Offering Summary

Overview

Kidder Mathews is pleased to exclusively list for sale an extremely rare development opportunity in West Seattle’s Alki neighborhood. Situated on the shores of the Puget Sound, this large assemblage of land consists of five different parcels from two separate owners, consisting of ±21,277 square-feet. Very seldom does land of this size become available on Alki Beach, as most large parcels have already been redeveloped and existing underdeveloped lots are much smaller in size.

The Alki Development Site has unobstructed views of the Olympic Mountains, the Puget Sound, passing ferries, and gorgeous nightly sunsets. Its close proximity to the 135-acre Alki Beach, along with restaurants, bars, and boutiques, makes the site an ideal location for locals and out-of-state incoming residents.

Known as the only true beachfront community in Seattle, the Alki Beach neighborhood is as close as one can get to living in a beachy paradise in the Pacific Northwest. The location offers beach volleyball tournaments, summer concerts, sunbathing, whale watching, and nighttime gatherings to watch the sunset around beach fire pits. Year-round visitors and residents alike can be found walking, biking, or blading down the boardwalk that fronts the Alki Ave Development and the unique local eateries and beach shops.

West Seattle attracts more Californians than any other neighborhood in the nation, particularly Silicon Valley transplants, according to a study conducted by Redfin. In addition to its beachfront access, West Seattle has the ideal combination of being laid back, yet offers an exciting nightlife in the neighborhood’s charming Admiral and Junction Districts. Home values are more affordable than other core markets in the city, yet it offers unparalleled city and western exposure views.

In addition, the Alki Development Site offers ease of access to all of the major hubs and employers in the region. Seattle’s CBD is located only 15 minutes by car or 10 minutes via the West Seattle Water Taxi, which is located less than one mile from the Property. As such, residents can reach Amazon’s world headquarters, Starbucks world headquarters, Google’s SLU expansion, Facebook, Apple, F5 Networks, and Expedia’s new Seattle campus. Boeing Field and Boeing’s 737 plant are located 15 minutes south and Pioneer Square, an emerging tech hub in the region, is only 12 minutes east.

The current (2017) estimated average household income within half a mile is $125,228 and is projected to be $162,971 by 2022.

Highlights

  • Rare Opportunity: ±21,277 square foot site in West Seattle’s Alki Beach neighborhood
  • High barrier-to-entry location: extremely limited supply
  • Height limit of 60’ with bonus up to 75’ to 80’
  • Base Floor-Area-Ratio of 3.2 with bonus up to 4.25 to 4.5
  • Projected average household income of $162,971 by 2022 within 0.5 miles
  • Sweeping water views of Puget Sound; directly across from Alki Beach
  • Less than one mile from West Seattle Water Taxi
  • 15 minutes to Seattle CBD
  • 10 minutes from future West Seattle Light Rail station
  • Walking distance to dining, shopping, grocers, & nightlife
  • West Seattle is the most sought-after submarket in the nation for Silicon Valley transplants
  • Condo values next door north of $1M
  • West Seattle vacancy rate of 3.7%

Development Opportunity

The Property currently produces income from an existing 8-unit apartment building, two duplexes, and a single-family home, allowing an incoming buyer to generate revenue while going through the permitting process to build a condominium project or high-end apartment building.

The Alki Ave Development site is zoned Mid-Rise (MR). The City of Seattle’s location criteria for MR zoning includes areas that provide concentrations of housing in desirable, pedestrian-oriented urban neighborhoods having convenient access to regional transit stations, where the mix of activity provides close proximity to a full range of residential services and amenities. MR zoning does not have any density requirements and allows for up to 60’ heights; however, the Alki Ave Development site is capable of receiving a height incentive up to 80’. MR zoning calls for a base floor area ratio (F.A.R.) of 3.2 with bonus incentives going up to 4.25 to 4.5.

An incoming investor can choose to redevelop the site into luxury apartments or condominiums. Neighboring buildings are selling condos for north of $1M or north of $600/SF, for much older stock. Regardless, this is an excellent opportunity to develop one of the last development sites in the Alki Beach neighborhood, one of Seattle’s most sought-after locations.

