Plaza Yarrow Bay

KIRKLAND, WA-Kilroy Realty Corp. of Los Angeles has acquired the 276,000-square-foot Plaza Yarrow Bay office campus, a site entitled for 80,000 square feet of additional development, from Seattle-based Hal Real Estate Investments Inc. for $100.3 million. The sale was negotiated on behalf of Kilroy by SVP Craig Wilson and first vice president Steve Sutherland of the CBRE Capital Markets Private Client Group of Seattle/Bellevue, who note that it is the largest office sale this year in the Puget Sound region.

The deal completes a purchase and sale agreement that Kilroy entered on Jan. 31, according to a public filing by the REIT. It listed the addresses of the buildings as 10210, 10220 and 10230 NE Points Dr. and 3933 Lake Washington Blvd. NE in Kirkland. The purchase price consists of approximately $70 million in cash and the assumption of approximately $30 million in mortgage debt with an interest rate of 4.94% per year and a maturity date of April 15, 2015, according to the Kilroy filing.

Project Aerial View

The Plaza Yarrow Bay campus comprises four class A multi-tenant buildings, plus the site that is entitled for 80,000 square feet and could add a fifth building. Wilson and Sutherland describe the site as a strategic location because it is at the confluence of Interstate I-405, SR-520 and Lake Washington Boulevard in Kirkland, convenient to downtowns in Seattle, Bellevue and Redmond, South Lake Union and the University of Washington. The site offers views of Lake Washington, and a 52-acre nature preserve surrounds the property.

The PYB campus is Kilroy’s second purchase in the Seattle area. Late last year the REIT paid $46 million for the 122,000-square-foot Overlake Development Center in Redmond, which is occupied by a single tenant. In the PYB campus sale, Hal Real Estate did not have broker representation.