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Fri March 23, 2012
Seattle's Smith Tower sold for nearly $37 million
Seattle's historic Smith Tower was sold Friday for nearly $37 million in a foreclosure auction on the steps of the King County Administration Building.
The buyer is CBRE Capital of New York, which acquired the delinquent mortgage last fall after Chicago-based Walton Street Capital defaulted on $43 million in loans. When it bought the building in 2006 it intended to convert the tower into condos, but the condo market collapsed in the recession.
Seattle's very first skyscraper – the Smith Tower – will be put on the auction block today.
The 42-floor building is dwarfed by today's modern buildings like the Columbia tower. But for 50 years it was the tallest building west of the Mississippi River.
As evocative as it is exotic, the Chinese Room in the Smith Tower is one of the more famous spaces in the city, with sweeping views of the sound, the Space needle and Mt. Rainier. It's still filled with intricate carvings sent from the Empress of China as a way of thanking L.C. Smith for the typewriter he sent her in the early 1900's.
But that was another time. In recent years, the iconic office building with the lighted blue globe atop it, has been plagued with 70 percent vacancy.
Life at the top
Petra Franklin, a public television producer for the Artist Toolbox, lives at the top with her two kids. Her penthouse, which starts on the 37th floor, is the only residential space in the building.
"It is sad to have so many empty floors. My oldest used to deliver the mail and got to know many of the different companies in the building, and we don't have any companies in the building now."
She has a genuine love for the place and hopes that she will be able continue to rent the penthouse.
What to do with it?
The Smith Tower is set to go on the auction block after its owner defaulted on loans totaling more than $42 million, which ultimately led to foreclosure. Exactly why it's vacant is debatable. It could be bad management, non-negotiable rents or a scrapped plan to turn the offices into luxury condos.
Richard Hagar is a Seattle- area real estate appraiser. He says with the residential market turning around, the new owner might be wise to consider making it a mixed-use building.
"I'd rather have the option of selling some of those units as condominiums and using some of those units as a hotel or as an office space because you know, you've got those nice elevators all the marble and things like that. It’s an interesting way if you can make it work for offices and tenants."
Whoever the new owner turns out to be, Hagar says they’re likely to be out-of-towners with deep pockets. And in case you're interested in entering a bid for this historic landmark, be prepared to bring a cashier's check to the steps of the King County Administration building.