By Meghan Hall
New York City-based Tishman Speyer has officially closed on a deal to purchase a Bellevue development project after entering into contract in January. In a deal that closed on April 20th, Tishman Speyer purchased BelleVista for $152.5MM, according to public documents. The seller was Seattle-based PMF Investments.
The listing agent on the sale is Newmark, whose efforts are led by Kevin Shannon, co-head of U.S. Capital Markets, as well as Executive Managing Directors Ken White and Tim O’Keefe.
“Bellevue is one of the few pockets nationally where market fundamentals are standing out, validating new spec and office construction,” said Shannon. “The demand drivers are clear in the Seattle Eastside market with approximately one half of the existing office inventory being occupied by FAANG tenants and Microsoft. Capital market conditions for office product on the Eastside are also very strong with a new emerging life science growth engine now fueling additional demand.”
The property includes a five-acre site located at 100 112th Ave. NE, which is currently developed with the Sheraton Bellevue hotel. The hotel is currently closed and is not operational. PMF had initially purchased the property in 2016 for $41.8 million.
“Belle Vista Place is a beautifully designed mixed-use development that has the potential to take full advantage of Bellevue’s thriving Downtown core, expanding transportation options and world-class livability,” said Bellevue Mayor Lynne Robinson. “We are excited to see this project become a reality.”
In January, The Registry had reported that the asset had been placed under contract for about $155 million. At the time, PMF was walking the property through entitlements, which would allow for the development of one million square feet of office space, 145 multifamily units, as well as a two-acre plaza. Project completion, according to previous industry sources, would come over the next several years. Tishman Speyer also declined to comment for this story, saying it would not be releasing any statements at this time.
The Eastside continues to see interested investors snap up properties, and the average price per square foot for office product in the submarket has risen by85 percent since 2015. In recent data, Newmark also notes that asking rents have increased by 17 percent since the first quarter of 2018. Currently, the Eastside has about 34.3 million square feet of office space and a vacancy rate of 6.4 percent.
While a global firm, Tishman Speyer’s participation in local commercial real estate market has been fairly limited. Within the Puget Sound, Tishman Speyer owns just one other asset according to its website: a 396,000 square foot Class A property located in Seattle’s Central Business District known as 520 Pike Tower. Since Tishman Speyer was founded in 1978, however, the firm has acquired, developed and operated 453 projects, which total 210 million square feet of space. Its current portfolio includes $113 billion in total value across the United States, Europe, Latin America and Asia.