Following its recent two purchases in Bellevue, Seattle-based Vulcan Real Estate is looking to bring about 800,000 square feet of office space in the Eastside city. The Puget Sound Business Journal reported that the property located at 555 108th Ave. NE, may soon see heights permitted up to 600 feet according to new zoning rules, which will expand significantly the current height of 450 feet.
Vulcan’s Director of Real Estate Investment Strategy, Lori Mason Curran, stated that the development will bring retail on the ground floor as well as subterranean parking. She added that Vulcan is looking at options of bringing that space in one tower or possibly two towers of 20 stories each.
According to Mason Curran, the company does not have any tenants lined up for the development, but at this point in time, with the project being basically in a conceptual phase, that is not surprising.
According to a recent, second quarter of 2017 Eastside Office Market Overview by The Broderick Group, overall demand on the Eastside is strong from credit tenants, and new construction is now mostly full with very little new product scheduled to be delivered in the next two years. Vulcan is Amazon’s largest landlord in Seattle, and with e-commerce giant taking space in downtown Bellevue, the report states it may not be a coincidence that Vulcan is following suit and making a larger stake in the Eastside city.
The Eastside market is seeing vacancy hovering just under 12 percent, although the Class A properties in the central business district are just under 17 percent. The A+ assets in the CBD, however are seeing vacancy at 8.65 percent, showing that interest in the high end product is outpacing the market overall in the CBD locations.
Vulcan paid $24.255 million in July of 2017 to acquire two lots in Belleuve located at 435-437 108th Avenue NE. Then just days after transaction closed it took another parcel on the same block for $26 million, according to public documents filed with the county.
No information about Vulcan’s plans for the location were available at that time, but the accumulation of property in this very attractive corridor shows Vulcan is looking at the Bellevue submarket very seriously. When the company paid $45.35 million in May of 2016 to acquire its first Bellevue CBD location, the Bellevue Plaza, Ada M. Healey, vice president of real estate at Vulcan Inc. stated: “Bellevue is a major economic driver in the region, and is home to a growing number of residents and companies. Our purchase of Bellevue Plaza aligns with our focus on expanding our Pacific Northwest portfolio with value-add investments and urban infill projects.”
