By Marc Stiles
March 16th 2020
With Amazon planning to move in, the empty office Tower 333 in Bellevue has traded hands for $401.5 million.
The new owner, KKR & Co., of New York City, now owns two Amazon-leased towers — Summit III and Tower 333 — across the street from each other in Bellevue, where Amazon has said it expects to add 15,000 employees in the next few years.
The deal underscores what a draw Bellevue has become among real estate investors and developers, who in recent months have paid about $119 million for two large development sites — one on 108th Avenue Northeast kitty-corner from Tower 333 and the other on Northeast Eighth Street.
The Tower 333 price was listed on an affidavit that King County recorded, and seller Commonwealth Equity said Monday that proceeds after credits and transfer taxes were $316.7 million.
KKR has been on an acquisition tear in the Puget Sound region since the end of last year, spending a total of more than $1.64 billion on three assets.
In addition to Tower 333, formerly Expedia’s headquarters, KKR bought the office portion of F5 Tower in Seattle and the three-building Summit campus. Amazon has leased the third building, now under construction, in the Summit campus which is across the street from Tower 333.
The three assets total more than 2 million square feet. The $755 million Summit sale was the region’s largest real estate deal in 2019, and the Tower 333 is the largest so far this year.
Amazon has about $56.7 million in renovations underway in the tower, according to public records.
The 20-story tower at 333 108th Ave. NE., had last sold in 2009 for $168 million to HRPT Properties Trust of Newton, Massachusetts. The company changed its name the next year to CommonWealth REIT.
In 2014 a group of activist investors convinced shareholders to oust the board of the company after what the Wall Street Journal reported was an acrimonious, yearlong battle for control.
The group that took over voted in a new slate of officers led by Chicago billionaire Sam Zell. His former company, Equity Office Properties, was once the largest owner of commercial office property in the Puget Sound region.
The maneuvering last decade put Zell, who remains board chairman, and CommonWealth in Bellevue, not long before Amazon started leasing space there. Not only did CommonWealth lease Tower 333 to Amazon, it sold a key downtown Bellevue property to the tech giant.
That was Bellevue Corporate Plaza, which Amazon bought last year for $195 million. Amazon is planning to build two towers there called Bellevue 600.
KKR worked with Seattle-based Urban Renaissance Group on the acquisition of Summit, F5 Tower and Tower 333. URG will operate and manage the three assets.
URG founder and CEO Pat Callahan held key roles at Equity Office Properties.
Eastdil Secured marketed Tower 333 for sale.
