The deal includes 94,800 sf leased directly from Vulcan and anadditional 32,000 sf subleased from Group Health Cooperative, whichlast month moved its headquarters into the remainder of thecomplex. Microsoft says the leasehold--its largest in Seattle--willhelp it attract and retain employees who don't like or don't needto make the bumper-to-bumper cross-lake commute to companyheadquarters in Redmond, WA.

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Local brokers tell GlobeSt.com that the asking lease rate forspace in the building was $40 per sf. The rate, which includes $10per sf in operating expenses, assumed a five-year lease and a$30-per-sf tenant improvement allowance. The negotiated lease rateon the transaction was not released by Vulcan or Microsoft. RayAttisha of CB Richard Ellis had the leasing assignment; he was notimmediately available Thursday afternoon for comment.

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Located on the city's soon-to-be-operating streetcar line, theproject spans a full city block bordered at Westlake and Terryavenues and includes 40,000 sf of street-level-floor retail. Thedevelopment was designed to achieve a LEED Gold rating from USGreen Building Council. Callison designed the complex and GLY wasthe general contractor.

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About 400 Microsoft employees, including its Online ServicesBusiness, will occupy the top four floors of the six-story Westbuilding starting in March 2008. The building also will providetemporary work space for 150 Microsoft employees who need toconduct meetings in Seattle or avoid the rush-hour commute tocompany headquarters.

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Approximately 36,000 of Microsoft's 80,000 employees worldwidework in the Puget Sound area. In February 2006, Microsoft announcedthat it would accelerate campus development plans, expanding itsRedmond, Wash., campus by one-third of its current size, making itone of the world's largest corporate campuses. The Seattleexpansion is in addition to the company's previous plans, which arein progress and on schedule to be completed in 2009.

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Microsoft also has been leasing additional space on theEastside. In May, it inked long-term leases for the entirety of twounder-construction office developments here totaling 1.3 millionsf, the 740,000-sf Bravern Office Commons next to MeydenbauerCenter in Downtown Bellevue and the 600,000-sf Advanta OfficeCommons adjacent to Interstate 90 in southeast Bellevue. In 2006,the company leased320,000 sf at Kemper Development's newest Downtowndevelopment Lincoln Square and another 87,000 sf atEastpointe Corporate Center.

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Vulcan owns approximately 60 acres in South Lake Union that ithas been actively redeveloping for several years. To date, thecompany has delivered eight new commercial, residential andmixed-use projects in South Lake Union totaling approximately 1.4million sf. An additional 1.4 million sf is currently underconstruction and 1.5 million sf is in the pre-development pipeline.Expected to total 10 million sf upon completion, it is said to beone of the largest urban revitalization efforts in the U.S.

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