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| Rendering of Seattle Design Center, Seattle, WA |
Seattle, WA (Jan. 9, 2017) - Leading
investment banking firm George Smith Partners has secured a $73 million non-recourse
bridge loan for the conversion, renovation and stabilization of the Seattle Design Center on behalf of
Greenbridge Investment Partners, a full-service commercial real estate
firm. The financing was arranged by
George Smith Partners Principal Steve Bram.
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| Steve Bram |
“Seattle’s creative office
market is flourishing, and shows no signs of slowing in the near future,” says
Bram. “Vacancy rates have reached
pre-recession lows, and tech giants such as Amazon and Facebook are expanding
in the market. This activity fuels a
deeper demand for creative office, and presents an opportunity for owners who
are in a position to deliver creative space to the market.”
The design center,
comprised of two buildings situated in the Georgetown submarket of Seattle,
historically served as a well-known destination for high-end home furnishings
and design services. Since acquiring the
property in 2014, Greenbridge Investment Partners rebranded the buildings into:
Building 1: a 157,000
square-foot asset now called Seattle Design Center
Building 2: a 280,000
square-foot asset now called Georgetown Squared (G2)
“While our client had
purchased the two adjacent design center buildings for $24.9 million at
43-percent overall occupancy, over the last two years, Greenbridge renovated
the Seattle Design Center building and consolidated the showroom/design tenants
into that facility,” explains Bram.
“Now, Greenbridge is ready to begin a major repositioning of the G2
building from showroom space into creative office.”
Bram notes that the challenge
in this transaction was identifying a lender that could refinance the existing
loan to support this major conversion.
“There were two key
obstacles to overcome,” he says. “First,
the existing lender was unable to increase the size of the lending facility. Second, the sponsor had greatly increased the
scope of the renovation plan in order to meet the need for high-end creative
office. By demonstrating the shortage of creative office product in the market,
as well as the strong demand for this product type, the George Smith Partners
team identified a lender who recognized the value in the project and funded the
loan.”
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| Sean Hashem |
The $73 million
non-recourse bridge loan closed at 59.7-percent loan-to-stabilized value at a
competitive LIBOR spread for a 24-month term with one 12-month option.
$49 million was funded at closing, and an
additional $24 million will pay for renovation, construction, tenant
improvements and leasing commissions at the G2 building.
Sean Hashem,
Principal of Greenbridge Investment Partners explains, “This is a major success
story for our firm. We recognized that
demand was not sufficient to operate both buildings as a home furnishing and
design center, and we understood the need for creative office space in the
marketplace.
“By implementing our
re-tenanting and repositioning strategy, we have brought the Seattle Design
Center building to 86-percent occupancy, and our G2 building is already
45-percent pre-leased to strong tenants.”
Greenbridge’s G2 office
building will offer a full creative environment with expansive 60,000
square-foot floorplates, exposed ceilings and concrete floors, glass walls for
natural light, unobstructed views of downtown Seattle and Mt. Rainier, and
full-service amenities, including an upscale fitness center and conference
center.
The property is located at
5601 & 5701 Sixth Avenue in Seattle, Washington, in close proximity to
major traffic routes. More information
on G2 is available at www.georgetownsquared.com.
For a complete copy of the company’s news release,
please contact:
Miki Conant / Jenn Quader
Brower, Miller & Cole
(949) 955-7940
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