Past no longer stumbling block as Allen project settles warehouse dispute
Seattle Times business reporter
The promotional signs just went up. The dispute over a historic warehouse has been resolved.
Now about all that's holding up billionaire Paul Allen's latest project in the South Lake Union area — a four-building office complex that would fill one block and parts of two others — are the building permits and tenants.
The permits may come easier than tenants in what is the softest office market in a decade. But that's not stopping developers from pushing forward on the Interurban Exchange project. They are counting on the demand for office space to rebound soon.
"We're positioning ourselves to be ready," said Suzi Morris, investment manager for Bellevue-based Schnitzer Northwest, a developer working with Vulcan, Allen's development company. "We're cautiously approaching it."
The project would occupy the block between Harrison and Republican streets and Boren and Terry avenues north and portions of the two blocks immediately west and northwest. It would include the Van Vorst building at 415 Boren Ave. N.
The project was held up two years ago when the developers wanted to raze the long-vacant 1909 warehouse to make way for the new buildings.
Seattle's Landmarks Preservation Board instead declared the Van Vorst building a historic landmark because of its Mission Revival design. The architectural style, imported from California, was used in construction of University Heights Elementary School and the Ballard Firehouse.
The developers came back with a plan to keep the facade and two sides of the brick building; that design has received preliminary approval, said Elizabeth Chave, the preservation board's coordinator.
Now the developers have to get permits and market the complex of four- and five-story buildings that will total 500,000 square feet.
Construction will begin after tenants have signed agreements to lease a substantial amount of the space, Morris said. The permit process is expected to be completed by the end of next month.
Despite the slump in the commercial-real-estate market and plans for another Vulcan office project nearby, the Interurban Exchange has generated a surprising amount of interest, said Jeff Durrell, vice president of Pacific Real Estate Partners, the leasing brokerage.
Two of the buildings will be designed to possibly accommodate biotechnology companies.
The Van Vorst building would be turned into a "tenant-amenity center" that would include a conference room and fitness center, Morris said.
The property on the three blocks is a collection of mostly aging small buildings and parking lots. One of the blocks includes the first project in the neighborhood by Allen: Vulcan and Schnitzer's renovation three years ago of the Rosen Building, which now houses University of Washington researchers.
Vulcan is the biggest property owner in the South Lake Union area, with the equivalent of about 25 city blocks.
Earlier this year it disclosed plans for an office-condo-retail complex at Denny Way and Westlake Avenue, featuring the first supermarket in the neighborhood, and a biomedical building a few blocks north at Westlake Avenue North and Thomas Street. Construction has not begun on either of those projects.
Bill Kossen can be reached at 206-464-2331 or email@example.com.