Market Overview

Strong Regional Fundamentals - Greater Seattle Area

  • Seattle MSA ranked top investment market in the nation
  • Tri-County rents grew 7.8% in 2017 and 7.5% in King County
  • Puget Sound added 57,900 new jobs in 2017, another 41,400 projected for 2017
  • 139,900 new jobs projected from 2018 – 2022 in Puget Sound region
  • Puget Sound employment grew 2.8% in 2017 compared to national average of 1.5%
  • Seattle ranked #2 in the nation for businesses and careers in 2016 by Forbes
  • Seattle MSA ranked #3 on Glassdoor’s Best Cities for Tech Jobs based on employment and salary growth
  • Seattle MSA ranked #1 best metro area for STEM professionals in 2017 by WalletHub.com
  • Seattle MSA ranked #2 for highest percentage of workforce in STEM and #1 in STEM wage growth
  • Personal incomes for Puget Sound grew 9.2% over the past two years combined
  • Puget Sound Regional Council projects 4.7% personal income growth in 2018
  • Every five new jobs creates one net new renter; projected 27,980 net new renters between 2018 - 2022 for Puget Sound
  • 5.7% population growth forecasted from 2018 - 2022 for Puget Sound
  • Seattle MSA has the fastest rising home prices in the nation at 12.3% coupled with a lack of new construction: high barrier-to-entry market

#1 City in U.S.
to find a job

Wallet Hub, 2015

#1 Nation’s most
sustainable city

STAR Communities

#2 top city
for tech jobs

Geekwire, 2016

Location

50-Yard Line Location

  • Located in West Seattle: ultra-hip businesses and unique culture
  • 180 degree views of the Puget Sound
  • Fortress location: lack of available land
  • Excellent retail amenities, schools, parks, and library nearby
  • 5 miles to 135-acre Lincoln Park
  • Exceptional location for outdoor enthusiasts: Alki features a 2.5 mile waterfront walking trail and 135.9 acre beachfront park
  • 1 mile from the West Seattle Water Taxi with service to Seattle CBD
  • PCC Community Market and Metropolitan Market within minutes
  • 10 minutes to South Seattle Community College
  • 12 minutes to Pioneer Square high-tech corridor
  • 15 minutes to downtown Seattle
  • 15 minutes to Amazon’s world headquarters in SLU
  • Within 2 miles of assigned Alki Elementary School with a GreatSchools.org rating of 9 out of 10
  • Numerous dining, retail, and grocery amenities within minutes

West Seattle

West Seattle is a vibrant neighborhood located just five miles southwest of Downtown Seattle, to the west of the Duwamish River. The area is made up of several neighborhoods, large parks, and beachfront with views of the Seattle skyline and the Olympic and Cascade Mountains. In addition to appealing to downtown professionals, West Seattle attracts residents that work in the south end at employers such as Alaska Airlines, Boeing, and Starbucks.

Admiral District

The Admiral District lies on the northern bluff of the West Seattle peninsula (accurately titled the Duwamish Peninsula, after the local Indian tribe), less than two miles south of the Site. It is rich in views and lovely old homes and maintains a lively restaurant trade. The Admiral District hosts their own events like clean-up days, outdoor concerts, community forums, and art walks.

The Admiral District successfully combines a beautiful residential area with ultra-hip businesses and unique culture. Patrons enjoy eclectic shops, boutique eateries, and the historic Admiral Theatre. Popular destinations include Metropolitan Market, PCC Community Markets, Hiawatha Park, The Swinery, Prost!, and Luciano’s.

The park includes fire pits, picnic tables, and a bathhouse with an art studio.Throughout the summer there is also beach volleyball, and regional volleyball tournaments are held there. The beach is also a venue for concerts and features local artists.

Alki

The Alki Ave Development Site are located in the most sough-after neighborhood of West Seattle across the street from Alki Beach Park. Alki is known for its popular beach vibe with arts-and-crafts bungalows nestled between newer condominiums and apartment buildings along Alki Avenue. Alki Point in West Seattle is considered to be the founding point of Seattle, before downtown was moved to its current location. Each year, the summer regional, month-long Seafair celebration commences with a reenactment at Alki Beach that commemorates the landing of the original explorers in 1851.

Today, Alki is home to iconic eateries including Spuds, which has been serving fish and chips on Alki since 1935, the upscale Salty’s waterfront seafood restaurant, Pegasus Pizza, Cactus, and Phoenicia.

The Junction

Further south on the West Seattle peninsula is The Junction and the cross streets of California Avenue SW and SW Alaska Street. This intersection and surrounding area is host to a myriad of restaurants, cafes, and unique shops. A variety of events take place around The Junction, from monthly art walks to open-mic nights, beer and wine tastings, and seasonal events. West Seattle’s year-round Sunday farmer’s market is held in The Junction, featuring produce and offerings from over 35 Washington State farmers and local food processors.

