The project was to attempt to reduce client’s rental rate and occupancy costs mid-term in a 20 year lease in downtown Seattle. The client was the anchor tenant in the building with naming rights as well. The existing lease called for a “market rate adjustment” but was vague as to methodology in determining such figures. Additionally, there were no comparable deals completed in the marketplace other than several large transactions in the mid/high-rise portion of the building at substantially higher rental rates than what the client was paying at the time.
Kidder Mathews engaged the help of four appraisal firms to assist in establishing a group of generally accepted comparable Class A buildings in the Seattle CBD. The firm engaged three other major landlords to provide information in order to define a “blended” rental rate and concession package for other significant transactions (office, retail and storage) in that focus group of buildings.