Vulcan to Sweeten the Deal with Buyer Perks

If you've been paying attention to the Redfin South Lake Union listings feed in the right column, you'd have noticed that Vulcan's condos are dominating the results, as they've released several units to the MLS in the past weeks.

It seems that fear the housing downturn will hit Seattle is keeping buyers on the fence, and Vulcan and other developers are now in a contest against one another to come up with the most enticing perks. From the Puget Sound Business Journal:

In the coming weeks, Vulcan will roll out incentives aimed at buyers living and working in South Lake Union, where it has three condo developments under construction.

While its incentive plan is still in the works, one of its perks will be to pay a chunk of the closing costs for buyers who are currently renting at a Vulcan property and want to buy in the neighborhood, said Lori Mason Curran, real estate market research manager for Vulcan, Microsoft Corp. co-founder Paul Allen's real estate investment company.

"There has definitely been a slowdown in condo sales at all projects in Seattle," said Mason Curran, who declined to release Vulcan's pre-sale figures.

Vulcan's move is a reflection of the slowdown in the housing market across the Puget Sound region that's given prospective condo owners the upper hand. Developers of condos, fighting stagnant sales, are offering more perks than ever to potential buyers -- including cars, vacation packages and, in one case, Vespa scooters.

"We have a substantial amount of buyers out there, but they are all on the fence," said Matthew Gardner, whose consulting firm Gardner Johnson works with Vulcan.

"The last thing anyone wants to do is buy in a market that is declining."

What would get you in the mood to buy? An old fashioned haircut, or something a little more unique? Stay tuned to see what ends up going in the grab bag.

Downtown shifting north...or not

Photo: Seattle Times

The Seattle Times recently reported that Schnitzer's 818 Stewart was half-leased six months before completion, indicating that Seattle's office market is still going strong — and branching out north towards South Lake Union. Schnitzer is so keen on office, in fact, that it scrapped its plans for a condo at the site next door to 818 Stewart, opting for another office building instead. The article mentions several other projects nearing completion in the area, including:

• Touchstone's 520,000-square-foot West 8th project, at Eighth Avenue and Westlake Avenue.

• Schnitzer West's 660,000-square-foot 1918 Eighth building, on the same block as 818 Stewart.

• Vulcan's 2201 Westlake project, which will combine 300,000 square feet of office space with 135 condos.

But it turns out Seattle isn't completely immune to the global credit market downturn. News came out today that the Clise family was pulling its 13 acres in the Denny Triangle area off the market.

The property received 15 offers after 60 tours, according to Clise, and was in negotiations to sell the company to investors in Dubai, but the family decided to hold off until conditions in the credit markets improve.

When the family originally announced it was selling its holdings, they envisioned "a thriving world-class development on par with New York's Rockefeller Center or London's Canary Wharf" and the land and its development likely would exceed $7 billion in public and private investment."

Instead, for the next few years Denny Triangle will remain an urban wasteland, or as some might call it, the butthole of Seattle.

Office may still be in demand, but this will significantly limit downtown's northern migration.

Russell Investments to South Lake Union?

Enso on 2201 Westlake

Russell Investment Group, a large money manager based in downtown Tacoma, is looking to move to a new headquarters. Tacoma is doing all it can to keep this major employer (1000+) as part of its plans to transform the area into a major financial district.

The P-I reports that Russell has received development pitches from several cities, including Seattle's South Lake Union. Enso's 300,000 sq. ft. of office space, which has yet to be leased to my knowledge, appears to be a good fit for the investment company. This would be Vulcan — and South Lake Union's — first major foray into financial services, but after leasing of tech giants Amazon.com and Microsoft into what was originally meant to be a biotech hub, anything is possible.