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Amazon walks away from 722K sf lease for Seattle’s Rainier Square
Leased signed in 2017 by e-commerce giant was one of Seattle’s biggest
UPDATED, Feb. 27, 3:53 p.m.: Amazon is walking away from another huge real estate deal, this time in its hometown of Seattle.
The e-commerce giant is cancelling a 722,000-square-foot lease for the entirety of Wright Runstad & Company’s 58-story Rainier Square tower, currently under construction, according to the Seattle Times. Last year Amazon threatened to pull the plug on the lease if the city passed a proposed business tax, which it ultimately did not.
The decision comes just two weeks after Amazon shocked real estate watchers and abandoned plans for a new 25,000-job headquarters in New York’s Long Island City neighborhood. In doing so, the company turned away from a $3 billion incentive program amid intense opposition to the deal from some city, state, and federal lawmakers.
Both the Seattle and Long Island City episodes show Amazon is willing to leave major deals on the table if it can’t get the economic concessions it wants from local governments. Seattle’s so-called “head tax” would have taxed large companies around $275 per employee to pay for services and housing for people experiencing homelessness.
The Rainier Square lease was one of the biggest in Seattle’s history. The facility would have been large enough for 3,500 to 5,000 employees, who would have cost the company between $692,000 and $1.4 million in head taxes.
The tower is set to be the second-tallest in Seattle and will cost $600 million to develop. It’s one of the largest real estate projects underway in the country.
Amazon currently has around 45,000 employees working in 40 buildings in Seattle. [Seattle Times] – Dennis Lynch
Correction: A previous version of this story incorrectly stated that Seattle had passed the proposed business tax.