1Q’11 PUGET SOUND MARKET REPORT
Puget Sound Retail Market CO NSUM E RS RE T U RN The Puget Sound Retail Market has been
PUGET SOUND RETAIL SUBMARKETS MAP
consistently strong over the last five years, maintaining an overall vacancy rate of less than
5
7%. EVERETT CBD
An expanding population and strong regional employment both help to bolster this vital
S SNOHOMISH COUNTY
S EVERETT/ HARBOR POINTE Puget Sound
component of our regional economy. The Seattle Retail Marketplace continues to be strong and has not seen a vacancy rate above
EDMONDS/ LYNNWOOD
5% in the last five years. The core Seattle Retail
MILL CREEK/ WOODINVILLE
BOTHELL
405
Market, with its strong tenant mix and limited amount of available space, enables retailers to capitalize on the business traffic during the day and the surrounding residential communities during the evening hours. Retail centers such as Westlake Center and Pacific Place have seen a consistently higher flow of traffic since the holiday season and can begin to fully capitalize
NORTHGATE/ N SEATTLE
KIRKLAND
BALLARD/ U DISTRICT
QUEEN ANNE/ MAGNOLIA
520 CORRIDOR SUBURBAN BELLEVUE BELLEVUE CBD I-90 CORRIDOR
REDMOND
520
LAKE UNION
SEATTLE BELLEVUE
CAPITAL HILL/ CENTRAL DIST. BELLTOWN SEATTLE CBD
MERCER ISLAND
S SEATTLE
PIONEER SQ/ WATERFRONT
on growing consumer confidence and spending.
COAL CREEK/ ISSAQUAH
90
RENTON/TUKWILA
The Eastside Retail Market’s stability in the SEATAC/ BURIEN
Bellevue CBD is driven by Bellevue Square and Lincoln Square, which was recently approved for
5
a 1.6M SF expansion by The City of Bellevue.
KENT
LEGEND
Consumer activity will remain strong as the
Northend Retail Submarkets FEDERAL WAY/ AUBURN
number of Microsoft employees now working and living within blocks of this retail center continues to grow.
Eastside Retail Submarkets Seattle Retail Submarkets Pierce County Retail Submarkets
TACOMA
In addition to the retail core of downtown Bellevue,
suburban
retail
centers
such
as
needs, there will be an increased demand for retail areas that
Issaquah’s Pickering Place have also seen expansion, with
can support a growing population.
companies like Costco growing its presence in the area and
The Tacoma Retail Market has been flat in the last year with
expanding its headquarters.
little change. However, with a high volume of returning soldiers
The Northend and Southend Retail Markets have also
to JBLM, retail growth can be expected. One of the areas of
been experiencing positive growth. These traditionally more
note will be Point Ruston, a mixed use retail community on
suburban areas will see heightened activity as Boeing ramps up
Tacoma’s northwestern waterfront. The site will feature retail,
to begin production on their newly acquired tanker contract. As
restaurants, a movie theater, hotel and a mile long boardwalk
more suppliers move to these areas to accommodate Boeing’s
along the waterfront.
(4 2 5 ) 9 7 4- 4000
w w w. pa c i fi c -re.c om
S EAT T L E | BEL L EVU E | TA COM A | PORTLA N D
1Q’11 PUGET SOUND MARKET REPORT
Puget Sound Retail Market M A RKET S TAT IS T IC S A ND HIS TORI CA L T RE N D S
HISTORICAL VACANCY RATES & RENTAL RATES 7.0%
$25.00
6.0%
$20.00
5.0% 4.0%
$15.00
3.0%
$10.00
2.0% $5.00
1.0% 0.0%
2006
2007
Rental Rates
Puget Sound Retail Overview Market Area
2008
INVENTORY Buildings
2009
Direct Vacancy
Sublet Vacancy
Total Vacancy
1Q
YTD
2011
$0.00
Vacancy Rates
ABSORPTION SF
2010
AVERAGE RENT & EXPENSES Rent NNN
Downtown Seattle
3,105
32,347,157
3.3%
0.1%
3.4%
69,737
69,737
$19.68
$8.00
Eastside
1,827
30,807,169
6.6%
0.2%
6.8%
71,808
71,808
$21.85
$8.00
Northend
2,675
38,769,069
6.4%
0.4%
6.8%
83,585
83,585
$17.26
$5.50
Southend
1,753
29,476,356
7.6%
0.4%
8.0%
(19,699)
(19,699)
$16.20
$4.50
Tacoma
3,841
39,907,053
7.2%
0.1%
7.3%
(47,996)
(47,996)
$15.73
$4.50
PUGET SOUND
13,201
171,306,804
6.2%
0.2%
6.4%
157,435
157,435
$18.14
$6.10
2006
2007
2008
2009
1Q 2010
2Q 2010
3Q 2010
4Q 2010
1Q 2011
Downtown Seattle
3.7%
3.7%
3.5%
4.8%
4.7%
4.8%
4.0%
3.7%
3.4%
Eastside
4.5%
4.2%
4.8%
7.1%
7.2%
6.8%
7.0%
7.0%
6.8%
Northend
4.7%
3.8%
4.0%
5.9%
6.2%
6.4%
6.7%
6.9%
6.8%
Southend
4.9%
5.5%
6.4%
7.9%
8.2%
8.0%
7.7%
7.9%
8.0%
Tacoma
5.0%
4.4%
5.8%
7.0%
6.8%
6.9%
7.0%
7.2%
7.3%
PUGET SOUND
4.6%
4.3%
4.9%
6.5%
6.6%
6.6%
6.5%
6.6%
6.4%
Historical Rents (NNN) Market Area
Historical Total Absorption
2007
2008
2009
2010
Market Area
1Q 2010
2Q 2010
3Q 2010
4Q 2010
2010
1Q 2011
Downtown Seattle
$23.42
$24.42
$22.23
$20.20
Downtown Seattle
52,818
(35,163)
240,011
115,984
373,650
69,737
Eastside
$34.09
$31.95
$24.98
$21.88
Eastside
(8,828)
140,907
(59,179)
876
73,776
71,808
Northend
$20.93
$20.77
$17.94
$17.64
Northend
(111,073)
(31,665)
(103,473)
(73,047)
(319,258)
83,585
Southend
$22.05
$19.93
$17.11
$16.30
Southend
(54,498)
69,567
75,703
(64,013)
26,759
(19,699)
Tacoma
$18.52
$18.34
$16.77
$15.82
Tacoma
71,862
(25,405)
(36,309)
(74,142)
(63,994)
(47,996)
PUGET SOUND
$23.80
$23.08
$19.81
$18.37
PUGET SOUND
(49,719)
118,241
116,753
(94,342)
90,933
157,435
Average Asking Lease Rates Market Area
LEASE RATES (FULL SERVICE) Rent NNN
OPERATING EXPENSES* (PSF) TI's Parking
Downtown Seattle
$19.68
$8.00
$10-$20/SF
Free
Eastside
$21.85
$8.00
$15-$30/SF
Free
Northend
$17.26
$5.50
$10-$25/SF
Free
Southend
$16.20
$4.50
$10-$25/SF
Free
Tacoma
$15.73
$4.50
$10-$20/SF
Free
PUGET SOUND
$18.14
$6.10
$10-$30/SF
Free
(4 2 5 ) 9 7 4- 4000
w w w. pa c i fi c -re.c om
S EAT T L E | BEL L EVU E | TA COM A | PORTLA N D
Prior years as of 4Q
Historical Total Vacancy Market Area