Tech companies have long had an appetite for office space in Bellevue, and the demand has accelerated. But that doesn't mean that supply is going to catch up.
Rents in Bellevue skyline buildings (Class-A and a few others) average $38/SF, up 7.8% in the past 12 months, according to JLL managing director Steve Schwartz. But hetells us that the Bellevue office markets high barriers to entry are going to continue.The first is the process itself, which is quite stringent. Thatisn'tunique to Bellevue, and it wont entirely dissuade projects, but it still isn't easy to get projects off the drawing board.
A more important office market regulator, Steve says, is that the marketisn'tas deep as Seattle, which hinders spec options. The smaller companies that tend to dominate this market don't usually plan their space needs two or three years out... so it's hard for a developer to go through the lengthy design process and have an anchor tenant in hand to take 25% to 30% of the space, he explains. (Techies will stand in line at Comic-Con for a year, but plan their real estate while they do it... no, sir.)
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