Dude, Here's How to Get Tenants

Seattle's in the midst of a fairly tight employment market, with tech/creative and professional services firms all competing aggressively for the Millennial employee, Laura explains. This has meant that buildings--whether they're in the on the skyline or not--have to offer a fresh, vital look and highly amenitized environments. (In- office magician?) The cool factor, if you will, in order to win new tenant interest, she says.

Cool core buildings also attract investor interest. According to JLL's latest research, Seattle saw the 8th largest sales transaction rate in the nation in trophy and Class-A office, and rent growth among newly traded properties has been significant. Such Seattle buildings that have traded since 2011 have an asking rate of $38.27/SF, a premium of 6.8% above the trophy and Class-A asking rates nationwide. JLL managing director Lori Hill (snapped recently with Roger Staubach) tells us that Seattle now counts as a tier-one gateway market for institutional investors, who're still looking for high-profile core properties. Seattle offers them that.

The Puget Sound area is going to see population and job growth for the foreseeable future--decades into the future, including urban downtowns as well as the suburbs--says Cairncross & Hempelmann attorney Nancy Rogers, who moderated both panels at Bisnow's recent Seattle Construction & Development Summit. (And as we all grow older and the population grows, the grocery store line wait is going to skyrocket.) The region's growth, she tells us, is driving public policy trends that will affect developers and property owners. The Seattle area can't simply sprawl, both for geographic reasons and because the Growth Management Act determines what will be at urban density, and what won't. The GMA is going to continue to drive density in areas in which density is allowed, and that's going to continue to drive up prices as land supply becomes more constrained.

At the state level, Nancy says that it's tough to know when a comprehensive transportation policy is finally going to emerge from the state legislature--though one needs to, and the sooner the better. “We need improved transportation infrastructure,” she says. “It's vital to serve existing businesses, and allow new businesses to grow.” (Tandem bikes just aren't going to be a viable transportation options, regardless of what the Muppets might have you believe.) So far the state hasn't stepped up to the plate to pass a transportation package. There's still a lot of disagreement in Olympia about how state-run projects should be permitted and run, among a number of other sticking points. Nancy's snapped at home on her deck, which just happens to have a terrific view of downtown.