Kennedy Wilson Partners with Japanese Firms to Acquire Seattles The Danforth for $173 Million
Article: In a move that highlights the growing demand for high-rise apartment complexes in tech hubs on the West Coast, Kennedy Wilson, Kenedix Inc., and Hulic Co., Ltd. have acquired The Danforth, a 265-unit property in Seattle, for $173 million. The acquisition was announced last week by Kennedy Wilson's investment management platform and highlights the trend of return-to-office mandates from companies like Amazon spurring strong absorption in the city.
William McMorrow, chairman and CEO of the Beverly Hills, California-based real estate investment company, noted in the news release that The Danforth provides an opportunity to acquire a recently built community at a discount to replacement cost within an area experiencing limited new construction and strong absorption due to recent return-to-office initiatives from leading technology employers.
Kennedy Wilson partnered with Kenedix Inc. and Hulic Co., Ltd. to acquire The Danforth, which features one-, two-, and three-bedroom layouts and amenities such as a Studio Fit fitness center, rooftop solarium and dog run, resident lounge with shuffleboard and media center, full demonstration kitchen, and BBQ patio with multiple grills. The 16-story building was built in 2018 and is located in Seattle’s First Hill and Capitol Hill neighborhoods, which boast plentiful restaurants, nightlife, and large employers.
Kennedy Wilson has a 10% interest in the property, investing $6.6 million of equity. The firm will serve as the partnership's asset manager and will earn customary fees. With the acquisition of The Danforth, Kennedy Wilson now has more than 13,000 market-rate and affordable apartment units in the Pacific Northwest.
In addition to its partnership with Kenedix Inc. and Hulic Co., Ltd., Kennedy Wilson has also launched a new real estate investment platform with Tokyu Land US Corp., a subsidiary of large Japanese real estate developer Tokyu Land Corp., to provide preferred equity and mezzanine capital for multifamily and industrial sponsors in the U.S. The platform will target over $200 million in preferred equity investments and mezzanine loans to sponsors across multifamily and industrial projects nationwide, with a typical investment size ranging between $10 million and $50 million.
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