An investor with close ties to Bellevue mega-developer F. Kemper Freeman Jr. has bought one of downtown Tacoma’s historic retail cornerstones, the Columbia Bank Building.
But Howard McQuaid said his purchase of the 88,000-square-foot former department store at 1102 Broadway Plaza doesn’t indicate a shift in Kemper Development Co.’s Bellevue focus.
“It was a personal investment,” said McQuaid Tuesday. “There is no connection with Kemper Development Co.”
McQuaid is vice president of leasing and development for Kemper Development and Kemper Freeman’s son-in-law. Kemper Development created the Bellevue Square shopping center and the connected Lincoln Square and Bellevue Place mixed-use developments. The developer has recently announced a $1.2 billion project to add more hotel rooms, offices and retail spaces to its core developments in Bellevue.
McQuaid and his partners in Tacoma Broadway LLC bought the building because he saw potential in downtown Tacoma, particularly since the recent decision by State Farm Insurance Co. to bring hundreds of new employees downtown to fill two major Class A office structures, the Columbia Bank Center and the former Russell Investments headquarters.
Russell moved its headquarters to Seattle three years ago leaving its former headquarters empty and vacating part of the Columbia Bank Center on A Street.
The price McQuaid paid for the five-story Columbia Bank Building, $4.8 million, was a bargain relative to the price the most recent owner paid Columbia Bank in 2004 for the five-story structure at South 11th Street and Broadway Plaza. That owner, a limited liability corporation, 1102 Broadway LLC, paid $8.4 million for the building.
The building is listed on Pierce County tax rolls at an assessed value of $6.77 million. The purchase included not only the 108-year-old building but two adjacent surface parking lots.
The prior owner had lost the building in a foreclosure. A company hired by the bank that foreclosed had attempted to auction the building in February, but none of the bids met the bank’s requirements.
John Bauder of CBRE, representing the building owner, sold the building to McQuaid and his associates May 24. The sale documents first appeared in public records Monday.
McQuaid said the new owners will begin soon remodeling and updating the building.
The building wasn’t lacking maintenance, but it needs updating, he said. The structure was last remodeled 14 years ago.
“We’re talking with our tenants now and asking them what they’d like to see in improvements,” he said. Besides a Columbia Bank branch and some banking offices, major tenants include two well-known Tacoma law firms, McGavick Graves and Smith Alling. The building is now about 70 percent leased.
Before its life as an office building, the building was a retail anchor of downtown Tacoma.
Built in 1905 by Cornell Brothers contractors, the structure was initially the Fisher Department Store. The Bon Marche took over Fisher in 1952 renamed the store for itself. The Bon Marche moved to the Tacoma Mall more than 40 years ago. The Bon is now Macy’s.
The store was one of five Tacoma department store retailers. The others on Broadway were Rhodes immediately across 11th Street, Sears farther south on Broadway with J.C. Penney located between the Bon and Sears. Peoples Department Store was on Pacific Avenue at South 11th Street where Starbucks and Key Bank are now located.