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Wednesday, January 18, 2006 - Page updated at 12:00 AM

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Microsoft to buy Safeco's Redmond office complex

Seattle Times technology reporter

Microsoft has agreed to buy the Redmond office campus that insurance company Safeco is leaving behind as it consolidates operations at its Seattle headquarters.

The software company agreed last week to buy the office space for $209.5 million, according to regulatory filings. The sale, expected to close in the latter part of the year, doesn't include the lot containing Safeco's data center, however.

Safeco said last April that it was going to expand its headquarters in Seattle's University District and move about 1,300 employees there from Redmond. The company had been mulling whether to consolidate in Redmond or Seattle. Another part of Safeco's Redmond campus cleared out last year after the life insurance and investment group it sold in 2004 moved to Bellevue.

Microsoft already owns a significant chunk of land in Redmond, but plans to expand its footprint further. Microsoft has added about 1,400 jobs in the area every year for the past three years. As of June 30, the end of its fiscal year, the company employed 61,472, including nearly 28,000 in the Puget Sound area.

In a regulatory filing today, Safeco said it reserved the right to cancel the deal before mid-April because uncertainties remain surrounding its planned office project in Seattle. Safeco said it expected a pre-tax gain of $29 million on the sale.

Kim Peterson: 206-464-2360 or kpeterson@seattletimes.com

Copyright © 2006 The Seattle Times Company

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