There's No Signs of a Bubble in Seattle. Here's Why.
Investors want to buy here, developers want to build here, and Millennials want to live here: that's the Seattle real estate market in 2015. That's why we're excited to present the Seattle State of the Market beginning at 7:30am on Sept. 30 at the Seattle Marriott Waterfront.
Among our speakers will be Holland Development president Tom Parsons, who tells us he believes demand for multifamily will continue to keep pace with supply in the closest urban submarkets, given the continued concentration of jobs in the city center. However, the increasing rents required to build in fringe suburban locations will impact deliveries, and will balance occupancy. As economic returns weaken due to increased costs, new starts there will slow down.
Tom says interest in core real estate in Seattle, and other West Coast gateway markets, has reached unprecedented levels. And that goes for both domestic and international investors. He says it's an opportune time to sell early-cycle developments and return investment capital to partners. Just last month, Singapore-based Mapletree Group, in a JV with Oakwood Worldwide, acquired the 100-unit Hue apartment complex in South Lake Union. Holland originally developed the property at 717 Dexter Ave N, now called Oakwood Seattle South Lake Union, in 2012.
Another speaker will be Talon Private Capital investment director Jeff Rakow, who tells us the Seattle properties that interest him most for investment in the next 12 to 24 months are assets where there's the ability to "create value through active repositioning." These investments can range from capital upgrades to re-tenanting to ground-up development.
Recently Talon paid nearly $39M for the 110k SF Gateway One office building at 11400 SE Eighth St, on the edge of Downtown Bellevue. In that case, the building is occupied by more traditional tenants, such as Prudential Insurance and First American Title. As Talon managing principal Bill Pollard pointed out at one of our events, this is a time of dynamic change in office properties, not just driven by tech companies (though they’re important). Hear more about the future of the city at Bisnow's Seattle State of the Market beginning at 7:30am on Sept. 30 at the Seattle Marriott Waterfront. Sign up here.