Premier Flex Park for Sale in Seattle's East Side

Thursday, August 10, 2017

Update: HFF announced the closing of this sale in December 2017. To view HFF's current commercial real estate listings, please click here.

Holliday Fenoglio Fowler, L.P., (HFF), on behalf of the owner, is marketing North Creek Parkway Center, a premier six-building flex park located within the North Creek micro market in Bothell, Washington, for sale. Over the past three years, ownership has invested $2.6 million in base building capital and $5.1 million in tenant improvements, returning over-improved office suites to their original flex configurations and making North Creek Parkway Center a highly functional multi-tenant flex park with a perfect mix of office, warehouse and lab space. The property attracts and retains more tenants than competing properties because it represents a segment of the market with no new inventory. Simultaneously, flexible spaces cost less to retenant. Reduced tenant improvement costs, combined with above market tenant retention, allow investors to benefit from durable, protected cash flow year over year.

The flex office property for sale comprises 148,616 square feet of office space, 22,720 square feet of warehouse space and 33,962 square feet of laboratory space that is 97 percent leased. Offering space that uniquely meets tenant needs, North Creek Parkway Center outperforms the competition. The property’s flexible spaces cost less to retenant, as stated above, while the park itself benefits from above average tenant retention and absorption, due to its location in the supply constrained North Creek micro market, with a direct vacancy rate of 5.1 percent. Almost half of North Creek Parkway Center’s tenants have leased space in the park for more than 10 years, including anchor Alder Biopharmaceuticals, a leader in migraine prevention drug technology.

Located at 11804-18916 North Creek Parkway, the commercial real estate listing is in the Seattle suburb of Bothell, where demographic shifts drive demand. Seattle’s elevation to a top-tier market has enhanced the demographics of Bothell, demonstrated by a 20 percent growth in households since 2000 and a 12.8 percent year-over-year increase in home values. Future growth throughout the Seattle MSA will continue to benefit Bothell and ensure North Creek Parkway Center’s long-term success.

Flex Office Park for Sale Investment Highlights

  • Potential Credit Enhancement Through Alder Biopharmaceuticals:  North Creek Parkway Center is anchored by Alder Biopharmaceuticals (34 percent of rentable square feet). If the company’s leading drug, which is in the final stage of development with the FDA, is approved, Alder could be the leader in a $2 billion market for chronic and severe episodic migraine treatment.
  • Market-to-Market Upside:  The commercial property for sale’s in-place rent is below market, at $16.01 triple net lease (NNN) in a market achieving high teens to low twenties NNN, giving investors significant upside on an annual basis as tenants rollover. With 21 percent rolling in year one, investors have the immediate opportunity to raise rents to market prices.
  • Supply-Constrained, Multi-Tenant Flex Micro Market:   No new product has been delivered to the Bothell flex market since 2000. Since 2015, North Creek Parkway Center’s competitive set has experienced a 20 percent increase in asking rents, while vacancy has remained below seven percent.
  • Discount to Replacement Cost:  North Creek Parkway Center provides the opportunity to acquire premium flex space significantly below replacement cost. With new construction costs in Bothell requiring rents close to $27 NNN, North Creek Parkway Center has the advantage.

North Creek Parkway Center provides an opportunity for investors to acquire a premier flex office and industrial business park in the Seattle-area community of Bothell. For more information on this flex office park for sale or other Seattle properties for sale, please contact Nick Kucha, Michael Leggett or Dave Otis. To learn about financing options, contact Tom Wilson. Click here for our real estate investment sales search page.

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