One of Seattle’s oldest skyscrapers has hit the market.
Unico and Goldman Sachs Management have put the historic Smith Tower on the market, but without a specified price, the Seattle Times, which discovered the news through a promotional flier, reported. The venture bought the 109-year-old property in 2019 for $138 million, the outlet reported.
The investment bank Eastdil Secured, which is overseeing the sale, confirmed the news.
The flier, according to the outlet, touts the property as “priced at a historically attractive basis” and highlights its potential to offer a slice of Seattle’s rich history as well as a promising future.
Built in 1914, Smith Tower was once among the tallest buildings outside of New York. The iconic tower boasts a 35th-floor observatory that draws visitors for its panoramic views of downtown Seattle and Elliott Bay.
The building also features office and retail space, with almost half currently unoccupied. This challenging office market environment has prompted the promotional material to suggest “ultimate business plan flexibility” with potential for future full or partial residential conversion. This echoes a trend seen across the nation, as office markets struggle in the aftermath of the pandemic, encouraging the transformation of unused office spaces into apartments or condos.
The property includes the adjacent two-story Florence Building, providing additional development potential. However, conversions of this nature can be complex and costly due to various factors, including infrastructure limitations.
The owners are seeking to divest the property due to the increasingly challenging office market conditions in Seattle, where a rising share of vacant office space has qualled investor interest.
They aren’t the only ones feeling the downturn of the office market in Seattle.
Martin Selig, 86, who is known for his resilience in previous downturns, is facing unprecedented challenges in the city’s current office market slump caused by the pandemic.
Despite his reputation as a deal-maker, Selig’s office portfolio has an uncomfortable 19 percent vacancy rate, significantly higher than the single-digit rates seen in 2019.
— Ted Glanzer