First New Tenants Signed for Time Square

RENTON, WA-Bedford Property Investors Inc. has landed its first two tenants for Time Square, a 334,000-sf five-building campus here that the Lafayette, CA-based REIT renovated after The Boeing Co. vacated the complex in February. Built in 1986, the 22.6-acre development is located near the SW 41st St. exit from Highway 167.Ticor Title Insurance Co. will occupy 11,337 sf and the City of Seattle will occupy 8,312 sf, both in 600 SW 39th St., one of the campus’ four 60,000-sf buildings (the fifth building is about 90,000 sf). The new leases fill about 6% of the complex. Pacific Real Estate Partners has the leasing assignment. The full service asking lease rate for space in Time Square is just over $20 per sf, including just over $6 per sf in operating expenses. The negotiated rate was not released by Bedford and not otherwise available.”We believe that the Puget Sound area is still experiencing the effects of significant job loss resulting from the technology and telecommunication industry slowdowns,” Bedford states in a November SEC filing, resulting in “excess space … and weaker deal terms.”Time Square is one of four developments Bedford owns in the Puget Sound Region. The others are the Highlands Campus Tech Center, a three building, 201,000-sf tilt-up office complex in Bothell, WA, and a two building 180,000-sf office development on South 344th Way in Federal Way, WA. Up until last week, Bedford also owned a 297,228-sf, two-building office complex in Seattle’s Fremont neighborhood that is 93% occupied by San Jose, CA-based Adobe Systems at around $18 per sf. The new owner is Hamburg, Germany-based Deutsche Immobilien Fonds AG, which last year acquired the 20-story Millennium Tower in Downtown Seattle. DIFA paid about $65.7 million for the properties. In late September, Bedford said it is evaluating the company’s “strategic alternatives” including the potential sale or merger of our company. Another option was the sale of certain of its 100 or so buildings, the proceeds from which would either be reinvested or doled out as dividends. So far this month, including the Adobe buildings, Bedford has disposed of eight buildings for a combined sale price of $127 million and a net GAAP gain of $50 million.