Nordstrom has agreed to lease all the downtown office space the Seattle Art Museum once rented to Washington Mutual, a deal that will help fill the deep financial hole the bank's collapse created for the museum.
Nordstrom has agreed to lease all the downtown office space the Seattle Art Museum once rented to Washington Mutual, a deal that will help fill the deep financial hole the bank’s collapse created for the museum.
Seattle developer Matt Griffin said Nordstrom, which had signed a lease a year ago for three-quarters of SAM’s space, agreed in November to lease the remainder — about half of it now, half in 2014.
The deal was only revealed Wednesday.
“We’re thrilled,” Griffin said. “It’s great to have good citizens like Nordstrom.”
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The space is in a 16-story building constructed in 2006 in conjunction with an adjoining 42-story tower then called the WaMu Center. The buildings were the products of a complicated development deal between SAM, Washington Mutual and the city that allowed the museum to expand and WaMu to build a new headquarters.
SAM owns eight floors in the 16-story tower, and was leasing all of them long-term to WaMu, collecting $5.8 million a year in rent, until the Federal Deposit Insurance Corp. seized the bank in September 2008 and sold its assets to JPMorgan Chase.
Chase, which laid off 80 percent of WaMu’s headquarters employees, announced in January 2009 that it was backing out of the lease with the museum.
The revenue loss hit SAM hard. It had been using the rent money to pay off bonds issued to finance its expansion.
Nordstrom’s decision a year ago to lease six of the eight former WaMu floors helped. So did a $10 million gift from Chase.
But the museum said in court papers last summer that it still faced a shortfall of up to $10 million because of the cancelled WaMu lease, and planned to borrow that much from its own endowment fund to make up the difference.
Nordstrom agreed in November to lease the remaining two floors, about 58,000 square feet. That will reduce the amount that must be borrowed from the endowment fund to about $7 million, museum spokeswoman Cara Egan said.
“It’s definitely a positive step forward for us,” she said. “We’re now stabilized, which is a really good feeling.”
In addition to the SAM space, Griffin said, Nordstrom also agreed in November to lease an additional 18,000 square feet in the former WaMu Center, where it had previously leased about 83,000 square feet a year ago.
The tower, now known as the Russell Investments Center, largely emptied after Washington Mutual’s collapse. Insurance giant Northwestern Mutual bought it in September 2009, and since has leased more than 80 percent of its 886,000 square feet to new tenants.
Nordstrom spokesman Colin Johnson said the retailer should start moving into the space it leased in November later this year.
Eric Pryne: 206-464-2231 or firstname.lastname@example.org