Employers

Pioneer Square

Pioneer Square is the closest employment center to West Seattle once residents cross the West Seattle Bridge. The Pioneer Square neighborhood is one of the largest concentrations of historic buildings in the nation. These buildings are being repurposed as office space, with large companies such as Weyerhaeuser and Avalara moving into this up-and-coming employment hub. Several start-up companies choose to lease space in Pioneer Square due to the more affordable lease rates and its superior regional transportation options. Companies such as Blue Nile, HTC, Hulu, Intel, Payscale, and Rover.com are located in Pioneer Square.

Amazon

Founded by Jeff Bezos in 1994, Amazon is the global leader in e-commerce and cloud computing with their world headquarters in Seattle. Amazon’s cloud computing services are among the largest in the world, serving everyone from small companies to large corporations and government agencies. In 2015, Amazon surpassed Walmart as the most valuable retailer in the U.S. by market capitalization. Amazon is the largest internet company in the world and the fourth most valuable public company in the world. Additionally, Amazon is the eighth largest employer in the United States.

Seattle CBD

Just 15 minutes from the Site, Seattle’s Central Business District (CBD) is the Pacific Northwest’s largest employment center which accounts for nearly 300,000 jobs. Major employers comprising the CBD job market include Amazon, Bank of America, Blue Nile, CenturyLink, Chase, Cobalt, Dendreon, DocuSign, EA Sports, Facebook, Getty Images, Kaiser Permanente, HTC, Hulu, King County, Microsoft, Nordstrom, Onvia, Port of Seattle, Russell Investments, Safeco Insurance, Starbucks, Swedish Medical Center, Tully’s Coffee, Twitter, University of Washington, Virginia Mason, Vulcan, Washington State, Wells Fargo, and Zillow.

In addition, companies such as Alibaba, Apple, HBO, Dropbox, and Payscale have opened up offices in and around the Seattle CBD. Expedia is currently underway with improvements on their future Seattle waterfront headquarters which is slated to open in 2019. Expedia’s new campus will bring an estimated 4,500 jobs to the city once open.

Boeing

Boeing continues to produce the 737 out of their Renton Factory, 15 miles south of the Site. The 737 is still the best-selling commercial aircraft in the world. Boeing was also awarded the Navy’s Multi-mission Maritime Aircraft contract and will build what is projected to be 300 of the new submarine hunters at the Renton plant. Boeing also produces the new 737 MAX out of its Renton plant which is the fastest selling airplane in Boeing’s history. With its first delivery completed in May 2017, the new airplane already has over 4,000 orders.

Boeing has gone on a building spree for its Next-Generation 737, recently increasing its production rate from 42 planes per month up to 48 planes as of July 2017. Boeing previously announced plans to produce up to 52 planes per month by 2018. Boeing delivered a record high 762 airplanes in 2015 and currently has 5,700 orders for commercial airliners.

Boeing Field

King County International Airport, also known as Boeing Field, is less than 15 minutes south of the Site. With a total of 594 acres, Boeing Field is one of the busiest primary non-hub airports in the country and supports over 5,200 direct jobs. The airport serves small commercial passenger airlines, cargo carriers, private aircraft owners, helicopters, corporate jets, military, and other aircraft. Boeing currently has operations at the airport, including final preparations for 737s, flight test facilities, and a paint hangar.


Swedish – West Seattle

Swedish Medical Center offers a primary care clinic in West Seattle, less than 10 minutes from the Site. The Swedish West Seattle Primary Care clinic offers several services, ranging from family medicine to minor surgical procedures.

Swedish Medical Center is an established regional healthcare provider, operating in the Seattle area for over 100 years. They are also the largest nonprofit health provider in the Greater Seattle area, with five hospitals throughout the area, specialty care, and emergency rooms in Redmond and Mill Creek, and over 100 primary care and specialty clinics that are compromised of the Swedish Medical Group and relationships with suburban hospitals and physician groups.

Starbucks

Starbucks got its start in 1971 at Pike Place Market in downtown Seattle with the intention of being a world-wide coffee roaster and retailer with the best coffee on the market. 45 years later, Starbucks is still operating their Pike Place Market storefront in addition to over 26,700 locations around the world and is the best-known coffeehouse chain globally. Starbucks’ corporate headquarters is located less than five miles from the Site in Seattle’s SoDo neighborhood.

In October 2015, Starbucks hired its first Chief Technology Officer to lead their technology team. The company has been growing their technology team which is based out of the Seattle headquarters ever since. As of July 2017, 9% of U.S. purchases were made on customer’s mobile phones using the Starbucks app, up 50% from last year. Approximately 3,500 people work at Starbucks’ Corporate office with approximately 1,000 in technology development.

Due Diligence

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