Safeco's decision to consolidate its Seattle headquarters in Safeco Plaza at 1001 Fourth Ave. could be good or bad, depending on your perspective.
Colliers Senior Vice President Dan Dahl said it's great for people who own downtown office buildings but bad for people who want to develop new ones.
Safeco signed an 11-year lease to expand from 17 to 26 stories, going from 284,000 to 504,000 square feet.
That tightens up the office market at a time when vacancy is dropping. A report from Kidder Mathews shows the vacancy rate this quarter fell to 8.8 percent in Seattle.
Kidder Mathews says there are 18 office projects under construction in Seattle, and 12 of them started without any tenants. Kidder Mathews reports there is about 4 million square feet in those 12, and 46 percent of that has been leased. But Safeco's decision to stay put is a big blow.
Safeco wants to create a campus-like environment in a single building, said Glenn Greenberg, a spokesman for Safeco. It will renovate its space, expand the conference center, and add a full-service cafeteria and catering services for meetings and conferences. Work will start by the end of next year and be done by the end of 2018.
Safeco has not chosen an architect and contractor.
In addition to Safeco Plaza, the insurance company has space in an office building at Second and Seneca. It will vacate that space by the end of next year.
Today, Safeco has 1,850 employees and contractors in both buildings. Greenberg said the new space will have room for 2,300 people.
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