Office condos–real estate purchased (instead of leased) for business use–are gaining popularity in Seattle according to a Seattle PI article by Dan Richman. These properties are already popular in cities like Phoenix and Grand Rapids, but have yet to catch on in major urban areas like San Francisco and New York. Maybe Seattle’s embrace can help change that.
While businesses sacrifice some flexibility by purchasing space instead of leasing it, like easily moving offices or up-sizing current spaces, the perks can more than make up for it. According to the article, “… condos let owners build equity, offer significant tax benefits, including amortization and depreciation, and eliminate lease negotiations and the chance of being displaced by a building’s sale.”
To my mind, purchasing an office condo is much like a renter purchasing a home: it’s more expensive up front, there’s a bit more responsibility, but in the long term, the equity and security of owning is usually worth the effort. Office condos aren’t for every business, but for those that plan on staying put for the foreseeable future, they may make more sense then the traditional lease.
Some local office condos include: The Ship Canal Office Center (Fremont); Salmon Bay Landing (Ballard); Terminal Sales Building (Downtown); Elmer Nordstrom Medical Tower (First Hill); the Ashbury Building (Queen Anne); the Banner Building (Belltown); Canal Station (Ballard); Linbrook Office Park (Bellevue); and The Ward House on Capitol Hill, Seattle’s oldest building (Note: the PI Article reported the address as 250 E. Denny Way; I’m fairly sure they meant 520 E. Denny Way.)