The first phase of a new high-end multifamily development on the edge of downtown Kent has sold for $113 million to a Hawaii businessman and University of Washington benefactor.
King County on Friday posted two affidavits listing a limited liability company controlled by investor and philanthropist Jay Shidler, founder of Honolulu-based the Shidler Group as the new owner of the first phase of Ethos Apartments. The project, which will have 492 units when completed, is a joint venture of Auburn-based Landmark Development Group and HAL Real Estate of Seattle.
While $113 million is a big price for a multifamily asset in Kent, this is only the first phase of the deal.
Shidler will buy the second phase after it is finished next year, said Seattle multifamily broker Eli Hanacek, vice chairman at CBRE in Seattle. CBRE marketed Ethos, formerly called Marquee on Meeker.
Jay Shidler was not immediately available to comment, and HAL President Jonathan Manheim declined to comment.
Shidler buys commercial real estate assets and bifurcates the properties, separating the buildings from the land. The land is often placed in irrevocable trusts to benefit certain educational and social institutions.
To date Jay Shidler has donated $2.1 billion of ground lease-generated income streams to institutions, including the University of Washington School of Law, the University of Washington School of Medicine, the University of Hawaii Foundation, and the Shidler College of Business at the University of Hawaii, according to The Shidler Group's website.
"A ground lease is a very boring investment that has a predictable outcome," Shidler told the Business Journal in a 2018 interview. "It's basically a set-it-and-forget-it type of investment. You get a monthly check from the building owner, and if the building owner fails to make its rent payment, you get the building."
In the case of Ethos, Shidler owns both the buildings and the land. One affidavit shows he paid $24.86 million, apparently for the land, and the other lists a price of $88.14 million for the apartments.
The first phase, which is fully leased, consists of 120 units in a six-story building and 14 three-story buildings with a dozen apartments each. Phase II, with 204 units, consists of a six-story building and seven three-story buildings.
Ethos Apartments occupies 20 acres where the par-three section of the city-owned Riverbend Golf Complex operated at 2030 W. Meeker St. HAL and Landmark paid $10.5 million for the golf course, which the city sold to help eliminate its golf fund debt and pay for capital improvements to Riverbend's 18-hole course.
The developers also agreed to pay more than $2 million worth of improvements that are part of the city's "Meet Me on Meeker" project, which aims to create a sense of place with a pedestrian-friendly corridor running from the Green River to the central business district.
The general contractor is Landmark sister company FNW Inc. Studio Meng Strazzara is the architect and Sechrist Design Associates, Inc. is the interior designer. Other team members are landscape architect Thomas Rengstorf & Associates, civil engineer Navix. Real estate broker Matt Kemper of JLL managed the city's request-for-proposals process for the city.
Editor's note: This story has been updated to correct the number of units in Ethos Apartments.
Sale price
| Rank | Prior Rank | Transaction date |
|---|---|---|
1 | 1 | 2+U - 12/21/2020 |
2 | 2 | Amazon Blackfoot tower - 12/18/2020 |
3 | 3 | Tower 333 - 03/12/2020 |
