Pine Street Development Selling Former Nordstrom Buildings

SEATTLE-Pine Street Development LLC has begun selling off the two former Nordstrom department store buildings it renovated into mixed-use properties. The buildings are located across from Pacific Place, the shopping center it developed in the 1990s and plans to hold for the long term. The larger of the two buildings, the 125,000-sf Fifth & Pine Building recently sold for $55 million to Deutsche Immobilien Fonds A, a price that local sources tell GlobeSt.com equates to a cap rate in the high 6% range. The other property , 1505 Fifth Ave., an 80,000-sf property that it controls through a long-term leasehold, is not yet on the market. Both buildings house retail tenants on the ground floor and office tenants above.Pine Street Development is a joint venture of Pine Street Associates LLC, a group of 15 local investors led by Matt Griffen of Pine Street Group, and Multi-Employer Property Trust, a $4-billion commingled open-end real estate equity fund owned by Taft-Hartley and public employee pension plans. In addition to its affiliates’ interest in Pacific Place and the former Nordstrom buildings, Pine Street Group also is involved in the mixed-use development that will house Washington Mutual and the Seattle Art Museum. The Fifth & Pine Building was about 9% vacant at the time of sale. The vacancy is comprised of a single 11,000 sf space on the third floor of the five-story building. The asking rate is $10 per sf per year, triple net. Existing tenants include Coldwater Creek, Anthropologie, Urban Outfitters and Sephora on the retail side and, on the office side, Marchex, Aetna Life Insurance Co. and the engineering firm Coughlin Porter Lundeen. The 1505 Fifth Ave. building, meanwhile, is 100% leased. Ground-floor retail tenants include adidas and Diesel. Office tenants include Edleman PR. The building also houses a communications hub for WilTel Communications. Pine Street Development, which controls the asset through a long-term leasehold, is in the process of clarifying things with regard to that agreement. “We need to do a little more work getting that one finished,” Griffen tells GlobeSt.com. “Then we plan to sell it as well.” The property should be on the market in the next 12 months, he says.