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December 08, 2016

UVI Preps for Mixed-Use Redevelopment Project in Seattle

Commercial Property Executive

Barbra Murray

Urban Villages Inc. plans to transform three buildings in the city's re-emerging Pioneer Square neighborhood.

Seattle-Something old, something new. Urban Villages Inc. plans to transform three buildings from a bygone era into a mixed-use destination in Seattle's re-emerging Pioneer Square neighborhood. But this won't be your traditional redevelopment; UVI and partner Manchester Capital Management will create a lively new community while maintaining the historic character of the nearly 200,000-square-foot group of buildings and their alleyway location.

"Pioneer Square was Seattle's first neighborhood and remains one of its most historically significant places," Leslie Smith, director of The Alliance for Pioneer Square, said in a prepared statement. "The multimillion-dollar investment in this section of Pioneer Square reinforces our goal of restoring this incredible neighborhood by driving urban revitalization and responsible, place-based development."

King County property records indicate that UVI and partner began laying the groundwork for the Pioneer Square project in 2010 with the $10.3 million acquisition of the 73,300-square-foot Westland Building at 100 S. King St. In 2014, they snapped up the Manufacturer's Building, a 99,400-square-foot property at 419 Occidental Ave., in a $17.5 million transaction. And completing the collection is the 21,600-square-foot former Schoenfeld Furniture building at 115 S. Jackson St., which the partners just purchased in November for $5 million.

SHED Architecture & Design will spearhead the historic preservation efforts at the buildings, which were originally developed between 1900 and 1907. The design will exclude any significant changes to the structures' square footage, according to UVI, but it will include an undisclosed number of residential units, premier office space and coveted retail offerings-all conceived to bring new life to a corridor of alleys built more than 100 years ago. Each segment of the live-work-play development will likely find a receptive audience. The average apartment vacancy rate in the Seattle area is just 3.5 percent, per a third quarter report by commercial real estate services firm Kidder Mathews, and in the city's office market, the average vacancy rate is 7 percent and still dropping. However it's the retail that will take center stage at the Pioneer Square project.

"Like many former industrial, urban neighborhoods across the country, Pioneer Square is in the midst of a major resurgence, and while the office and new residential spaces have adapted to meet those changes, retail has not kept pace," Jesse Bank, development associate with Urban Villages, told Commercial Property Executive. "New projects in the Pioneer Square neighborhood like the North Lot and the Weyerhaeuser HQ have brought a different mix of people-at different times of day-and there simply isn't the retail mix in place to serve the whole community. There is strong desire in the market for smaller, more diverse, more affordable retail space that addresses a variety of use types, from soft goods, to services, to food and beverage."

UVI and Manchester have tapped Sellen Construction to serve as general contractor for the Pioneer Square endeavor. Work is on track to get underway in late 2017 and reach completion by 2019.

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