New firm Redco Development has entered the Seattle market with a splash. In two sales King County recorded on Wednesday, the Bay Area investor has purchased two older industrial properties for about $30.75 million. They are:
• The Nordic Building, at 548 First Ave. S. in Pioneer Square, which sold for $8.75 million. The seller was Nordic Cold Storage, which occupies and has owned the property for decades. The county says it has 68,700 rentable square feet. It was constructed 1904 as a cold storage and meat smoking plant, back when there were railroad tracks on both sides of the building. The deal was worth about $127 per square foot.
• The Hardware Specialty Co. property at 60 S. Spokane St. in Sodo, which sold for $22 million. The seller was also the occupant, which purchased the property in 1996 for $3.5 million. The 4.5-acre property, just north of the Spokane Street Viaduct, has multiple attached buildings with around 85,000 square feet. It was developed in 1941. The deal was worth around $259 per square foot.
Brokers were not announced in what Redco says were off-market transactions. Redco says it will lease back both properties to the sellers for a few years. In both deals, using LLCs, its financial partner was Bain Capital Real Estate of Boston.
Redco, founded earlier this year by Chris and Jason Freise, is named for their grandfather's old masonry business: Robert E. Daniels Co. Masonry, aka Redco Masonry.
Chris Freise, who once worked here with Vulcan Real Estate, was until recently with Lift Partners of San Francisco, which has purchased several old industrial properties in our region, then leased them back to the sellers or occupants. Redco seems to be following a similar investment model. It lists nine properties in its portfolio, mostly in California.
While no redevelopment plans have been filed yet for the Nordic Building, Redco says its “business plan is to (use) cash flow as a cold storage building while working on redevelopment plans as office or residential with additional floors added similar to adjacent properties.” Renderings on its website show just that.
Also addressed at 547 Occidental Ave. S., the four-story midblock building is in the Pioneer Square Preservation District, just west of CenturyLink Field. Any additions would have to be approved by the preservation board.
A past example of such an addition is the Reedo Building immediately to its north, now home to Elysian Fields, where a bilevel fourth floor with mezzanines was added in circa 2006 by past owner Greg Smith.
On the west side of the Nordic Building is the Triangle Tavern (officially called Seattle's Historic Triangle Pub); and west of that the viaduct is nearly gone, greatly increasing the value of the Nordic Building.
Including the Nordic Building's basement, which is entirely refrigerated and features a giant compressor wheel, the building totals around 83,400 square feet.
Family-owned Hardware Specialty Co. was founded in 1947. It specializes in maritime products. No redevelopment plans have been filed there. But, as with Nordic Cold Storage, Redco's website does show a possible future plan. That total redevelopment could yield a large four-story warehouse of the kind so coveted by the logistics industry.