In what would be Seattle's biggest real-estate deal so far this year, a Chicago investment firm is negotiating to buy the Metropolitan Park...
In what would be Seattle’s biggest real-estate deal so far this year, a Chicago investment firm is negotiating to buy the Metropolitan Park office complex next to Interstate 5 north of downtown Seattle.
At going rates for office buildings, the deal, expected to include Park Place, another downtown office tower, could be worth $300 million to $400 million to the buildings’ owner, The Benaroya Co., brokers said.
Metropolitan Park — known among the real-estate community as the “Twin Toasters” for the rounded rectangular shape of its two first buildings — was developed in the 1980s by Seattle skyscraper builder Martin Selig.
In 1995, during a period of financial trouble, Selig sold his interest in the property to Benaroya for about $80 million. Benaroya added a third building to the project in 2001.
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The buyer, Walton Street Capital, which has raised nearly $2 billion for real-estate investment funds, including more than $700 million last year that the company’s Web site says is 66 percent invested.
Walton Street officials did not return calls yesterday. Benaroya spokesman Louis Richmond said the firm “receives many unsolicited offers for their properties, and they only make comments once a sale is finalized.”
The Met Park deal, which could close by the end of the year, is expected to include the older 21-story Park Place office tower at Sixth Avenue and Seneca Street.
If the deal goes through, some 1.2 million square feet of office space would change hands, almost as much as the 76-story Bank of America Tower.
News of the impending deal has come as a surprise in Seattle’s tight-knit real-estate community. Benaroya was not known to be marketing the property.
But for the last two years, real-estate investment trusts, international investment banks and pension funds have been scouring major cities looking for buildings to buy. Their purchases have effectively pumped billions of dollars into the Seattle-area real-estate community, in some cases giving local developers the money to start new projects.
Within the local real-estate community, The Benaroya Co., run by the family of founder Jack Benaroya, is known for its astute timing — buying in a buyer’s market and selling at the peak of a market.
Benaroya developed suburban warehouses and office parks, then sold much of its holdings in 1984 to two pension funds and Dallas-based developer Trammel Crow in a landmark $315 million deal. The commercial real-estate market began a severe slump not long afterward.
“They’re an opportunistic player,” said Scott Eshelman, a senior director at commercial brokerage Cushman & Wakefield. “They strike while the iron’s hot. They recognize that now is an excellent time to take advantage of all the money chasing these things.”
Kip Spencer of Officespace.com said Metropolitan Park’s value is enhanced by its stable list of tenants, including many health-related companies and nonprofits.
“They’re a Class A landlord, and they have Class A tenants,” Spencer said.
Others said Park Place is an intriguing property. The tower, built in 1971, is in a prime location between Union Square and the retail district.
“There’s tremendous demand (for office space) in the retail-core area,” said Don Fosseen, first vice president for investment properties at CB Richard Ellis. “That’s a great play.”
In another deal that reflects the high real-estate prices, an upscale 179-unit Kirkland apartment complex was bought this week for $66.8 million, or more than $373,000 a unit.
Condominium and apartment developer Continental Properties and partner Broadreach Capital bought the Carillon Heights apartments along Lake Washington from Skinner Corp.
Continental says it may convert some of the units to condos. Skinner built the apartments as part of its Carillon Point development in 1990 and says it does not intend to sell its other holdings at Carillon Point.
Tom Boyer: 206-464-2923 or firstname.lastname@example.org