- November 2016
Compiled by The Seattle Times Research Department
The Seattle Market Digest gives you a quick glimpse of the latest retail, real estate and business news in the Northwest. Curated from multiple sources, it keeps you updated so you can make more informed marketing and business decisions.
Regional Development: UW plans to expand upward in big growth spurt
Labor Market: Seattle-area jobless rate dips below 4 percent for first time in 8 years
Retail Market: South Lake Union gets a half-dozen brand-new restaurants
Travel Market: Alaska Airlines asks to delay Cuba service
Economy: Amazon shares tumble as profit misses Wall Street expectations
Real Estate Market: Seattle closing in on Portland for crown of hottest home market
UW plans to expand upward in big growth spurt
Energized by a thriving tech economy and fueled by a research arm that brings in more than a billion dollars in federal grant money every year, the University of Washington has ambitions to build 6 million additional square feet of academic, office and research space on its Seattle campus. The new buildings would make the university a third larger than it is today, square-footage-wise, as outlined by the UW’s draft master plan. It’s a plan that “creates a progressive and sustainable framework that will enable the UW’s continued evolution as a 21st-century institution,” said UW senior planner Theresa Doherty.
Source: The Seattle Times, October 24, 201
$87M for downtown parking garage
A six-level, 1,200-stall underground parking facility beneath the Pacific Place mall has been purchased by the mall’s owner, private equity firm Madison Marquette. This sale had been suggested by Seattle Mayor Ed Murray, who claimed the garage had been a financial burden for the city.
Source: Puget Sound Business Journal, September 30, 2016
WeWork opens big space in Bellevue
The gig economy shows no signs of slowing down, and WeWork is betting it will continue. The company announced in October it will open a 80,000-square-foot co-working facility in the Lincoln Square high-rise in Bellevue. The new facility, opening in early 2017, will be the fourth WeWork in the area, but the first outside of Seattle.
Source: Puget Sound Business Journal, October 10, 2016
Seattle’s new Hyatt Regency to get luxury-hotel neighbor
Seattle real estate development company R.C. Hedreen announced plans to build a 450-room luxury hotel right next to the new 1,260-room Seattle Hyatt Regency. The project, at Ninth and Howell, represents a smaller-scale version of a larger project which required City Council approval for one element, the sale of an alley running through the development. When that approval became unclear, the company decided to scale back plans to go with one that didn’t hinge on the alley sale.
Source: Puget Sound Business Journal, October 7, 2016
Tech company BitTitan to move headquarters to Bellevue
After many months of searching, fast-growing firm BitTitan finally found a place to call home. The Kirkland software-as-a-service provider has leased more than 60,000 square feet of office space in downtown Bellevue. Previous to this, it had been leasing office space near its headquarters after reaching capacity in May.
Source: Puget Sound Business Journal, October 18, 2016
MTorres Innovation Center to open in Everett
An aerospace engineering firm out of Pamplona, Spain, is building a 66,000-square-foot, $15 million facility in Everett. It will house 140 employees, and carry out collaborative research and development in robotics applications and composites manufacturing. MTorres specializes in automating manufacturing processes for aerospace and other companies, and offers engineering design, collaborative robot technology, process development expertise and other services.
Source: Puget Sound Business Journal, October 17, 2016
A game-changer for reviving Seattle Sonics
A new development group interested in remaking KeyArena into a new pro-sports arena and a better offer from developer Chris Hansen on his proposed Sodo arena give the city more options and a better chance of bringing the Sonics back. In October, developer Chris Hansen and his group offered a new approach to his agreement with the city for a publicly financed stadium. Rather than asking for $200 million in public-bond financing, Hansen and his group now would build the arena with private funds — but still with a few requested tax breaks.
Source: The Seattle Times, October 28, 2016
Vulcan expands its holdings in South Lake Union
A corner lot in the white-hot Seattle neighborhood of South Lake Union recently sold for $28.5 million. The buyer, Vulcan Real Estate, is no surprise. What is unclear is what Paul Allen’s company plans to do with the property. “We do not have a specific plan," said Vulcan executive Lori Mason Curran, adding that the company made the investment due to South Lake Union’s “excellent market fundamentals”.
Source: Puget Sound Business Journal, October 24, 2016
Seattle-area jobless rate dips below 4 percent for first time in 8 years
For the first time in more than eight years, the Seattle-area unemployment rate has squeaked below 4 percent, a milestone in the region’s continued economic resurgence. September’s 3.9 percent unemployment rate for the Seattle-Bellevue-Everett area is down from 4.1 percent a month prior, and 4.6 percent a year ago. It marks the first time since June 2008, when the region’s economy had just begun spiraling downward, that the jobless rate was below 4 percent, according to the state Employment Security Department. Overall, the local unemployment rate has been cut by more than half since peaking at 9.7 percent during the recession.
