Slow multifamily market in Seattle jolts awake with two $100M deals

Two deals north of $100 million have turned a moribund multifamily market in greater Seattle on its head.

Greystar bought a 357-unit apartment complex at 510 Stevens Avenue SW in Renton for $108.5 million, or $303,922 per unit, the Puget Sound Business Journal reported. The sellers were Toronto-based Rise Properties and Tokyu Land US, a unit of Japan-based Tokyu Land.

Two days earlier, an affiliate of Goldman Sachs bought a 31-story, 338-unit apartment tower at 757 Thomas Street in South Lake Union for $174.8 million, or $517,160 per unit. The seller was Gemdale USA, a unit of China-based Gemdale.

The deals were a bright spot in a Seattle multifamily market that logged just eight commercial sales of $100 million or more since early last year, according to the Business Times. There were 68 such sales in 2021 and 2022.

Greystar, based in Charleston, South Carolina, purchased The Alaire, built in 1988 in Renton, 11 miles southeast of Seattle and home of a Boeing aircraft plant. It paid about $20 million less than the complex traded for six years ago, and $19.6 million less than its assessed value.

Rents range from $1,892 for a one-bedroom to $3,116 for a two-bedroom apartment, according to Apartments.com. 

Brokers Philip Assouad, Giovanni Napoli, Nick Ruggiero, Ryan Harmon and Anthony Palladino of IPA handled the sale. Institutional Property Advisors is a unit of Marcus & Millichap.

The same week, New York-based Goldman Sachs picked up the Skyglass, an accordion-like glass tower that its developer, Gemdale USA, dubbed “the largest public sculpture in the United States.” The luxury complex, which opened in March between the campuses of Amazon.com and Apple, has a gym and yoga room. 

Its studio apartments rent for as low as $2,379, while a three-bedroom unit can fetch up to $7,900, according to Apartments.com.

Brokers Marc Renard, Sam Wayne and Dave Karson of Cushman & Wakefield’s capital markets team represented Gemdale USA in the sale.

Brokers Dave Karson, Chris Moyer, Paul Roeter and Jason Blankfein of Cushman’s equity, debt and structured finance team served as the adviser to a joint venture between Goldman Sachs and Virtu Investments in landing an acquisition loan provided by Corebridge. The amount of the loan was undisclosed.

The sale of Skyglass came three months after Gemdale USA closed its Seattle office while parent Gemdale hit market headwinds. In December, China-based Caixin reported Gemdale was selling properties in the face of more than $1.38 billion in maturing debt.

Greystar, founded by Bob Faith in 1993, is the largest operator of apartments in the nation, managing more than 966,700 units and/or beds, with more than $36 billion in assets under development, according to its website. It has $320 billion in assets under management in 249 global markets.

Goldman Sachs, founded in 1869, oversaw more than $2 trillion in assets worldwide as of late 2022, according to its website. In June, the firm launched a $3.4 billion fund to buy shares from real estate investors and fund managers facing cash shortages, according to the Wall Street Journal.

Late last month, Goldman Sachs and Ballast Investments handed the keys to 82 apartment buildings in San Francisco to their lenders after defaulting on loans totaling $687.5 million.

— Dana Bartholomew

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