.
The Swift Gateway Office Building, located at 915 118th Ave. SE. is three stories and totals 68,290 square feet, according to the property listing on Nicola Crosby’s web site. The building was originally constructed in 1989 and completely renovated in 2016, and is 96 percent leased.
The three-story Class A office building includes footplates that average 22,800 square feet, according to a flyer for the property. Some of the on-site amenities include a fitness center, conference facility and self-service market. The property also features newly-renovated common areas, including a two-story lobby with breakout areas and a full-height water feature.
According to the flyer, there are 2,200 square feet available on the third floor of the building. According to Google Maps, the building is currently occupied by human resource consulting company Lee Hecht Harrison; Lochner, an engineering consultant; and PrideStaff, an employment agency.
The property is approximately one mile to the southeast of downtown Bellevue and one-and-a-half miles from the South Bellevue Park and Ride. Additionally, the property is adjacent to Interstate-405 and approximately four miles from access to Interstate-90. The office building is also less than one mile from Bellefield Office Park, an office complex that totals 33,054 square feet.
Nicola Crosby, founded in 2000, oversees more than $2.3 billion worth of real estate in Canada and the U.S. (123 properties totaling $10 million-plus square feet), according to the company’s web site. The company has acquired $500 million of assets over the last 12 months.
Founded in 2010, Swift Real Estate Partners acquires and repositions office and industrial assets in select West Coast markets, according to the company’s web site. The company identifies unique opportunities and executes well-defined business plans while providing real-time, day-to-day oversight for each investment, and offers a variety of investment management services including acquisition, financing, leasing, disposition and construction management, according to its web site.
And the company has been in the news in the Bellevue office market in recent weeks. On Tuesday, March 6th, Swift sold the approximately 50,000 square foot Clover Building in Bellevue to AGM Inc. for $15.15 million, or approximately $303 per square foot.
The Eastside market has been active over the last several months. According to a fourth quarter 2017 Real Estate Market Review report written by Kidder Mathews, the Eastside office market ended 2017 with inventory totaling just less than 50.5 million square feet. The Bellevue CBD vacancy dropped to 7.6 percent from the 8.3 percent posted in third quarter 2017, but the CBD availability increased from 9.7 percent to 10.3 percent.
The report also notes how rental rates in the suburban submarkets around the Bellevue CBD have been steady with the economy’s stable support of smaller businesses. In a new trend, older low-rise office properties northeast of the CBD are seeing pressure from strong pricing for townhomes, which are changing the highest and best use of those sites, according to the report.