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Garden-Style Multifamily Property Near Portland Acquired for $49.5M

27 May 2015, 2:12 pm

By Alex Girda, Associate Editor

A residential community in the proximity of Portland recently traded hands in a deal worth $49.5 million. Aukum Management LLC acquired the multifamily asset from a private investor, free and clear of existing debt. The transaction was arranged by HFF, led by Managing Director Ira Virden and Associate Director Kerry Hughes. HFF carried out the marketing for the Canyon Creek property, as well.

The asset is located at 26310 SW Canyon Creek Road in Wilsonville, Ore., which is roughly 15 miles away from downtown Portland. Canyon Creek occupies 29.76 acres of land, and offers proximity to Interstate 5 and the Westside Express Service commuter rail, the main transportation lines for the area. Canyon Creek residents have access to an amenity package that includes a swimming pool, hot tub, health center, playground, common clubhouse and resident business center. The garden-style community offers 372 units that were 95.7 percent leased at the time of the transaction. Units at the Canyon Creek residential community have an average size of 858 square feet.

Aukum acquired the property as part of its strategy to gather a portfolio of units in value-add apartment opportunities throughout the Western United States. The company is focusing on markets such as Portland, Denver, Salt Lake City and Phoenix. Its portfolio totals around 3,000 units valued at approximately $400 million.

Totem Lake Mall in Kirkland to Undergo $200M Renovation, Expansion

19 May 2015, 1:20 pm

By Alex Girda, Associate Editor

The Totem Lake Mall in Kirkland was recently acquired by a joint venture consisting of CenterCal and PCCP LLC. The Village at Totem Lake LLC purchased the property from Developers Diversified Realty and Coventry Real Estate Advisors for a total of $35.5 million. The new owners are looking to extensively refurbish the asset and expand the amount of space available at Totem Lake. The shopping center will be transformed into a more modern location with new components and new anchor tenants.

Located at 12601 120 Ave. in Kirkland, Wash., Totem Lake Mall currently offers a total of 290,000 square feet of space. The four decade-old property will be redeveloped into a mixed-use center anchored by a grocery and a theater. The property is currently being anchored by Ross, Trader Joe’s, 24 Hour Fitness and My Home Furniture, with the first two already signed on for the new iteration of the asset. Considering the magnitude of the changes planned for the renovation and redevelopment of the mall, it’s no surprise that the investment is estimated at around $200 million.

Thought out in such a way as to provide a “village feel,” the construction process is expected to take around 12 months. The expansion will increase the total amount of space available at Totem Lake Mall to around 650,000 square feet of space.

Berkadia Provides Financing for Affordable, Student Communities in Greater Seattle

12 May 2015, 4:55 am

By Alex Girda, Associate Editor

Berkadia’s local office recently announced that it has arranged financing for two residential communities located in the greater Seattle area. The student housing property and affordable housing property are located in Lynwood and Maple Valley, respectively.

The commercial real estate company originated a total of $15.3 million in financing for the assets, with the funds in both cases being provided through fixed-rate loans. Both deals were handled by Senior Vice President Jeff Stuart.

Working with borrower Investors Capital Group LLC, Berkadia arranged $12.2 million for the Maple Crossing Apartments property in Maple Valley. The affordable housing community was finished in 1993 and totals 172 residential units. The unit mix includes one-, two- and three-bedroom apartments. Currently around 98 percent occupied, the affordable housing community features an amenity package that includes a playground, garages and a fitness center. The financing measure provided for the property is a seven-year, full-term, interest-only loan that features a 3.35 percent interest rate and 65 percent LTV ratio.

The student housing community is located in Lynwood, Wash., approximately 17 miles north of Seattle. Sophie Cort Townhomes is a fully occupied property that offers 14 three- and four-bedroom units. The 2008-built community offers its residents features such as parking and private patios. Berkadia arranged $3.1 million in financing through a 10-year loan at a 3.6 percent interest rate and a 30-year amortization schedule. The funds were sourced on behalf of borrower Butler Development through a national bank.

Microsoft Office Trades Hands as Kilroy Sheds 10 West Coast Assets

5 May 2015, 8:12 pm

By Alex Girda, Associate Editor

Microsoft Corp.’s Redmond, Wash., office was among the substantial portfolio Kilroy Realty Corp. recently offloaded to the tune of $309.2 million. The real estate investment trust sold 10 office properties totaling roughly 1 million square feet of space, with an average occupancy rate of 84 percent.

The funds from the sale will be used to further office development projects on the West Coast, as well as for acquisition opportunities and payment on the company’s line of credit.

The Microsoft office is the only one in the Pacific Northwest; the rest are located in San Diego. The Redmond property sits at 15050 NE 36th St., right in the middle of Microsoft’s campus in the city. The tech giant has been the main tenant at the property since its construction in 1998. Kilroy sold it for around $51.2 million, a profit over its acquisition price of $46 million in November 2010 from the Proctor family. Currently known as Microsoft Building 110, the property offers 122,103 square feet of space and is famous for being the only building not under the ownership of Microsoft.

According to John Kilroy, the REIT’s chairman, president & CEO, “the sales prices in these transactions reflect strong investor demand for well-located, high-quality properties”—certainly evidenced by the increase in the Redmond asset’s price in four-and-a-half years.

Image courtesy of keycenterbellevue.com

New Legislation Allows Uptick in Affordable Housing, Though City Far Behind Current Target

29 Apr 2015, 4:39 am

By Alex Girda, Associate Editor

King County recently passed new legislation regarding affordable housing, paving the way for the addition of nearly 900 units over the next five years. Due to measures taken by the state legislature, the county will now be able to issue workforce-housing bonds worth as much as $45 million. The bonds will be backed by the local hotel tax, and will support homes located within at least a half-mile from a transit station.

The new measure will allow willing developers to borrow money from the fund until they can obtain construction financing for their projects. Money will also be available for affordable housing preservation projects. The measure will increase by nine percent the amount of King County housing for households earning from $18,000 to $60,000 per year.

The supply of affordable housing in King County has diminished due to the market’s increased appeal to investors. According to The Seattle Times, with new investors pushing into the Seattle market in recent years, unit rent rates have increased to match the rapid growth of prices in the Puget Sound area, effectively making them inaccessible to those categorized as working-poor.

Mayor Ed Murray

With the current average rent for a one-bedroom apartment in King County at $1,266 per month, the Seattle Housing Authority’s housing voucher lottery program is also feeling pressure. More than 19,000 people have registered for the chance to get one of the 2,500 Section 8 housing vouchers. These vouchers allow those making less than the average income to lease units in privately owned housing in Seattle.

Mayor Murray recently directed the Housing Affordability and Livability Advisory Committee to meet a goal of adding 50,000 new housing units in Seattle over the coming decade. Of those, 20,000 must be income-restricted affordable residences for individuals and families earning less than 80 percent of the AMI. The current income-restricted housing pipeline ensures around 700 units per year, far from the goal drawn out by Mayor Murray.

Image courtesy of seattle.gov

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