Vulcan Real Estate sold the two-block, four building Google campus overlooking Seattle’s Lake Union for $802 million, a price of $1,260 per square foot that’s believed to set a new record for the city’s office market.
The sale to German investment firm Deka Immobilien reflects the unique nature of the property and the tenant, and confidence in the tech office market as the COVID-19 Omicron variant wanes. Google said this week that it’s relaxing its COVID restrictions, reinstituting perks, and preparing to bring workers back to the office at least three days a week.
Vulcan, the holding company for late Microsoft co-founder Paul Allen, announced the sale Wednesday afternoon with Newmark Group Inc., which marketed the property, known as Lakefront Blocks, and brokered the sale. The two blocks were marketed separately, they said, and Deka Immobilien was the winning bidder for each.
“The strong interest we received in the property is testament to the enduring quality of this institutional-grade investment,” said Ada Healy, Vulcan’s chief real estate officer, in a statement, calling the property “truly one of South Lake Union’s trophy assets.
The complex spans two city blocks, each of which has two six-story office buildings. The total square footage is 635,000 square feet. The campus is on the northern edge of the South Lake Union neighborhood, between the water and Amazon’s South Lake Union campus, which was also developed by Vulcan.
The sale did not include the two apartment towers above the office buildings.
Lori Mason Curran, Vulcan real estate investment strategy director, said via phone Thursday morning that the prior Seattle office record was Vulcan’s 2019 sale of the nearby Arbor Blocks property, occupied by the company now known as Meta, for $1,069 per square foot. The Puget Sound Business Journal first reported on the new record.
Vulcan is developing a fifth building for Google, a 12-story high-rise at 520 Westlake Ave. N., southwest of the Lakefront Blocks, but completion of that project has been delayed by the concrete truckers strike.