Mortgage Banking

It was announced today that Liberty Mutual is acquiring Safeco Corp. What does that have to do with commercial real estate in Seattle? Actually, a lot. Safeco recently sold its headquarters near the University of Washington to move its operations to downtown Seattle. The company leased 424,000 square feet in the CBD. With such a large chunk of the available market leased at once, downtown office vacancies sank, lease rates rose and several new office developments commenced construction. The opposite will likely happen if Liberty Mutual decides to downsize some or all of Safeco’s space. So far, there has been no word on layoffs; hopefully that will not happen.

Other interesting notes about Safeco:

• The Mariners play at Safeco Field. I would imagine that the stadium would not change its name.
• Spun off Symetra Financial in 2004. (Full Disclosure: Symetra is one of the lenders we represent.)
• Safeco’s downtown headquarters, Safeco Plaza, is locally known as ‘the box the Space Needle came in’.