BREAKING: Burien Town Square retail space put on market for $2.29 million
BREAKING: The retail spaces of the Burien Town Square property, located on SW 152nd between 6th Ave SW and 5th Ave Place, are now on the market – priced at $2.29 million – according to a website post.
The property consists of 19,671 square feet of retail space at the base of 124 condominiums, which are 90% sold. This includes one retail business – the Subway sandwich space – which has been open since March of 2012.
“ST Residential and their leasing agents have done a great job selling the condos,” Burien Economic Development Manager Dan Trimble told The B-Town Blog. “There are now only a handful left to be sold. The decision to sell the retail spaces brings the opportunity for new owners to focus on activating this important part of our Burien Town Square.”
This “breaking” news is good for the city, as it breaks a logjam that started when building developer Urban Partners was forced to suspend sales in 2009 when the FDIC shut down Corus Bank, holding their construction loan. After the FDIC seized the bank’s assets, including the loan, ST Residential became holder of its residential construction loan portfolio. ST Residential is comprised of the FDIC, which holds a 60 percent share of that portfolio, and Starwood Capital Group and four other private investors.
The tale behind this news is interesting, as it involves some genuine, homegrown community activism.
Many of our Readers may recall that Rep. Jim McDermott held a community coffee meeting at Grand Central Bakery on Oct. 19, 2013. At that meeting, local businessman John White asked McDermott if he could perhaps help get the FDIC to lower the rates at the retail space at Burien Town Square.
McDermott replied that he’d see what his office could do.
Then councilmembers Bob Edgar and Nancy Tosta met with the congressman, and again pressed him to do something about the property. McDermott suggested that the Council send him a letter to work on the situation, and at the request of the City Council, Trimble wrote the following letter on Feb. 3:
February 3, 2014
The Honorable Jim McDermott, Congressman
Washington State 7th Congressional District
1809 7th Avenue, Suite 1212
Seattle, WA 98101-1399
Re: FDIC Ownership of Burien Town Square Commercial Property
Dear Congressman McDermott:
The City of Burien would like your assistance in transitioning the ownership of the Burien Town Square Commercial Property back to the private sector.
Like many other real estate developments that were completed right before the Great Recession, the mixed use development in our Town Square was hit hard. Due to the national failure of Corus Bank, the construction lender for the development, the FDIC, seized the property. Only 6 units were sold at the time of the seizure. An equity partnership, led by ST Residential, was brought in with a 40% managing interest with the FDIC retaining 60% ownership and some decision making control on pricing and terms.
After an adjustment to market pricing, the residential units in the development are now selling quickly with only about 25 of the 124 units remaining. They will most likely sell out in the next couple of months. The commercial portion of the mixed use development has not seen the same resurgence in sales or leasing activity. Only one of the retail spaces has been occupied. However, I do not believe this is not due to a lack of interest. Unlike the residential spaces, which were finished prior to the seizure, the commercial paces are still in need of substantial owner/tenant improvements before they can be activated. It is likely that the combination of high lease/purchase rates along with the significant need for owner/tenant improvements is serving as a barrier to development.
The City would like to see this important part of our Town Center development returned to the private sector and activated sooner. We would appreciate your support in encouraging the FDIC to move forward with an exit plan that recognizes the local market and specific property conditions of this commercial development.
Economic Development Manager
The rate for the retail spaces – many of which aren’t even turnkey, or ready to move in – sets the price per square foot at $32.88. In comparison – according to the Downtown Seattle Association – the average Class A lease rate for Downtown Seattle was $32.52 at the end of 2013, up from $31.49 at the end of 2012.
Here’s the full listing as posted on the Liebsohn & Company website: