By Jon Peterson
Seattle-based Vulcan has put on the market for sale the 88,000 square foot 428 Westlake Avenue North office building in Seattle’s South Lake Union. This asset could attract a price point somewhere in the range of a mid $800 per square foot, as stated by sources familiar with the property.
Vulcan has hired the Seattle office of CBRE to market the property for sale. The listing agent on the sale is Tom Pehl, a senior vice president and director for the company in it Seattle office. He declined to comment when contacted for this story.
Vulcan’s motivation for the sale was led by its completion and execution of a lease with Amazon. “Now that we have signed the lease with Amazon, which makes the building fully occupied, we believe it’s a good time to market the property for sale where we can get top value for it,” says Lori Mason Curran, investment strategy director for real estate for Vulcan.
Amazon has not yet moved into the building. Vulcan isn’t sure exactly as to when this will be happening. Some tenant improvements are still being worked on in the office space of the building. The property was first developed in 2004 as the corporate headquarters of Tommy Bahama. This tenant needed more space for expansion, and this this building could not accommodate that for them. The high-end casual wear company had moved out last year to 400 Fairview Avenue North.
Vulcan was the original developer of 428 Westlake. It had been developed as a build-to-suit for the previous tenant. The property has a total of six stories, and there is roughly 81,000 square feet of office space and 7,000 square feet of retail. One of the tenants in the retail portion of the property is a branch of Key Bank.
The sales price on the property is projected to achieve a sub 5 percent cap rate, according to sources that track the sale of office buildings in South Lake Union. This return would be based on the property’s current net operating income.
428 Westlake is considered to be a boutique core asset. It will be one of the few Amazon-leased buildings in South Lake Union that will be sold for less than $100 million. For this reason, it could attract a wide range of buyers. This would include core commingled funds, some international capital, high net-worth individuals and family offices.
