Hines Cashes Out Nicely on Seattle Data Center
- Dec 29, 2016
Seattle–Hines Global REIT has sold KOMO Plaza, a 292,700-square-foot, multi-tenant data center in downtown Seattle, to GI TC Seattle LLC, Hines announced Tuesday. The buyer is an affiliate of GI Partners, of San Francisco, and the price was about $276 million, excluding transaction costs and closing prorations.
The two-building property was completed in 2001 and was formerly known as Fisher Plaza. Though considered a data center, the property is actually mostly (64 percent) office and broadcast space, along with about 24,000 square feet of street-level retail. Overall current occupancy reportedly is 92 percent.
“There were many factors that made KOMO Plaza an attractive asset … among them its central location, high-quality infrastructure, excellent connectivity, best-in-class construction, strong tenant roster and substantial tenant infrastructure investment,” Sherri Schugart, president and CEO of Hines Global REIT, said in a prepared statement.
“The property has performed extremely well for shareholders, producing solid income and appreciating substantially since its acquisition,” she added. “Accordingly, management and the board determined this to be an opportune time to lock in gains and maximize the return on our investment.”
Hines had purchased the buildings from Fisher Media Services for $160 million in December 2011.
Hines Senior Managing Director Ty Bennion noted in the same statement that the property borders South Lake Union and the Queen Anne Submarket, “an area that has seen significant growth from Amazon, University of Washington, Biotech and other technology users in recent years.”
A JLL Capital Markets team of Managing Director Lori Hill, Conan Lee and Michael Hochanadel marketed the asset for Hines.
“We ran a targeted marketed process specifically to data-center buyers and logical equity sources who invest alongside data-center operators. The interest was strong,” Hill told Commercial Property Executive. Sinclair Communications is the largest tenant, and the local ABC affiliate, KOMO, has both TV and radio broadcasting at the property, she added.
Most of the property’s income derives from the data-center operations, and that portion also has potential upside through expansion of those operations, hence the focus on data-center buyers, Hill explained.