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Real Estate Buzz


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October 1, 1999

Real Estate Buzz

The Touchstone Corp., in conjunction with Orix Real Estate Equities, will break ground Thursday on Northgate North, an $80 million retail center to be anchored by Target and Pacific Northwest newcomer Best Buy, an electronics superstore that also sells compact discs and digital video disc movies over the Internet. That more retail space is being built in the bustling commercial neighborhood is not surprising. It is the project's land mass, or lack thereof, that merits mention.

Touchstone was able to overcome high land prices by squeezing the 324,000-square-foot building onto just four acres. Touchstone President Douglas Howe says building a retail center that size in a conventional setting would take 32 acres.

He calls Northgate North "a suburban Pacific Place" and says only a handful of similar developments are going up across the country. "We were able to find half a dozen around the country that are similar, but it's not exactly the same. We really had to invent it ourselves."

The property at 300 N.E. Northgate Way allowed no vehicle access off Northeast Northgate Way nor Fifth Avenue Northeast. So Touchstone officials worked with King County and Seattle officials to create a new street: Northeast 112th.

The steel-framed building will sit on a sloped site and have above-and below-grade parking. An eight-story concrete parking garage will be connected to the retail space by plazas and pedestrian bridges in the center of the project.

Target is taking two of the four levels and Best Buy is taking one level. Howe said leasing the rest of the space is in progress.

Watch for a rendering of the project and other details in the DJC next week.

There's a rumor that Vulcan Northwest, billionaire Paul Allen's asset management company, will be neighbors with WatchGuard Technologies in Vulcan's new headquarters: 505 Union Station. Vulcan is taking the top four floors for its headquarters and leasing out the other seven. So far no tenants have been announced.

WatchGuard is a 3-year-old Seattle company that provides Internet security. One commercial real estate expert, who has a front-row view of Seattle's frenetic leasing dramas, says the company will call 505 Union Station home.

WatchGuard, which now has its offices in Seattle's Pioneer Square, had a letter of intent for 60,000 to 80,000 square feet of space in another Union Station building: Six Union Station, the 10-story office project that J.P. Mahoney & Co., wants to build. Developer Pat Mahoney said a couple weeks ago that he and WatchGuard officials agreed to call off the deal when negotiations became too protracted.

WatchGuard officials are saying nothing. A call to the company's media relations department went unreturned.

It was noted recently in the DJC that Seattle-based Northwest Building LLC, a subsidiary of Matthew G. Norton Co., sold Lakewood Colonial Center in Pierce County to another Puget Sound-area company: Gramor Development of Lynnwood. The 199,576-square-foot center went for $14 million.

Due to space constraints a few of the more interesting facts were omitted. Chief among them were that former Weyerhaeuser Chairman Norton Clapp developed the first building in the center in 1937. And No. 2: The International Council of Shopping Centers has recognized Lakewood Colonial Center as one of the first developed centers west of the Mississippi River. A press release from Northwest Building says it is the second oldest shopping center in the country.

Northwest Building Managing Director Wayne Reisenauer says the sale marks the end of its history in the retail property management business. "Over the years our business focus has turned to industrial and office development, with projects like the 170-acre Lakewood Industrial Park and the Puyallup Industrial Park. Therefore, we slowly have sold off our original 10 shopping centers to those who specialize in the retail real estate market."

Jekyll & Hyde is probably not the sort of neighbor Nordstrom officials had in mind, but it's who they're getting in Chicago.

Jekyll & Hyde, states a press release, is a "spooky themed restaurant venue" and is the sort of "destination restaurant-entertainment venue that is in highest demand these days." It has signed up for 27,000 square feet in the North Bridge project just off Michigan Avenue. The project includes the Nordstrom redevelopment.

Pardon our Northwest sensibilities, but this seems downright weird. Maybe we're just that unhip. The North Bridge location will be J & H's first venue outside Manhattan, where according to the press release, it is "a proven hit." Patrons are attracted to the restaurants that are designed around the characters in the novel by Robert Louis Stevenson.

Sounds like a great place Ï for a Halloween party. Maybe we just need some time on this one.

We're hearing some sniveling from up the street at Brand X. The very fine folks at the weekly Puget Sound Business Journal, it seems, are all mopey because they'll soon lose their Elliott Bay view now that Millennium Tower at Second and Columbia is going up.

We who labor by the entrance to the Alaskan Way Viaduct say boo-hoo to that. Views, shmiews.



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