New Seattle 'micro-hub campus' stretches Fremont office submarket south of the ship canal

The Fremont office submarket in Seattle is expanding as work on an adaptive reuse project south of the Lake Washington Ship Canal nears completion.

Office space in Fremont – home to the headquarters of Tableau Software as well as offices for Google and Adobe – is a hot commodity. North of the ship canal, a new office building is filling up while a 1980s-era building sold last month for 88% more than it did six years prior.

Fremont Crossing, the adaptive reuse project by Seattle-based Pastakia + Associates, will test whether tenants will migrate to the other side of the canal.

The project, 316 S. Florentia St., is where Bleitz Funeral Home operated in a 1921 Tudor-style building until several years ago. It has been repurposed into office space next to a new four-story building.

Pastakia bills Fremont Crossing as a "micro-hub campus" that lends itself to the social distancing that the Covid-19 era demands. It has over 60,000 square feet of office space and 12,000 square feet of outdoor space on a rooftop deck and two courtyards.

None of the space has been leased, though the company said it is talking to "a few" prospects.

The annual asking rate is between $45 and $50 a square foot, plus the cost of real estate taxes, insurance and maintenance. Newmark Knight Frank (NKF) has the listing.

Redeveloping another former Seattle mortuary presented challenges for attorney Jerry Everard and other real estate investors. They bought the Butterworth Funeral Home on Capitol Hill in 2001 and turned it into office space for the law firm Groff Murphy, where today Everard is of counsel.

He previously told the Business Journal a bank declined to finance the project because the board thought it would be bad luck. Everard hired someone to perform exorcisms to assuage the unease of some employees of the law firm, which still operates in the building.

In a statement to the Business Journal company founder Tejal Pastakia said the funeral home building "naturally lent itself to adaptive reuse as new commercial office space due to its size and layout." She added the project team "sought to preserve the structural integrity of the 1921 building while renovating the interior for Class-A office use."

Two years ago Pastakia + Associates paid $8 million for the redevelopment project.

Fremont is part of the larger Ballard/University District submarket, where 6.3% of the office space is vacant, according to NKF.

HAL Real Estate and Pacifica Capital Investments are Pastakia's capital partners on the project, and City National Bank provided construction financing. Pastakia said the total development cost is between $40 million and $50 million.

SKB Architects designed Fremont Crossing, DCI did the civil engineering and Foushee is the general contractor. Stephen C. Grey & Associates will manage the property.