June 4, 2018

Blackstone sells 5th & Bell for $95M

Less than two years ago, Blackstone acquired the 5th & Bell Building for almost $93 million, as part of a larger portfolio sale from Hines. Now the building has sold again for almost $95 million to Alexandria Real Estate Equities.

Both parties used LLCs in the transaction; no brokers were announced.

The deal was worth about $482 per square foot.

The six-story 5th & Bell — also called the Amazon Otter Building for its largest tenant — occupies the half-block site at 2301 Fifth Ave., between Battery and Bell streets. It was developed in 2002 by Touchstone, with about 197,000 rentable square feet and street-level retail. There are 209 underground parking stalls.

CollinsWoerman was the architect.

Amazon signed its last lease in 2014, with a 10-year term and another 10 years in renewal options. In 2013, The Seattle Times said Amazon would take about 100,000 square feet at 5th & Bell. Other office tenants include Zipcar, Phillips Design and the University of Washington. Tenants in the retail space are unknown.

Colliers’ first-quarter report, released in April, said 5th & Bell would go on the market, along with three other Amazon-leased projects: 202 Westlake (aka Amazon Roxanne), which sold in May for almost $130 million; the Troy Blocks (aka Houdini North and South); and 300 Pine (aka Macy’s), which is still under construction. 5th & Bell is different from those three in that it’s only about half-leased to Amazon.

Amazon currently leases about 6 million square feet in Seattle, and owns about 3.6 million square feet. With projects in the pipeline, its local footprint — including Bellevue — could reach about 14 million square feet in four years.

However, Amazon is expected to announce its HQ2 decision this year, indicating what city will accommodate much of its planned future growth — which could total 8 million square feet.

For now, Amazon is proceeding with Block 18 on land it owns in the Denny Triangle, with about 405,000 square feet of offices. Whether Amazon will occupy or sublease the 722,000 square feet of offices at Rainier Square, now under construction, is still unknown.

Meanwhile, signatures are being gathered for a referendum to repeal the city’s $275 head tax on large employers including Amazon. That measure needs 17,632 approved signatures to qualify for the November election. The signature tally will be approved this month.

Publicly traded Alexandria is based in Pasadena, and now has about 1 million rentable square feet in Seattle. Its seven buildings, clustered in South Lake Union and Eastlake, are mostly leased to life-science and biotech companies.

Alexandria is currently developing a new speculative building at 1818 Fairview Ave. E., with 205,000 square feet of offices.