Source: The Seattle Times, October 19, 2016
Amazon to hire 3,000 seasonal workers in state, 120,000 nationwide
Amazon says it plans to add 120,000 seasonal workers nationwide as it deals with a holiday scramble that becomes more intense every year for the world’s biggest online retailer. That target for temporary positions is 20 percent higher than last year, a sign of how more shoppers — and third-party merchants — are flocking to Amazon’s online platform. In Washington state, Amazon says it’s hiring 3,000 seasonal employees at its Sumner, DuPont and Kent warehouses — a near-doubling of the workforce in those facilities. It’s also looking for temporary staffers for a call center in Kennewick. The fourth-quarter hiring ramp-up is not unusual in the retail industry: It’s the biggest shopping season, after all, when a lot of retailers make most of their profits.
Source: The Seattle Times, October 13, 2016
Oki sells 10 local golf courses for $137M to Chinese conglomerate
Oki Golf announced that it has sold its 10 local golf courses at eight locations for $137.5 million to a Chinese conglomerate, but Oki will continue to operate the courses. The buyer is HNA Holdings, a unit of a Hong Kong-based company that operates airlines, hotels and businesses that deal in financial services and real estate, and also owns other golf courses around the world. Golf has been struggling in recent years with fewer players hitting the links; Nike even recently abandoned its golf business. But founder Scott Oki, a former Microsoft executive, said in a statement he was “approached several times regarding acquisition.” A company spokeswoman said it decided to sell because HNA offered a strong financial and cultural fit — with HNA’s tourism and travel ties — and presented an opportunity for future growth.
Source: The Seattle Times, October 11, 2016
South Lake Union gets a half-dozen brand-new restaurants
Bar Harbor: This shipshape place near SLU’s Meat & Bread makes a lobster roll that Maine native and owner Ben Hodgetts considers close to perfection. Mbar: Chef Jason Stratton’s is making a gorgeous-looking (and spendy) menu — deploying his diverse expertise from Spinasse, Aragona, and Mamnoon. The White Swan Public House: “Think Radiator Whiskey meets seafood” at this place right on the lake. The gastropub menu from chef Josh Nebe features the likes of Poutine O The Sea: fries dressed with littleneck clams, chowder, bacon and scallions. Vestal, Poulet Galore and Cantine Bottleshop & Bar: Breaking its own previous record, the Huxley Wallace Collective has a three-fer of brand-new places, all in a row in SLU.
Source: The Seattle Times, October 3, 2016
Paseo and Li’l Woody’s announce new locations
Two popular local eateries are planning to expand in the local market. Burger “chainlet” Li’l Woody’s is opening a new spot at Boren and Thomas in South Lake Union. The new location will feature an outdoor deck and a location-specific burger. And popular sandwich joint Paseo is planning a new spot at 925 E. Pike, next to Neumo’s, to serve hungry Capitol Hill residents and clubgoers.
Source: : Seattlemet.com, September 26, 2016
Seattle’s Old Spaghetti Factory to close in December
Opened in 1970, the Old Spaghetti Factory in Seattle will serve its last entree on Dec. 23, according to a note posted to the restaurant’s website. Developer Nitze-Stagen and Meriwether Partners bought the two-story warehouse and an adjacent parking lot on Elliott Avenue for $9 million in July 2015 from the Dussin family, owners and operators of Old Spaghetti Factory restaurants. The Pier 70 site was one of the first in a chain started in 1969 in Portland that has more than 40 restaurants, including sites in Tukwila, Lynnwood and Tacoma. The developer’s plans for the site remain unclear. “We are just at the beginning stages of exploring our design options,” Meriwether Partners principal Joel Aslanian said in a 2015 statement.
Source: The Seattle Times, October 26, 2016
Area Stores Opening
New Li’l Woody’s in South Lake Union
New Paseo on Capitol Hill
Bar Harbor in South Lake Union
Mbar in South Lake Union
The White Swan Public House in South Lake Union
Vestal, Poulet Galore in South Lake Union
Cantine Bottleshop & Bar in South Lake Union
Alaska Airlines asks to delay Cuba service
The local air carrier, which planned to begin flying to Havana on November 29, requested a "modest extension" to start flights the first week of January instead. "The introduction of the first scheduled U.S. carrier service to Havana for more than 50 years presents significant operational and commercial challenges," said Kenneth C. Hines, a Washington, D.C., attorney for Alaska Airlines.
Source: Puget Sound Business Journal, September 28, 2016
Designs show future of Sea-Tac’s international arrivals hub
The Port of Seattle has released the latest design images for the new $660 million International Arrivals Facility at Seattle-Tacoma International Airport, scheduled to break ground early next year and to open in late 2019. International passengers arriving at Sea-Tac currently disembark at the south satellite terminal, which is seriously overcrowded at peak times. There, they must go through passport control and customs and wait for their bags. On exiting this space, many passengers then load their bags on a conveyor belt and take a train to the main terminal where they have to wait at another baggage carousel to reunite with their luggage one more time. The new International Arrivals Facility (IAF) will be a 450,000-square-foot, self-contained add-on that wraps around the current Concourse A in the main terminal building.
