The CRE strategy remains much as it was
16 months ago.
Fully leased up buildings retain their value, empty buildings lose value. 705 Union Station lost their core tenant, Amazon, and were left with a "see-thru" building. A REIT from SF paid $38mn for it. The previous owner paid
$66mn in 2001. The original price included Amazon as an anchor tenant. Live by the anchor tenant, die by the anchor tenant. CBRE currently has space in 705 listed as "negotiable." Here's 705:
But what about Amazon? They are consolidating near South Lake Union/Denny Triangle area. It just so happens that Scnitzer recently leased 60% of 1918 Eighth to Amazon. Guess what? 1918 Eighth
is up for sale. Of course, a sale won't be a walk in the park since the competition is pretty stiff
with other downtown office buildings recently listed for sale including 36-story 1918 Eighth, 14-story 818 Stewart, 27-story Seattle Tower, the 21-story office tower at Westlake Center, and Regence Blue Shield's 16-story headquarters. Here's 1918:
So the strategy remains the same...get and/or retain tenants. So not much has changed in the last 14 months except CRE prices are down another 13% since then.
No comments:
Post a Comment