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December 3, 1999

Real Estate Buzz

When Kerry Nicholson joined Legacy Partners Residential last May, he said he wanted to shift the company's development focus from the suburbs to the urban cores of Seattle, Bellevue and Portland. He added he was chasing a downtown Seattle site.

That chase has turned into an option on a prime piece of property just a stone's throw from Elliott Bay. Talk began heating up several weeks ago.

Nicholson was hesitant to comment, but the rumor mill kept churning and eventually spit out the specific site, one which Portland developer GSL had tied up. Nicholson, Legacy's senior vice president in charge of Northwest operations, confirmed that the property is bounded by Elliott and Western avenues and Broad and Clay streets, just west of where Intracorp is building a condominium development called the Ellington.

Yes we do have that property under option, Nicholson says. He cautions that nothing has been decided. We're just in the middle of the feasibility period. Legacy officials are talking to contractors about the cost of developing the site. And they're out in the investment community to gauge interest in equity partnerships at that location.

Surely someone will be interested. The land is not only practically on the waterfront, it's across the street from where the Seattle Art Museum plans to develop a sculpture garden. It's a very special block, says Nicholson, who calls it one of the more attractive blocks in the whole Northwest.

Legacy still plans to continue developing in the suburbs. It's working on two such projects in the Puget Sound region. One is The Bluffs, a 180-unit development in Renton, and the other is The Homestaed, a 200-unit job in Bothell.

But Nicholson says the listing of salmon as an endangered species and the trend of tenants seeking city life indicate that urban projects may have more appeal at this time.

As for the Elliott project, it's wait and see. There's not much more to say other than we're studying the options.

Not everyone, of course, is hot to live in the big city. There are some pretty nice suburbs. Take Renton, for instance.

Before you urban snobs start your derisive snorting, consider the deal that Dave Schumacher and Jed Curtis of Columbia Partners recently brokered. Paul Manheim with HAL Realty V, sold an 82-unit apartment called Nautica, 1900 N.E. 48th St., for $8.2 million to Bruce Findlay with International Properties Group LTD.

Even mathematical morons such as I can quickly figure sans calculator that those numbers work out to $100,000 per unit, and that's not a record for Renton. Lexington Heights, a new project at 300 Vuemont Place N.E., recently sold for $107,000 per unit.

But, as Schumacher notes, Carl Pollard, now CEO of Buchan Properties, built Nautica seven years ago. For a building of that age (the price) is unprecedented, says Schumacher, who adds the Nautica's new owner plans to convert it to condos.

He thinks Renton is going to be the next market to take off. The reason reflects off the shoreline. Bellevue is waterfront, Kirkland is waterfront and So is Renton, says Schumacher, who adds that one day the suburb's name will have a new pronunciation fitting of its anticipated status.

Here's how he explains it: If Carmel, Calif., is called Carm-el and that fancy-pants street in Beverly Hills is pronounced Ro-day-o Drive, then the Southend city in question could be called Ren-tawn.

More news from the Southend: Market sources say a healthy portion of Space Center East, the 763,000-square-foot former Boeing office property now called Center Point Corporate Park, is getting leased up. And one of the eight buildings, an 82,000-square-foot, stand-alone tech structure, is about to be sold.

Rumor has it the new owner's marketing representatives from Pacific Real Estate Partners have leases in the works for roughly 100,000 square feet. One rumored tenant is Blue Cross/Blue Shield. A Japanese trading company is said to be the buyer of the building.

Officials at Intracorp, which bought the property from Boeing for $40.6 million and which is investing $30 million into upgrading it, declined to comment.

There's a new marketing team for Hines' 484,000-square-foot 112th @ 12th office project in Bellevue. Rob Hollister of Hines picked John Black, Paul Sweeney and Jason Furr of the Broderick Group.

Bret Jordan was the agent until he left Colliers International to rejoin Raskin & Associates. His departure prompted Hines to put the job up for grabs again. Jordan applied as did some other brokers. He says he doesn't mind losing out to a group led by Black, whom he noted is one of the best.

He adds that when he had the account he was frustrated by brokers who floated rumors that Microsoft had sewn up the space. Marketing space that supposedly has been taken is tough.

Hollister says he picked the Broderick Group because of its success marketing projects such as Sunset Corporate Campus in Bellevue and Millennium Corporate Park, the Redmond center where Microsoft reportedly has taken the final 271,000 square feet.



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