Tukwila, WA, Aug. 17, 2016 – BKM Capital
Partners, an institutional fund manager with a niche focus on value-add,
multi-tenant light industrial investments, has acquired the Tukwila Commerce Center, a 27-building
476,765 square-foot multi-tenant light industrial park in the Seattle metro
area, for $45,200,000.
The property, which is
situated in the Kent submarket of Tukwila, Washington, was acquired at a
discount to replacement cost and peak pricing, according to Brian Malliet, CEO and Co-Founder of
BKM Capital Partners.
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| Brian Malliet |
“Kent is the third largest
industrial area in the U.S. and one of the fastest growing markets,” says
Malliet. “Our ability to source and acquire an industrial park of this size at
a significant discount to replacement cost in such a strong, growing market
speaks to the strength of our reputation and investment strategy.
“We are capable of
identifying what an asset can be rather than what it is now, and we recognize
the tremendous value in this asset, and in the overall Kent Valley.”
Malliet explains that the
Kent Valley submarket boasts 97.4 percent industrial occupancy with extremely
high barriers to entry, providing a strong opportunity for long-term demand and
rent growth.
Seattle is home to Boeing
(ranked 27th on the Fortune 500 list), Amazon (ranked 29th on the Fortune 500
list) and Microsoft (ranked 31 on the Fortune 500 list). Boeing currently has a
record high backlog of $489 billion in orders, which equates to more than 7
years of work. Additionally, Apple just announced a search for one million
square feet in the Seattle Metro.
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| Brett Turner |
“Industrial rental rates
are soaring throughout the region based on extremely low vacancy rates, high
barriers to entry and strong demand from prominent warehouse distribution and
manufacturing centers across the country,” says Malliet.
Constructed in 1978 by the
Koll Company, BKM Capital Partners plans to upgrade the Tukwila Commerce Center
through a series of key cosmetic improvements.
Despite its lack of newer
amenities, the asset has historically demonstrated strong tenant retention,
according to Brett Turner, Director
of Acquisitions at BKM Capital Partners, who notes that approximately 31
percent of tenants have occupied the location for over 10 years.
“The asset’s historically
high retention rate further proves the property’s quality location and
functionality,” says Turner. “Using our integrated approach, the BKM team will
optimize and fully reposition the property through a series of capital
improvements, ultimately adding significant value to the property.”
BKM Capital Partners plans
to implement improvements to the interior and exterior of the buildings,
totaling $7.9 million, that will enhance the overall aesthetic and
functionality of the property.
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| Darla Longo |
Planned improvements include creative upgrades
to the paint, landscape, exterior facades, tenant and monument signage and
common areas, among others.
“By implementing these
cosmetic improvements, we will be able to bring current rents up to market
value and further attract quality, long-term tenants,” adds Turner.
The property is located at
601-699 Strander Blvd and 800-1164 Industry Drive in Tukwila, Washington, just
off the intersection of the I-5 and 405 freeways and approximately 13.5 miles
from downtown Seattle.
The seller was represented
by Darla Longo and Brett Hartzell at CBRE. For more
information about this property, visit www.tukwilacommercecenter.com.
For a complete copy of the company’s news release,
please contact:
Lexi Astfalk / Jenn Quader
Brower, Miller & Cole
(949) 955-7940
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