The real estate craze in Seattle apparently isn’t limited to just the housing market. Even downtown buildings are being bought for far more than it seems they should be worth.
The thunderstorm of investment in Seattle real estate kept rumbling as a Texas real-estate investment firm paid $23.6 million yesterday for the 12-story First & Stewart Building.
That works out to $260 a square foot for a nondescript, red-brick building that, according to Officespace.com, is about 26 percent vacant.
And this isn’t an isolated example.
On Monday, Goodman Real Estate paid $38 million for the Medical Dental Building, a 1925 terra-cotta building next to Westlake Center.
And last week, the Executive Pacific Plaza Hotel, another historic building at 400 Spring St., was bought for $13.9 million by a partnership of Seattle and Vancouver investors who plan to renovate it into a boutique hotel.
Don Fosseen, a vice president at CB Richard Ellis, says office buildings in 2005 are selling at double the pace of last year — and triple the pace of the year before.
So if this insanity is a bubble, and it does burst (rather than just slowly fizzle), it seems that homeowners won’t be the only ones with the big hurt put on them.
(Tom Boyer, Seattle Times, 08.05.2005)