This article originally appeared in the Puget Sound Business Journal and is part of an Uncommon Thinkers Welcome sponsored thought leadership program.
By Laura Newpoff – Contributor
The 800 Fifth Building in downtown Seattle bills itself as “a place where people feel welcomed, valued, and inspired.” It is “where great ideas happen, where genius thrives and focus reigns supreme.”
A LEED Platinum-rated building situated in the heart of Seattle’s Central Business District with a host of other amenities, including easy access to mass transit, made it the ideal place for Tufts University to open a new Doctor of Physical Therapy (DPT) program. The inaugural class will start in the fall of 2024.
While 800 Fifth is a corporate office building, having an educational institution lease 23,000 square feet is a welcome sign amid growing office vacancy rates in the wake of pandemic-inspired remote work.
Tufts’ School of Medicine initially launched the DPT program in Boston, later expanding it to Phoenix and now Seattle. Commercial real estate broker Rick Page, a partner with NAI Puget Sound Properties, represented Tufts in the deal.
“Students will fly in from all over the country to be a part of this program,” Page said. “Once they’re here, they’ll be able to take advantage of all the amenities downtown has to offer — restaurants, hotels, entertainment, museums, libraries and the new waterfront. Tufts is broadening the local pool of talent, because many of these students will choose to stay in the community.”
The deal to bring Tufts to a downtown office building is welcome in the commercial real estate industry in the Greater Seattle region, said Chris McDougall, president and CEO of the Commercial Brokers Association.
“With the office leasing market slowing down with traditional corporate users, education and life sciences are opportunity areas for these spaces,” McDougall said. “Property owners are trying to find the right play and medical education and life sciences are growing and emerging areas where space can be converted to increase occupancy.”
Two signature projects: a revitalized industrial park and a waterfront investment
According to Page, one of the more innovative real estate developments happening in the region is Unico Properties’ transformation of a former horse racing track-turned-business park. In partnership with the city of Renton, it is being revitalized as a mixed-use development. NAI is the company’s listing broker.
Unico purchased the 158-acre Longacres property from Boeing Co. in 2021. It now contains nearly 1 million square feet of commercial space, a daycare facility, central utility plant and 50-plus acres of developable land. The Seattle Sounders FC is building a state-of-the-art training facility and office headquarters there to host its soccer and business ecosystem on one site. Page said a hotel, retail spaces and thousands of residential units also are part of future development plans.
“This is a huge, dynamic project that is revitalizing former Boeing office buildings into a vibrant mixed-use space that will benefit the community of Renton,” Page said. “The practice fields and facilities will be open to the public, giving Renton an economic boost through visitor attraction and surely hosting international teams during the World Cup in 2026.”
The property is ideally situated because it sits next door to a downtown commuter train station and is about a 10-minute drive to Seattle-Tacoma International Airport, he said.
McDougall said another signature project that will contribute to economic growth is Waterfront Seattle. Now that the elevated Alaskan Way Viaduct has been removed, the city is rebuilding the waterfront to connect it to downtown.
The effort, a $781 million, multi-year investment, will last through 2025, just in time for the 2026 FIFA World Cup. It includes construction of a park promenade along the water, building a new surface street and an elevated connection from the Pike Place Market to the waterfront and rebuilding two main piers. East-west connections between downtown and Elliott Bay also will be improved.
“We’re seeing a huge commitment to investing in core infrastructure and the anchors and cultural elements of downtown,” McDougall said. “This is an amazing attraction to connect downtown to the waterfront. It will be pedestrian and family friendly, tourist friendly and will benefit business attraction and retention.”
Life sciences boost
The commercial real estate market also is getting a lift from the Greater Seattle region’s life sciences sector. The city has one of the largest concentrations of research talent in the U.S., according to CBRE.
The CBRE report also ranks the area as the eighth largest life sciences market in the U.S. At the end of the third quarter of 2023, the Puget Sound region was home to 8.5 million square feet of life sciences space, with an additional 1.3 million square feet under construction to deliver within the next 18 months and another 1.5 million planned that could be delivered in the next 3 years. Biotech innovation from the region’s world-class research organizations remains strong, said Marcus Yamamoto, who co-leads CBRE’s Puget Sound Healthcare and Life Science Group,
“The Seattle life science market is at an exciting point in its life cycle. We’ve had tremendous success with new innovative companies growing our ecosystem,” he said. “As a result, many of the new developments and existing facilities around town have filled up over the last couple years, fueling the need for new research facilities.”
Currently under construction is the 197,000-square-foot life sciences project near the Space Needle, in the South Lake Union neighborhood. It will open in 2024. CBRE is the lead advisor for the 222 Fifth project that’s a joint venture between Intercontinental Real Estate Corp. and Lincoln Property Company.
Slated to be completed by early 2025, the project is a key new development in the Seattle Close-In area that will grow the investor-owned market by over 50%. “Seattle is well-positioned with high quality research space located in our core market South Lake Union, near and adjacent to our top research institutions,” Yamamoto said. “When you combine that with the world-class talent in our region and its mission to change the world — it makes for a dynamic and exciting ecosystem.”