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January 24, 2021
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Hudson Pacific Properties and Canada Pension Plan Investment Board Buy Seattle Office Tower in $625 Mil Deal


Hudson Pacific Properties and Canada Pension Plan Investment Board have partnered in a large, end-of-year office buy, paying $625 mil for 1918 Eighth Avenue, a 668.9k sf high-rise located in the heart of Downtown Seattle’s burgeoning South Lake Union/Denny Triangle submarket. The asset was sold by institutional investors advised by J.P. Morgan Asset Management in a deal that works out to $934/sf.

Built in 2010, the LEED-Platinum certified, 36-story property features 6.7k sf of ground-floor retail space, a central conferencing facility, a 4ksf exclusive fitness center, a “Great Room” lobby design, sweeping skyline views and outdoor patio space. The property is ideally located within two blocks of light rail, streetcar service and dozens of bus lines. 1918 Eighth Avenue also enjoys tremendous access to Seattle’s “Retail Core” and is in proximity to a variety of hotels and urban residential options.

Newmark’s Co-Head of Capital Markets Kevin Shannon, Vice Chairman and Divisional Head of International Capital Markets Alex Foshay and Executive Managing Directors Ken White and Rob Hannan, in cooperation with Vice Chairman Nick Kucha, represented the seller in the transaction. Newmark’s Vice Chairman David Milestone and Senior Managing Director Brett Green procured new financing for the buyer.

“Since the onset of the pandemic, Seattle has emerged as one of the top performing office markets in the nation,” said Shannon. “The fundamentals are clearly healthier and the recovery of office using jobs since the second quarter is far stronger than any other major market nationally which is contributing to the resilience of its fourth-quarter sales velocity.”

According to Newmark Research, the South Lake Union/Denny Triangle submarket has seen 4.9 million square feet of positive net absorption since 2015, dropping the direct vacancy rate by 600 basis points to three percent—as of the third-quarter—while witnessing a 40 percent appreciation in average rental rates. The submarket’s recent performance is particularly impressive given the 5.4 million square feet of new office inventory delivered during the same period. Those deliveries increased the rentable inventory by nearly 45 percent, making South Lake Union/Denny Triangle the fastest growing submarket in the region over the past five years.

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