Kennedy Wilson grants $ 200 million acquisition loan for Microsoft leased office campus – Commercial Observer
PGIM Real Estate and Talon Private Capital secured a $ 200 million acquisition loan for their recent purchase of Advanta office communities, a state-of-the-art office campus fully leased to Microsoft Corporation in Bellevue, Wash., Commercial Observer learned.
Kennedy wilson provided the financing, in a transaction negotiated by Cushman and Wakefield‘s Rob rubano and Keith padien.
The asset traded for $ 169 million, according to CoStar Group, making the transaction the largest office sale by total price in the Puget Sound area this year to date. Honolulu, based in Hawaii The Shidler group previously paid approximately $ 225 million for the asset in 2018.
The 600,000 square foot campus includes three seven-story Class A office buildings and is located at 3005 160th Ave SE in Bellevue’s Eastside Office Market, one of the West Coast’s most dynamic and limited office markets.
The property sits on a 14.6 acre site. Two of the three buildings are connected by a 25-foot-high and 100-foot-long glass atrium that includes a chimney and a body of water. The property also includes a 120,000 square foot parking garage.
It is fully leased to Microsoft until September 2023, and has been since the property’s construction completed in 2008. The tech giant has a five-year renewal option remaining on its lease and is in good company from a standpoint. tenants in the submarket; the campus is close to those occupied by other renowned high-growth tenants, such as Amazon, Facebook, Selling power and Google.
Kennedy’s Wilson loan covers about $ 120 million in upfront funding and about $ 80 million in future funding for cap-ex and carry fees in the event Microsoft does not renew its lease, sources said.
The Puget Sound-Eastside office market continued to attract investor interest throughout the pandemic, supported by the technological nature of its tenant base.
In September of last year, Facebook cemented its commitment to the region when he paid $ 368 million to purchase REI’s brand new 400,000 square foot head office in Bellevue.
And further north, in Redmond, Washington – the home of Microsoft, as well as Nintendo – Vanbarton Group closed on his the acquisition of Millennium Business Park last December; a portfolio of six office buildings 95% leased to Microsoft, as reported by the CoStar Group. The asset traded to $ 217 million.
Kennedy Wilson and PGIM officials did not return a request for comment. A spokesperson for C&W declined to comment.