Seattle Tech Courts Millennials Vying for Hip Housing

SEATTLE—IHP Capital Partners and Intracorp entered into a joint venture partnership in the acquisition of a 1.5-acre unimproved site for the development of a new urban infill community that is yet to be named. IHP and Intracorp plan to offer the first new homes for purchase in mid-2021.

Located between the North Beacon Hill and Mount Baker neighborhoods, the development will bring 58 townhouses and four live-work units to the Seattle market, where new home supply is in high demand.

The new community will comprise nearly an entire city block between South Plum Street, South Hill Street, and 24th and 25th Avenues South, making it significantly larger than any other infill project currently under construction in the city.

“Seattle is a world-class city with a thriving economy and strong workforce, with one of the highest populations of Millennials in the US,” Reneé McDonnell, senior vice president for IHP Capital Partners, tells GlobeSt.com. “We are pleased to partner with Intracorp, a longstanding leader in Pacific Northwest homebuilding, to bring much-needed new product to this market. These new townhomes are  designed to reflect all that the city of Seattle has to offer and appeal to residents looking for an active lifestyle.”

The 62 two- and three-story residences will range from approximately 1,200 to 1,700 square feet and be offered in five floorplans featuring two to three bedrooms. The majority of the homes are designed with full-floor master suites, and half of the units will have roof decks that offer views of Mt. Rainier to the south and the Seattle city skyline to the north. Townhomes without roof decks will feature large private upper-floor decks. The layout of the community will include landscaped courtyards with walkways throughout and a large gathering plaza with seating and play areas.

The North Beacon Hill/Mount Baker area has emerged as one of Seattle’s most desirable places to live in recent years. Located near the Interstate 90 freeway and close to future light rail transportation, this new community will have access to nearby employment centers. The project is a 10-minute drive from downtown Seattle and is surrounded by schools, restaurants and shopping.

“Strong regional employers such as Amazon and Google continue to support Seattle’s population and wage growth. This, coupled with young buyers who are eager to take advantage of historically low mortgage rates, is a key driver to the area’s rising demand for quality new homes,” said Mike Lierman, president, Northwest and Northern California for Intracorp. “Our team is excited to transform this underutilized property into a beautiful modern community in a prime location along with our partners at IHP.”

This community is the second joint venture and first in Seattle between Newport Beach-based IHP Capital Partners and Intracorp, which has completed several new home neighborhoods in Washington during the past 40-plus years.

The tech industry added 3.5 million square feet of office space in the Puget Sound area last year, now totaling 46.6 million square feet, according to a CBRE office report. The Eastside has skyrocketed in popularity, claiming 60% of tech leasing activity in 2019, up from 21% in 2015.

During the last decade, tech leasing volume has more than doubled, now accounting for 54% of all new office leases. Tech firms have preleased 60% of all new office construction set to deliver before 2022 and demand far outpaces incoming supply through 2021.

As for COVID’s impact, sublease availability and vacancy did increase notably in second quarter, up 21% and 23% respectively quarter-over-quarter, yet the vacancy rate is less than 40% of the dot-com era’s peak, says the report.