rss feedReport: Seattle tower sells for $115 million, lower than Harbor Steps $191 million in ’05
Northwestern Mutual reportedly paid $115 million for the Seattle skyscraper popularly known as the WaMu Center to house Russell Investments. Photo source: Copyright Ryan Hadley's flickr photostream
As a measure of just how much prices for downtown Seattle buildings have dropped during this recession, compare these two years and sales numbers in rough terms:
- 2005: $191 million for Harbor Steps, a large apartment complex
- 2009: $115 million for the tower once called the WaMu Center
The top price came from sales papers filed with King County government, which I reported when I covered the transaction.
The Seattle Times reported the bottom sales number, citing documents submitted to the same government.
I point this out not as a definitive economic marker regarding Russell Investments’ recent decision to leave Tacoma in favor of Seattle. The company will move into the former WaMu Center.
The years are different. One is when the market was soaring, the other suffering from one of the worst economic kidney punches in more than 50 years.
And the buildings are not the same: A mixed-use apartment complex with an estimated total of 732,000 square feet vs. a business skyscraper with roughly 900,000 square feet of office space.
When the downtown Seattle real estate market was hot, though, Harbor Steps sold for what many considered to possibly be a record price for residential property – or $261 per square foot.
After the economy imploded last year, sadly erasing Washington Mutual as a national financial player, its building once known as the WaMu Center sold this year for $127 per square foot.
Last year, the property was valued at $347 million, according to the Times.
The $127 amount is similar to an estimate that Kathleen Cooper of The News Tribune in Tacoma reported, citing U.S. Rep. Norm Dicks. That amount was $150 per square foot.
I believe I’m safe making this comparison between the $261 and $127 per square foot numbers: That’s about a 50 percent drop from 2005 to this year.
In other words, Northwestern Mutual – which owns Russell Investments – bought more space at a lower price because of market conditions.
JPMorgan Chase sold the 42-floor tower after receiving it as part of the WaMu takeover, the Times reported.
Bill Condon, who is based in Seattle with Grubb & Ellis, told reporter Eric Pryne: “It’s an incredible opportunity, and they [Northwestern Mutual] capitalized on it.”
In a statement, Russell Investments chief executive Andrew Doman avoided talking about the price:
After a thorough search and analysis of multiple sites in the Puget Sound region, we came to the clear conclusion that this is the right decision to best serve the long-term interests of our business, both from an economic and qualitative standpoint, and particularly given the unique conditions of the commercial real estate market in Seattle.
I want to stress that this is a quick and basic - or back-of-the-envelope - comparison, looking at prices during two years.
I only looked at these numbers because I find them to be fascinating, given different times in the nation’s economy.
In a way, this also looks like it can fit under the idea of a new “American price” during these economic times – meaning, paying less money by a noticeable amount.
NOTE: I forgot to say: For people living outside the Seattle-Tacoma area, Russell is a worldwide company that manages $151 billion in assets, as of late June. In the Tacoma area, it employs about 900 people.
