Boeing is looking to lease more than a half million square feet of office space in Bothell and the Interstate 90 corridor by August, according to people familiar with the matter.
Such a move would be “game changing” for the Eastside office market, said one industry source.
The company plans to knock down the office buildings at the northeast corner of its Everett assembly plant to make room to build the giant wing of the 777X jet. It needs office space to accommodate the displaced engineers and other workers in those buildings.
Real-estate industry sources say Boeing is considering leasing between 150,000 and 250,000 square feet in the Interstate 90 corridor and as much as 300,000 square feet in Bothell.
Assuming an average 180 square feet per employee, the leased office space could theoretically accommodate 2,500 to 3,000 workers.
A Boeing spokeswoman declined to comment, saying only that the company “continually evaluates available properties … to meet Boeing’s evolving business needs.”
At the end of 2013, the I-90 corridor and Bothell posted the highest vacancy rates on the Eastside, with 18.5 percent and 16.8 percent vacancy, respectively, according to a market report by the Broderick Group, a local commercial real-estate brokerage.
T-Mobile and Verizon moved out of nearly 250,000 square feet along the I-90 corridor last year, adding to the area’s woes. A handful of buildings there have more than 100,000 square feet of available space, including Sunset North Building 5 and Newport Tower, according to the Broderick Group’s report.
Boeing taking 250,000 square feet would single-handedly drop the submarket’s 18 percent vacancy rate to about 12 percent.
“The market on I-90 has been deteriorating with no real solid demand,” said the source. If Boeing inks a deal, “it absolutely stabilizes the market.”
Similarly in Bothell, if Boeing leases 300,000 square feet, that would knock the vacancy rate down well below 10 percent, considered the tilting point in the balance of power between landlords and tenants.
The aerospace giant has looked at Bothell office space in buildings along Monte Villa Parkway and in Canyon Park, both east of Interstate 405 and between state routes 522 and 527, industry sources say.
Along Monte Villa Parkway, there’s at least 210,000 square feet of vacant office space available across different buildings.
Canyon Park, which is owned by Arden Realty, a subsidiary of GE Capital Real Estate, offers at least 160,000 square feet across several buildings as well.
If Boeing were to lease as much as 300,000 square feet in Bothell, there would be no vacant spaces larger than 20,000 square feet, said one real-estate industry source.
