"We need to realign the timing and components of the project to meet changing market demand, which today favors constructing the residential and hotel tower ahead of the office building," says Richard Leider, Lincoln Square's project director. "Our reevaluation period should allow us to deliver Lincoln Square's components in a staged approach, which city building permit and the current monolithic design – building all components simultaneously – do not allow."
The original project, slated for completion in the fall of 2003, was to contain a four-star, 303-room Westin Hotel, a 530,000-sf, 27-story class A high rise office building, five levels of underground parking, 148 luxury residential units in a 41-story tower and approximately 330,000 sf of retail, restaurant, entertainment and health club facilities.
Lincoln Square is being developed at the corner of Northeast Eighth Street and Bellevue Way. To date, the project's below-grade level parking has been completed, and construction has started on its commercial space. The project's leasing and marketing programs will continue, but site activity will begin slowing down immediately as various phases continue to an appropriate point when they will be suspended over the next several weeks, says Leider.
More than 100 of the 148 residential units have been sold, but office leasing "has struggled has struggled in the face of the regional tech industry downturn," says Leider, not being specific as to whether any office space has been leased or not. Vacancy rates in Bellevue now top 25%. "We need to reassess the timing of delivery for each of the component parts, possibly moving up the residential stage and delaying the office," he adds.
In March, Bright Horizons Family Solutions, a national provider of childcare and education centers that preleased 11,000 sf in the 1.4-million-sf Lincoln Square complex by Lend Lease Real Estate Investments Inc., has jumped ship and signed on at another up-and-coming development, The Summit by Bentall Northwest.
Debbie Brown, VP of Northwest client services for Watertown, MA-based Bright Horizons, told GlobeSt.com at that time that multiple delays in Lincoln Square's construction prompted the firm to use an escape clause in its lease. "Obviously it would have been easer to stay (at Lincoln Square)," Brown offers. "Now we're having to start over, and that takes time and energy. But the construction delays (at Lincoln Square) were going to put us out further than we were willing to go."
Despite that, Leider in March maintained that "Lincoln Square ownership is proceeding with an aggressive construction schedule and is expected to open as planned in summer 2003."
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