Industrial Edition | Q2 2019
The 2nd quarter of 2019 saw a drastic increase of industrial sales from the first quarter-—three. That brings the grand total on industrial properties sold in 2019 to…three. The bad news for buyers is it is nearly impossible to find a warehouse in north Seattle to purchase. If you are looking to sell, you should feel pretty darn good as prices are at a historic high. The first half of last year saw five industrial sales, so transaction volume is down a bit this year.
One of the sales was of the former Pacific Northwest Ballet warehouse at 3535 Interlake Ave. The 20,140 SF warehouse was purchased for $6M, ($298/SF). The property was purchased by an entity related to Evolution Projects, a very active group in the Wallingford & Fremont area. One of the partners in the LLC is associated with the Seattle Bouldering Project off of Rainier Ave. in South Seattle. The Seattle Bouldering Project is planning to open a 2nd location here. The property located at 5450-5456 Shilshole Ave NW was sold for $1,250,000 ($461/SF). That 2,710 SF property was purchased by the owner of Cloudburst Brewing. He plans to open a new Cloudburst Brewery in the property before the end of the year. In another owner/user purchase, Superior Auto Service purchased the warehouse they occupy at 4333 Leary Way NW for $2,199,000 ($253/SF). They plan to continue to occupy the property.
In terms on non-industrial sales for the first half of the year, here were some of the notable transactions: 920 – 942 Elliott Ave W was sold to S.E. Grainger Development for $3,570,000 ($185/SF). The seller was Beyond Home. The property was on the market for quite some time before it finally closed. It is an extremely specialized building built out for video and sound editing. The new owner is planning to redevelop at some point, but for now just hold as an investment. The Western Fire & Safety Building located at 2446 NW Market Street was sold for $1,750,000 ($535/SF). The property was purchased from Western Fire & Safety by the neighbor. The mixed-use building on the corner of NW Market and 20th Ave NW, was sold to a local investor for $5,073,800 ($413/SF), at a 4.55% cap rate. The property contains 12 residential units above 4,750 SF of retail.
From a growth standpoint, Seattle continues to be the envy of other cities around the country.
Apple recently announced they would be leasing an entire brand-new building in South Lake Union, bringing an additional 2,000+ jobs to the area. Salesforce also purchased Tableau for $15.7B and plans to make Seattle their “HQ2,” to borrow Amazon’s moniker. High wage workers continue to flock to the region, as we saw total non-farm employment growth for May show the Seattle metro area add nearly 17,000 jobs for the month, up from approximately 12,000 in April. Banks are beginning to pull back on their lending slightly, depending on the type of product. Rates, however, continue to hover in the low 4’s, which is necessary at the prices we are seeing in the market.
In terms of non-industrial sales for the first half of the year, here were some of the notable transactions: 920 – 942 Elliott Ave W was sold to S.E. Grainger Development for $3,570,000 ($185/SF). The seller was Beyond Home. The property was on the market for quite some time before it finally closed. It is an extremely specialized building built-out for video and sound editing. The new owner is planning to redevelop at some point, but for now will just hold as an investment. The Western Fire & Safety Building located at 2446 NW Market Street was sold for $1,750,000 ($535/SF). The property was purchased from Western Fire & Safety by the neighbor. The mixed-use building on the corner of NW Market and 20th Avenue NW was sold to a local investor for $5,073,800 ($413/SF), at a 4.55% cap rate. The property contains 12 residential units above 4,750 square feet of retail.
