An empty Mercer Island office building on nearly six acres has been sold and is likely headed for redevelopment.
The property is four blocks from the future light rail station, making this a prime transit-oriented play.
Ryan Cos. and HAL Real Estate paid VEREIT $46.45 million for the 1980s-era building, which measures 146,750 square feet. Located at 3033 77th Ave. S.E., the building housed Farmers New World Insurance, which moved to Bellevue after more than six decades on the island.
Ryan Cos. declined to comment.
The Minneapolis-based company with a Bellevue office co-developed the transformational Kirkland Urban mixed-use development that Google bought for nearly $436 million last year.
Seattle-based HAL has invested in sizable mixed-use developments, including ones in Kent, Woodinville and Seattle.
Phoenix-based VEREIT bought the property in 2005 for $39.55 million, according to public records. Newmark Knight Frank marketed the property for sale.
With a vacancy rate of 28 percent, the Mercer Island submarket is the weakest in Seattle and the Eastside, according to NKF's Q1 report. But virtually all of the vacancy is composed of Farmers' former building. The company has moved to the Sunset North campus along Interstate 90 in Bellevue.
Farmers sold the building in 2005 and committed to a 15-year lease back.
The light rail station is scheduled to open in 2023. Sound Transit has suspended work on the station and most of its other projects through at least May 4 to limit construction workers' exposure to the novel coronavirus.
This is the region's second large transit-oriented development property to sell this month. Earlier a multifamily developer paid $12.3 million for a 1.2-acre property in Bellevue's Bel-Red corridor.
