June 16, 2025

Taking a loss on First Hill, Vanbarton sells the Danforth for $173M

Kennedy Wilson and Japanese partners got the 7-year-old building at a surprising discount. Photo via Kennedy Wilson [enlarge]

Late last year, Eastdil Secured began shopping the 265-unit Danforth apartments on behalf of owner Vanbarton Group. The latter had acquired the new 16-story building, at 1425 Spring St. on First Hill , from original developer Columbia Pacific Advisors in December of 2019. It then paid a little over $209.2 million, about a year after the apartments opened.

Kennedy Wilson announced last week that it paid $173 million for the luxury apartments, with the Whole Foods grocery store below. King County recorded the deal early Friday, with a relatively small $1.2 million personal property deduction off the topline price. Including the retail, the deal was worth about $661 per square foot.

Kennedy Wilson's William McMorrow said in a statement, “The Danforth provides an opportunity to acquire a recently built community at a discount to replacement cost within an area experiencing limited new construction and strong absorption due to recent return-to-office initiatives from leading technology employers.”

The sale represents a roughly 17% loss for Vanbarton, which is based in New York, after only six-odd years of ownership. The figure is even greater than the discount predicted by Real Estate Alert, which first reported that the Danforth was on the market.

Kennedy Wilson is based in Los Angeles, and a regular in our market. It acquired the Danforth with Japanese investment firms Kenedix and Hulic. KW says it has a 10% stake in the joint venture, representing about $6.6 million in equity. There's no sign of a loan.

Hikaru Teramoto of Kenedix said, “We appreciate the opportunity to participate in this joint investment. With continued population growth and the potential for attractive returns, we are strengthening our initiatives in the U.S. real estate market.”

Among its investment criteria, Kennedy Wilson cites the Danforth's central location: “adjacent to the city's best restaurants, nightlife and largest employers. It is also positioned within Seattle's largest hospital network, with a $1.3 billion expansion project set for completion by 2027.”

That refers to the nearby North Tower at the Providence Swedish campus, which topped out this month. The expansion, says KW, will help support “a highly educated and well-compensated resident base.”

Kennedy Wilson now has about 13,000 units in our region. Last year, notably, it acquired the 226-unit Axle in Interbay, and the 400-unit Onyx in Redmond. It also invests in the office and industrial sectors. The publicly traded and international company has about $29 billion in assets under management. It's also a developer.

The new ownership didn't mention any brokers on its side of the deal. Greystar is still listed as the property manager on the Danforth website. Units range from one- to three-beds; rents aren't detailed on the website.

Kennedy Wilson lists amenities including a Studio Fit fitness center, rooftop solarium and dog run, resident lounge with shuffleboard and media center, a full demonstration kitchen, and barbecue patio with multiple grills.

The Danforth, on the corner of Broadway and Madison, has 354 underground parking stalls. It's about a 15-minute walk north to Capitol Hill Station. And the First Hill streetcar line runs directly in front of the building.

Vanbarton isn't exiting our market. It still owns the Bank of California building in downtown Seattle, and Millennium Corporate Park in Redmond. The Danforth sale represents a retreat, here at least, from the multifamily arena.