New York-based real estate investment manager Clarion Partners has purchased a Seattle office building through a joint venture with a local real estate developer.
The venture between Clarion and Urban Renaissance Group acquired Qwest Plaza at 1600 Seventh Avenue in downtown Seattle from Qwest Corp.’s new parent, CenturyLink. Based on data from Real Capital Analytics, the venture purchased the 531,771-square-foot office property for $137 million. Clarion acquired the building on behalf of a separate account client, the identity of which a Clarion spokeswoman declined to disclose.
Steve Latimer, managing director and portfolio manager at Clarion Partners, told PERE that a renovation of the property is currently planned. “We’re really happy with the systems that CenturyLink took care of, so there’s nothing of substance that needs to be done,” he said. “It’s all cosmetic: modernising the lobby, upgrading the elevators and adding parking.” Urban Renaissance Group will manage the property as well as the renovation process.
CenturyLink, the third largest telecommunications company in the US, acquired Qwest last spring, and Qwest and its predecessor companies have occupied the property since it opened in 1976. CenturyLink will maintain a major presence at 1600 7th Avenue in downtown Seattle. Upon the close of the sale, the company signed a new 10-year lease for approximately 260,000 square feet in the 32-storey office tower.
“Over the past several years, CenturyLink has strategically repositioned itself for opportunities as a leading premier broadband company,” said Brian Stading, Northwest regional president of CenturyLink in a statement. “1600 7th Avenue has been an asset, but it is not fundamental component of our business strategy.”
Meanwhile, Nordstrom is moving into building, leasing more than 300,000 square feet of space. Qwest Plaza is two blocks from Nordstrom’s headquarters and flagship store on 1700 Seventh Ave.
With Nordstrom and CenturyLink in Qwest Plaza, occupancy at the property rises to 88 percent. There are still a few floors in the property that are vacant, but Latimer said that the venture will be focused on refurbishments before leasing out the remainder of the property. ”We’re going to finish the renovation before worrying about the last few floors,” he added.
This transaction marks the second acquisition by Clarion in the Seattle area this year, following its $31 million purchase in January of Covington Esplanade, a Home Depot-anchored shopping centre. The firm now manages more than $1 billion of real estate in the Seattle area.
Additionally, this purchase follows Clarion’s acquisition of two adjoining Boston office buildings for $87.1 million. It was announced in February that the firm acquired 535 and 545 Boylston Street on behalf of an undisclosed separate account client.