Nordstrom Builds Up In Downtown

CONSTRUCTION HAS STARTED on the retailer's corporate headquarters on Olive Way. The high-rise will house Nordstrom workers now scattered throughout downtown Seattle.

Last year came the Italian marble floors, saltwater fish tanks in the children's department, a midnight move-in and a widely attended grand opening.

Now, a year after Nordstrom opened its new flagship store downtown, the company and Seattle-based Clise Properties have started construction of a $100 million, 24-story office building to house most of Nordstrom's 2,500 corporate employees.

The development at 700 Olive Way will include 20,000 square feet of retail space.

Clise and Nordstrom also are investing $1.25 million in a five-story, 65-unit apartment development at Eighth Avenue and Stewart Street, adjacent to the office tower and the Marsh & McLennan Building.

The nonprofit Housing Resources Group of Seattle will construct, own and manage the property, billed as affordable housing. Nordstrom and Clise were founding members of the Housing Resources Group, which was formed in 1980.

Clise, a property-management and real-estate-development company, will hold a 51 percent stake in the tower and act as managing partner. Nordstrom will own 49 percent.

Seattle's Sellen Construction and Callison Architecture are chief contractors. The tower is expected to be completed in two years.

Nordstrom has leased 400,000 square feet of the building's 524,000 square feet to house its Seattle-based employees who now are in six downtown locations.

Al Clise, president and chief executive officer of Clise Properties, called the deal a win-win for both companies.

It will be more efficient for Nordstrom to consolidate, he said. "They can project occupancy costs better," Clise said. "It works very well for them and for us.

"We like to build office buildings, and we like to partner with companies like Nordstrom," he said. "They will be a great tenant."

Clise Properties will market the remaining 100,000 square feet of office space within the next few months. The company isn't worried about finding tenants because the vacancy rate for downtown offices is less than 5 percent.

Downtown office buildings coming on the market next year are leasing for up to $40 a square foot a year, compared with about $30 last year.

"The market is terrific and has been for the last four to five years," Clise said. "You're not seeing yet an overbuilt situation."

Tamra Fitzpatrick's phone message number is 206-464-8981. Her e-mail address is: tfitzpatrick@seattletimes.com