Madison Marquette acquires historic Pacific Place for a record $271 million.
Madison Marquette, a national real estate investment firm specializing in mixed-use commercial properties and a valued client of Foster Pepper, added to its portfolio in Washington state with its acquisition of downtown Seattle marquee retail center Pacific Place for a record $271 million. With its 325,000 square feet and five levels of shopping, dining and entertainment, Pacific Place will be another addition to Madison Marquette’s national portfolio of retail and mixed-use assets.
In July 2014, Madison Marquette, a Washington, D.C.-based national real estate investment and management firm focused on acquiring mixed-use properties throughout the United States, announced its acquisition of Pacific Place, a mixed-use property in the heart of downtown Seattle, for a record $271 million. The property was sold by Pine Street Development, a real estate developer and manager, after only six months on the market, to take advantage of investors’ great interest in Seattle commercial real estate. Foster Pepper represented Madison Marquette during this transaction, presenting the best of 15 offers for Pacific Place.
At 350,000 total square feet, Pacific Place is currently 90 percent leased by premium brand tenants including Tiffany & Co., Kate Spade New York, Michael Kors and Barneys New York. Pacific Place sees more than six million visitors a year and is a highly successful retail and entertainment destination: a perfect property for Madison Marquette to add to its portfolio of specialty shopping destinations.
Founded in 1992, Madison Marquette focuses on acquiring retail and mixed-use properties in major coastal markets throughout the United States. Through their investment and services platform, it enhances the value of its investments by offering full real estate services, including asset management, leasing and property management. Pacific Place, which will be managed and leased by Madison Marquette’s Retail Services Group (MMRS), is a perfect example of Marquette’s strategic effort to assemble a national portfolio of retail and mixed-use assets in dynamic markets that benefit from exceptional levels of economic expansion.
Pacific Place has experienced historic and transformative growth over the last twenty years since the outset. Developed and managed by Pine Street Group, Pacific Place played a key role in reviving the downtown Seattle shopping area during the 1990s.
After the Frederick & Nelson department store closed in 1992, downtown Seattle began losing retail customers to the outlying suburbs, like many previously-robust downtown cities at the time. The four corners at Sixth and Pine streets were boarded up and other retailers began to leave. Backed by numerous investors, Pine Street Development launched a $500 million redevelopment of the three-block area. The development was the one of the largest revitalization efforts in downtown Seattle since the rebuilding after the Great Fire in 1889. Pacific Place and the flagship Nordstrom store across the street, in the former Frederick & Nelson building, opened in 1998.
With conjunction with the explosive growth of South Lake Union, spurred by the revitalization efforts of Vulcan Real Estate, the center of downtown Seattle has shifted north in the last three years. As a result, Pacific Place is located more in the epicenter of the downtown retail core, further positioning it as a highly lucrative asset. The location and success of Pacific Place led to its position as a desirable asset for Madison Marquette. The final price of the purchase is for more than $774 a square foot, the largest recorded price per square foot for a large retail and entertainment complex in the greater Seattle area.
Pine Street Development and its investors will not be the only ones benefiting from the sale of Pacific Place - $14 million of the sale proceeds were donated to United Way of King County, a nonprofit organization dedicated to improving the community. The donation from the sale is thought to be the first time United Way received a donation directly linked to the sale of commercial real estate in the Seattle area.
Foster Pepper PLLC was honored to represent Madison Marquette in this historic transaction which greatly benefited our client and community.