Source: The Seattle Times, September 29, 2016
Delta expands its footprint at Sea-Tac
Delta Air Lines continues to invest in the Seattle market with a planned $12.1 million expansion of its gates at Sea-Tac Airport. The company fast-tracked its gate reconfiguration project, citing a gate shortage that is only getting worse. The new project was announced a week after the Alaska Airlines competitor opened its $24 million Sky Club lounge at the airport.
Source: Puget Sound Business Journal, October 25, 2016
Norwegian Cruise Line orders up a bigger ship to expand Seattle-Alaska sailings
Norwegian Cruise Line will debut a mammoth new ship able to carry 4,000 passengers on Seattle-Alaska cruises beginning in 2018. Norwegian, which has a deal with the Port of Seattle to expand its Pier 66 cruise terminal in a $30 million joint project, now operates two 2,400-passenger ships out of Seattle during the summer. Andy Stuart, president and CEO of Norwegian, said one of those will remain on the route to supplement the planned Norwegian Bliss. That ship will be built in Germany and delivered in time to begin weekly seven-day cruises along Alaska’s Inside Passage in June 2018.
Source: The Seattle Times, October 13, 2016
Amazon shares tumble as profit misses Wall Street expectations
Amazon.com’s profit fell way short of Wall Street’s rosy hopes in the third quarter. On October 28, the tech juggernaut reported a 29 percent increase in sales to $32.71 billion, slightly more than analysts expected on average and a sign that its rapid growth continues unabated. But its profit of $252 million came to 52 cents per share, short of an expected 78 cents per share. The results triggered a sell-off. Shares, which were trading near record highs, fell about 6 percent to $771 in after hours trading.
Source: The Seattle Times, October 28, 2016
Hanjin bankruptcy is the tip of the iceberg for flailing shippers
For the last five years, top shipping companies pushed forward with fat investments in more and bigger vessels, even as signs of trouble piled up. The goal was to shore up profits by doing business on a larger scale as global trade bounced back after the recession. But the new business never came. Freight rates dropped and shippers’ revenues plunged. Today, the supply of ships and their capacity is completely out of whack with demand. China’s economy has slowed and consumer goods flooding the U.S. have saturated the market to the point where there’s no more room for growth, analysts say. And the industry is no longer under the delusion it can grow its way out of trouble. That became clear with the Aug. 31 bankruptcy of South Korea’s Hanjin Shipping, the world’s seventh-largest shipper, which temporarily marooned $14 billion of goods as ships were denied access to ports from Shanghai to Los Angeles.
Source: The Seattle Times, September 24, 2016
REAL ESTATE MARKET
Seattle closing in on Portland for crown of hottest home market
Seattle-area home prices are now rising at their swiftest pace in 2½ years, and the region is closing in on Portland for the title of fastest-growing home prices in the country. The typical single-family house across Greater Seattle cost 11.4 percent more in August than it did a year ago, according to the latest Case-Shiller home price index. That’s the eighth straight month of double-digit growth, and the biggest annual increase since March 2014. Portland again led the country, as it has all year, with home prices up 11.7 percent compared to a year ago. Both cities once again saw home costs rise at more than twice the national rate of 5.3 percent.
Source: The Seattle Times, October 25, 2016
South Puget Sound realizing its economic potential
Just six years ago, Auburn’s downtown core was full of vacant properties, and residential options were also lacking. But Doug Lein, former manager of Las Vegas’ economic development division, recognized the city’s potential. Lein came out of retirement to promote Auburn and South King County, and convince developers that there are excellent economic opportunities in the area. His efforts seem to be working. New residential, commercial and industrial developments are cropping up, often spurred by investors turned off by skyrocketing real estate prices in Seattle.
Source: Puget Sound Business Journal, September 30, 2016
This will be the final issue of Seattle Market Digest for this year. From all of us at The Seattle Times, have the happiest of holidays and a peaceful New Year.
If you have questions or comments about the Seattle Market Digest, please contact Research Analyst Steve Fuller at email@example.com
BEST IN THE WEST
Seattle has more construction cranes than any other U.S. city
Seattle is — for the moment, at least — the crane capital of America. This summer had 58 construction cranes reshaping the skyline — more than than New York and San Francisco combined. And it has an 18-crane lead over second-place Los Angeles.
Source: The Seattle Times, October 21, 2016
Seattle named best homeport in North America
With a picturesque waterfront, iconic skyline and new Central Link light rail system connecting cruise passengers to outlying areas and the airport, Seattle has been recognized by Cruise Critic as 2016’s best homeport in North America. Cruise Critic, a leading cruise review site, honored Seattle in its 9th annual Editor’s Picks Awards.
Source: travelandtourworld.com, October 18, 2016
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