May 5, 2025

A bit more about that $193M Soma Towers sale, the largest of the year

Photo by Porchlight Photography [enlarge]

The two-tower complex, with many restaurants, is a short walk to the coming light-rail station.

CBRE announced after deadline last Thursday that it had brokered this year's biggest property sale to date.

As the DJC reported briefly on Friday, Su Development sold its two-tower, 273-unit luxury apartment complex at 258-288 106th Ave. N.E. in downtown Bellevue for just under $192.9 million.

CBRE's Eli Hanacek, Kyle Yamamoto and Mark Washington represented Su in the two-part transaction. Including commercial space, it was worth somewhere around $875 per square foot.

In a 1031 exchange deal, the de facto buyer was the Sobrato Organization of San Francisco. Like the seller, it's a family-run enterprise. It's new to Bellevue, but has other investments in our region. (Those all came before the Great Recession.)

Sobrato's Chad Froman said in a statement, “For nearly 70 years, the Sobrato Organization has been developing commercial real estate for high-growth companies, building multifamily communities [and] investing in entrepreneurial enterprises. Soma Towers is directly aligned with our objective of making a positive impact by providing a high-quality living experience and a place that engages the broader community through its retail lifestyle offerings.”

CBRE's Hanacek added, “Our valued client had a tight timing window to make this deal happen, we're thrilled we could execute for them, going from launch to non-refundable within 60 days. The property garnered significant interest from buyers because of the exceptional quality of the asset, strength of the market and long-term fundamentals.”

Soma has 29,964 square feet of commercial space that's 90% leased, says CBRE. There are a half dozen restaurants and a gym, numerous amenities and about 378 parking stalls, above and below grade. Add in the parking, and the whole complex spans about 432,000 square feet.

Sobrato

In the Bay Area, Sobrato is a big name. Billionaire John A. Sobrato started in single-family home sales in the late 1950s, while still in college. Over following decades, he developed scores of homes and commercial buildings in and around Silicon Valley. Amazon, Facebook/Meta and Apple have been among its past clients.

Sobrato Real Estate says it has, since the 1960s, developed nearly 21.5 million square feet of R&D and office buildings and apartments (the latter totaling around 10,000 units). The privately held company is now in its third generation of family leadership.

In recent years, Sobrato has become a major philanthropist in California. The Sobrato Family Foundation announced last year that it was leasing a 75-unit tiny house site in San Jose — one of the most expensive housing markets in the nation — for $1 per year for the next decade. Two years ago, it simply purchased a 61-unit complex in Hayward for $17 million, to preserve affordable housing.

MOMENTUM FOR SU

For the seller and original developer, Su, the windfall rewards a bet made just before the Great Recession hit. The $12 million in land sales came in 2007; construction was then delayed about seven years, and the phased project was fully open by 2017. The development, on the corner of Northeast Second Street, replaced Koi's Chinese restaurant, a parking lot and small office building.

The record-setting sum also reflects the premium for a walkable downtown location that's about an 11-minute trek east to Bellevue Downtown Station. Light-rail service there should finally connect to Seattle this winter.

The cash haul also ensures the completion of Su's Yesler Towers project, where the second of two towers is now rising at Yesler Terrace. (Those will eventually have 358 units, plus retail.) Both those projects were designed by Bohlin Cywinski Jackson and built by Su.

And the payout gives the developer momentum to buy and redevelop the vacant former Sushi Maru site in downtown Bellevue. Su is working with MZA Architecture on that 28-story, 173-unit plan.