Former Martin Selig-Owned Buildings Find New Owner

Martin Selig Real Estate’s bloodbath in Seattle just entered its next chapter.

Seven distressed office buildings formerly under MSRE’s ownership across the city have been transferred to a new owner via a trustee’s deed, the Puget Sound Business Journal reported. CW Capital, which was previously the securities special servicer for the properties, bought the buildings for $120 million from trustee Amber Labrecque of Oregon-based ZBS Law.

The buildings include Fourth & Blanchard in Belltown, the 635 and 645 Elliott buildings in Elliott Park, the Fifth & Jackson Building in the International District and three other buildings in Lower Queen Anne. The properties total 1.1 million square feet and are between 16 and 55 years old. The portfolio backed $239 million in commercial mortgage-backed securities that were placed into receivership in March.

It’s the latest handover of properties for Martin Selig Real Estate. This spring, it surrendered ownership of the 15-story 400 Westlake building and the Federal Reserve Building in downtown to Acore Capital. The Federal Reserve Building is across the street from 1000 Second, a 40-story structure home to MSRE’s headquarters that was one of nine properties handed over to a receiver in June. That swath of nine buildings backed a $345 million loan.

It’s not just constructed buildings that MSRE has given up control of as part of the ongoing distress saga. The firm’s 800 Alaskan Way development site on the waterfront was transferred to Urban Renaissance Group this spring via deed-in-lieu of foreclosure. MSRE planned to build a 17-story tower with residences and commercial space at the site; Urban Renaissance now plans to redesign the project.

Earlier this month, Urban Visions and Diamond Parking bought a parking lot and adjacent building at 1931 Third Avenue in Belltown for $4.3 million, or $332 per square foot. The sale from a receiver works out to about a third of what Selig paid for the property a decade ago.

Selig himself has been feeling the heat. Over the summer, the 88-year-old listed his ski chalet in Idaho for $13.5 million. This spring, after the seven buildings in question were transferred into receivership, MSRE laid off 86 employees.

— Chris Malone Méndez