Amazon’s HQ in the South Lake Union neighborhood.

This just in: Amazon.com is purchasing its existing Seattle headquarters campus in South Lake Union from Paul Allen’s Vulcan Inc. for more than $1.1 billion, according to a regulatory filing just made public.

From the filing …

The Company entered into purchase and sale agreements to acquire 11 buildings comprising 1.8 million square feet of our currently leased corporate office space in Seattle, Washington, for approximately $1.16 billion. Subject to satisfaction of customary closing conditions, the Company expects to close the purchase in Q4 2012, and has made a non-refundable deposit of approximately $23 million, which will increase to approximately $51 million on October 22 and will be forfeited if we do not close the transaction in Q4 2012.

As noted in the filing, Amazon currently leases the buildings. Vulcan’s real estate arm announced in August that it was putting the 1.8-million-square-foot campus up for sale to rebalance its holdings away from office properties. Amazon was considered a possible buyer at the time, but Vulcan was also shopping the property to pension funds, institutional investors and others.

With the deal, Amazon would go from a major Seattle office tenant to a significant property owner. Amazon is also expected to purchase the three-block tract just north of downtown Seattle where the company plans to build three new office towers.

The deal will also be a milestone for Allen, the Microsoft co-founder, whose company spent years accumulating land and redeveloping large swaths of the South Lake Union neighborhood.

Update, 2:40 p.m.: Vulcan just confirmed the deal in a news release. Here’s the full text …

Vulcan Signs Agreement with Amazon for Sale of 11 Buildings in South Lake Union 

What: Vulcan Real Estate has signed a purchase and sale agreement with Amazon for 11 buildings comprising 1.8 million square feet in the heart of Seattle’s burgeoning South Lake Union neighborhood.  The buildings are currently leased by Amazon as part of its corporate headquarters and Amazon plans to acquire them from Vulcan for $1.16 billion.  The deal is expected to close in Q4 2012.

The Amazon campus is at the center of a newly revitalized neighborhood at the north end of downtown Seattle.  The South Lake Union neighborhood – once better known for warehouses and light industrial operations – is now home to Amazon, global health organizations, multifamily residential communities and a thriving retail and restaurant core.

“We are truly excited that Amazon is making this long-term commitment to the South Lake Union community,” said Ada M. Healey, vice president of real estate for Vulcan Inc.  “We know they will be excellent stewards of this property and will continue to play a vital role in revitalizing South Lake Union and creating a thriving urban neighborhood in the heart of Seattle’s urban core.”

Vulcan plans to reinvest earnings from the sale into continued real estate investments, including the redevelopment of the remaining 30 acres of property it owns in the South Lake Union neighborhood.  Vulcan currently has both residential and commercial projects in development in South Lake Union, including Stack House, a 278-unit apartment complex, and a 375,000 square foot project that it is developing for Amazon.  The company continues to invest in South Lake Union as a primary component of its growth strategy.

Photo by bytesrc, via Flickr.

Comments

  • Guest

    Congrats to Vulcan on a successful exit! South Lake Union is growing strong.

  • http://www.postlinearity.com gregorylent

    and artists move even farther away from downtown seattle

  • crowded

    Maybe there will be enough money from that transaction to build or accelerate existing plans for a public school nearby. Amazon kids have caused tremendous overcrowding in QA schools. Making things worse, Amazon parent donations arr matched 0:1 (vs Biill and Melinda Gates, Expedia, Starbucks, Adobe, and Microsoft).

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