American Assets Set to Snap Up City Center Bellevue in Deal Worth $229M
- Aug 14, 2012
City Center Bellevue is the object of the latest large office property purchase in the greater Seattle area, after American Assets Trust Inc. made a grab for the high-rise building. The full-service, vertically integrated and self-administered real estate investment trust is reportedly set to acquire the downtown property for a sum that stands at approximately $229 million. The transaction would be financed partially with cash and partially with funds drawn against American Assets’ existing credit facility. The property will be used by American Assets in a mortgage financing deal immediately after closing the deal.
City Center Bellevue is a 27-story office tower offering around 497,000 square feet of leasable space in the center of Bellevue’s business district. Located at 500 108th Ave. N.E., the skyscraper offers views of nearby Mount Rainier, Lake Washington, as well as Seattle’s skyline and other notable scenery such as the Olympic Mountains. The location also provides the building’s tenants with easy access to nearby amenities, including the area’s public transportation system and freeway proximity.
According to the buyer, the building will have a 92 percent occupancy rate when the sale is completed. Current tenants include names such as Caradigm, HDR Engineering Inc., Intellus Inc., Sucker Punch Productions L.L.C., Global Scholar Inc., Cisco Systems Inc. and Morgan Stanley. In a statement about the project, American Assets’ president & CEO noted that Bellevue “has been a target investment region for the company and its predecessor for many years.” Further details on the deal cannot be released until its confirmed completion; however, the transaction is reported to be structured to accommodate a possible tax-deferred exchange under Section 1031 of the Internal Revenue Code of 1986 and applicable state revenue and taxation code sections.
The greater Seattle area has seen some improvement in the way office space reaches the market and then gets absorbed by tenants. Although the amount of space that now gets completed has clearly decreased, 2012 should see a strong conversion rate by year’s end, as Marcus & Millichap predicted at the end of 2011′s fourth quarter. The vacancy rate is also on a steady downward curve.
Chart courtesy of marcusmillichap.com
Photo courtesy of user Rsocol via Wikimedia Commons