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1/05/24
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Seattle-based Stream Real Estate purchased Queen Anne Plaza, a four-story, 52.3k sf office building in the heart of Seattle’s central business district, for $7 mil. The 0.33-acre property, which includes two levels of parking, is planned to become Seattle’s first office-to-residential conversion since the pandemic.
The property, located at 201 Queen Anne Ave N, sits across from Climate Pledge Arena, home to NHL’s Seattle Kraken and WNBA’s Seattle Storm, in the city’s Lower Queen Anne (Uptown) neighborhood. It was sold by East West Investment Company Inc.
The official details of the buyer’s new apartment redevelopment have not yet been revealed. According to its website, all of Stream’s properties are LEED® certified and the firm continually strives to go beyond carbon neutral to make a positive and lasting impact.
Cushman & Wakefield’s Dan Chhan, Tim McKay, Sam Wayne, and Matt Kemper represented Stream Real Estate. Andrew Shultz and Brandon Burmeister, also with C&W, repped the seller in the transaction.
“Queen Anne Plaza was an ideal prospect as a multifamily conversion for several factors,” said Managing Director Dan Chhan. “The building is fully vacant, allowing Stream Real Estate to more swiftly execute its transformation plan unencumbered by any existing tenants. The structure's 13k sf floorplates and abundant natural light were also a draw as a multifamily candidate, as were its existing two levels of on-site parking. It also boasts a fantastic “main and main” location near the arena and abundant amenities, while its upper floors also offer great views of Elliott Bay and the Puget Sound.”
“Stream Real Estate has demonstrated a well-thought-out strategy and understanding of the full potential for this property as a multifamily location, factoring key characteristics such as the neighborhood’s walkability, amenities, and more in addition to its aforementioned physical features,” Chhan added.
According to Cushman & Wakefield’s 2023 breakthrough report, Obsolescence Equals Opportunity, the growing trend of remote and hybrid work has driven down demand for office space, leading to shrinking footprints, and in some cases, empty office buildings. The report found by the end of the decade for a glut of obsolete office space to hit the market, 330 msf to be exact. “The sale of Queen Anne Plaza, an outdated office building originally built in 1985, supports the findings from our firm’s report and presented a prime opportunity as a potential conversion site,” said Senior Director Brandon Burmeister.
“The impact of the pandemic on office occupancy and subsequent obsolescence phenomenon has led owners/investors to quickly re-evaluate their office assets and come up with new potential solutions to either attract tenants or for lower-tier assets, to seek alternative uses as permitted by their city zoning/guidelines,” continued Burmeister. “Earlier this year, the City of Seattle proactively sought ideas for residential to office conversions to help create a future vision that fosters a thriving environment. The city has also rezoned some CBD sites to promote more housing.”
According to Cushman & Wakefield’s latest Q3-23 market report, the Seattle CBD reported a vacancy rate of 24.3% across all classes, with 2.18 msf of occupancy losses through the first three quarters of 2023. The Lower Queen Anne/Lake Union office submarket posted a vacancy of 14.7%, the lowest of the four submarkets comprising the CBD.
Lower Queen Anne, also referred to as Uptown, is home to Seattle Center, a 74-acre area originally built for the 1962 World’s Fair. A main attraction of Seattle Center is Climate Pledge Arena. Other main attractions include the Space Needle, Museum of Pop Culture, Chihuly Garden and Glass, Pacific Science Center, Marion Oliver McCaw Hall, and the Seattle Center Monorail, amongst many others.
Home to several prominent Fortune 500 companies, including Amazon, Microsoft, Google, Apple, Meta, Starbucks, Nordstrom, Nintendo, and more, the Puget Sound’s reputation as a tech hub has drawn in companies from around the world wanting to tap into its renowned tech talent pool.
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