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BELLEVUE, WA-Two local real estate veterans have acquired the former Leavitt Building here with plans to renovate and lease-up the property. The five-story, 68,000-sf building is located adjacent to Interstate 405 on 116th Avenue SE at Main Street, which is on the edge of the Downtown core. The sale price was $15.9 million.

The new ownership is a joint venture of Mark Weed, president of Egis Real Estate Services, and Michael Barnes, a former institutional investment manager. The seller is OB City Hall Partners LLC, an entity controlled by Michael O’Brien, the Mercer Island-based owner of several auto dealerships including Lexus of Bellevue and Aston Martin of Seattle.

O’Brien acquired the building in 2003 as part of a larger 10.7-acre assemblage that also includes the old City Hall and Police Annex buildings. O’Brien paid $24.7 million for the overall site and as part of the deal the city leased back the City Hall building until recently, when it moved to another building. O’Brien, who could not be reached for comment, reportedly plans to relocate Lexus of Bellevue to the site.

Weed tells GlobeSt.com that the Leavitt Building is currently 10% leased to two tenants, including Donald Leavitt, who developed the building in 1979. The plan is to immediately begin a complete refurbishment and rebranding of the property, he says. Egis will provide development oversite. At least $2 million will be invested in the renovation and lease-up, Weed says.

Up to 60,000-sf is available for lease; the triple-net asking rate is $26 per sf per year. Weed says the pro forma calls for lease-up within a year. He declined to discuss the expected cap rate on the investment.

Weed has been involved in other Bellevue developments, including Skyline Tower, City Center (formerly Koll Center) and other Eastside properties in Bellefield, Overlake, and along the I-90 corridor.

Keith Honsberger and Dan Mathews of GVA Kidder Mathews brokered the acquisition. The duo also has the leasing assignment.

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