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April 19, 2016

The unexpected place in Seattle where 30-story office towers could rise

Puget Sound Business Journal

Marc Stiles

The rows of low-income housing across the street from Harborview Medical Center in Seattle is where few people would expect high-rise office buildings to be built.

Developers, however, have been circling the site that is for sale on east side of Interstate 5, though none has bought it yet. Now, the Seattle Housing Authority (SHA) has sweetened the opportunity by agreeing to let whoever buys the property build a total of up to 350 multifamily housing units on the site. This is in addition to 1 million square feet of commercial space that SHA has been trying to entice developers to build there.

"It makes it more attractive," said Stan Snow of commercial real estate company Kidder Mathews. He is leading the team that is marketing for sale the 4.4-acre development site at Ninth Avenue and Alder Street. "We're trying to drive additional interest."

Today, 13 low-rise apartment buildings occupy the property. These buildings are among the last vestiges of the old Yesler Terrace, a World War II-era public housing project that covers 30 acres. The 561 apartments of ultra low-income apartments throughout Yesler Terrace are being replaced and will become part of a mixed-income neighborhood with up to 5,000 residences and office buildings at Ninth Avenue and Alder Street up to 300 feet tall.

Some new apartment buildings already have been built along with a hillclimb that connects Yesler Terrace to the Chinatown-International District.

The commercial development site across from Harborview will be among the biggest changes, bringing new businesses and thousands of jobs to Yesler Terrace. In the old Yesler Terrace, the only businesses were around two-dozen in-home daycare centers.

"All of our efforts to date have been about transforming a community, a community that was a pocket of poverty," said SHA Executive Director Andrew Lofton. The average annual income at Yesler Terrace is $16,550.

In the vision for the new Yesler Terrace, techies, doctors, lawyers and accountants would augment the daycare providers along with restaurateurs and retail shop clerks.

Kidder Mathews started the marketing the Ninth and Alder property about two years ago. "We've come close on a number of deals. We just have not found the right fit yet," Snow said.

Interested parties are local, national and international developers.

Most companies prefer to be in downtown Seattle and South Lake Union, and to help get potential developers and office tenants interested in Yesler Terrace, SHA got the city to custom zone the property to expedite permitting. Kidder Mathews touts this along with other factors, such as the site's freeway visibility and the size of the property.

"There aren't a lot of places in town where you can put up 900,000 square feet of office," Snow said.

For the full story, go to Puget Sound Business Journal.

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