Recapitalization Brings Lobby, Common Areas and Retail Upgrades

SEATTLE—Seattle-based commercial real estate firm Urban Renaissance Group LLC recently completed a recapitalization of its Plaza 600 building, a 214,319-square-foot class-A office asset, with real estate investment firm BentallGreenOak. As part of the recapitalization, URG will re-invest in the asset with planned improvements including a fully renovated lobby, upgraded common areas and ground-level retail improvements.

“Our recapitalization of the Plaza 600 building with BentallGreenOak represents a long-term commitment to investing in this well-positioned asset in Seattle’s CBD,” Patrick Callahan, URG founder and chief executive officer, tells GlobeSt.com. “We expect new investments in the building to begin this year.”

URG originally purchased the 20-story building in 2012, just prior to Amazon’s rapid headquarters expansion in downtown Seattle. Since then, URG has made significant investments in the asset, including exterior plaza renovations, new pedestrian access to Westlake and common-area upgrades.  The back-of-house systems were also improved, notably the pressurization of the building core, which allows for a medium-sized tenant to have an open floor plan with access directly off the elevator.

“BentallGreenOak has been a long-standing investor in the Seattle real estate market and we continue to believe in the fundamentals that make this a region of tremendous opportunity. We are pleased to add to our firm’s portfolio in this market with the recapitalization of Plaza 600, and to confirm our commitment to co-investing with URG in this well-positioned asset,” said Steve Reents, managing director of investments with BentallGreenOak. “Partnering with URG, whom we view as best-in-class, brings a depth of expertise and capability to our joint efforts to successfully position this asset for the future.”

The Plaza 600 building was built in 1969 and includes 209,256 square feet of office and 5,063 square feet of ground-level retail, and is currently more than 91% leased. Plaza 600 tenants benefit from its strategic CBD location at the corner of 6th Avenue and Stewart Street. Located a block from Amazon’s headquarters, the asset is also immediately adjacent to Seattle’s downtown retail core and the South Lake Union line of the Seattle Streetcar.

“Given Plaza 600’s proximity to Amazon’s headquarters and downtown’s ever-expanding technology office market, now was the right time to find a partner who saw a long-term interest in both the asset and our partnership,” said Callahan. “We’re looking forward to reinvesting in this building in modern and exciting ways. We’re also very pleased to be reinvesting in this asset with BentallGreenOak.”

Eastdil Secured managing director Jason Flynn brokered the transaction on behalf of URG.

The Puget Sound regional year-end office market results showed continued strengthening during the final quarter with vacancy dipping from 5.99% last quarter to its current position of 5.87%, according to a report by Kidder Mathews. With year-end net absorption of nearly 5.8 million square feet, the tech titans again continued to satiate appetites for close-in office space heading into the new year. Cranes remain active in both Seattle and Bellevue with developers positioned for new construction in both the Seattle and Bellevue CBDs, as downtown class-A space becomes increasingly scarce, says Kidder.

2019 will be remembered in no small part for the five tech giants expanding footprints throughout the region. While some of the newer tech companies also made a splash in 2019, it has been Amazon, Google, Facebook, Microsoft and Apple that continue to be the driving forces behind the regional office surge, according to the report.