Seattle sells ‘Mercer Mega Block’ in South Lake Union for $143.5 million

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SEATTLE -- The city of Seattle has sold a 2.86-acre site in South Lake Union known as the "Mercer Mega Block" for a record $143.5 million, with much of the money going to affordable housing and related services.

Mayor Jenny Durkan announced Tuesday that Alexandria Real Estate Equities, Inc., is prepared to buy the three parcels in the most expensive sale of city-owned property in history.

Here's what Seattle will get from the sale, according to a release from Durkan's office:

  • $143.5 million cash at closing, including a $5 million contribution to support strategies that address homelessness in Seattle
  • 175 units of affordable housing on-site
  • A new 30,000 square-foot community center on-site that will be run  by Seattle Parks & Recreation with rent waived for up to 40 years
  • Transportation improvements, including the extension of 8th Avenue as a pedestrian right-of-way through the site between Mercer and Roy, and the extension of the two-way protected bike lane on the north side of Mercer Street between 9th Avenue and Dexter.

Of the $143.5 million in cash, Durkan proposes the following:

  • $78 million in housing usesincluding:
    • $57.2 million to address displacement
    • $15 million to increase investments in permanently affordable homeownership
    • $6 million in loans for property owners who want to build backyard cottages and in-law apartments for low- and middle-income homeowners.
  • $16.7 million to support new and planned transportation projects.

“This is a generational opportunity for Seattle,” Durkan said. “Cities our size rarely get the chance to take an underused property we own and make bold investments to create jobs, create more affordable and mixed-income housing throughout the city, and build more safe transportation connections. I believe that years from now, people will look back at this chance and say we seized an incredible opportunity to make our City better by reinvesting the proceeds directly in housing across Seattle."

According to Crosscut, Alexandria Real Estate is publicly traded and has properties in New York, San Francisco, Boston, North Carolina and other areas. In Seattle, the company owns or is building 1.5 million square feet of space for Fred Hutchison Cancer Research Center, the University of Washington, Bristol-Myers Squibb and more.

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