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AAA of Washington

Project Outline

AAA of Washington (AAA) engaged the Kidder Mathews team to assist in underwriting their office headquarters while simultaneously searching for a new, high profile, and more accessible headquarters. Both projects would ideally be completed within a short amount of time from one another to help AAA relocate their employee base and save them from potential tax implications.

AAA had owned a 66,000 square foot office building in the Bellefield Office Park in Bellevue but several recent years of immense growth within the company, as well as a changing employee base, caused AAA to think beyond their existing location. The Bellefield Office Park had also witnessed some recent changes, most notably in ownership which transferred every building within the park, other than the two-story building owned by AAA, to one owner.

The Challenge

AAA required the security of a new site before they would consider a disposition of their existing headquarters. During the search, the Kidder Mathews team was required to emphasize AAA's desire to relocate even while they continued to operate in their existing building with no announced plans to sell. Further challenges arose in sourcing the right building. AAA had specific requirements that included a high visibility with transit options or inexpensive parking. These requirements, in addition to the building size AAA needed, minimized the potential field significantly. The Kidder Mathews team drove the requisite markets, called on every potential owner, and sourced potential development options. Eventually, the team uncovered a great, highly visible, off-market opportunity on I-90 at a reasonable price that would allow AAA future flexibility; this finding led to a full-blown, fast marketing process for their existing headquarters.

Kidder Mathews had quietly marketed AAA's headquarters though without much emphasis considering AAA would not be able to sell or move until they had sourced a solid option to move to. Upon the sourcing and purchase of the new site, AAA started the clock on their reverse exchange, which would allow them to shield tax consequences from an eventual sale of their headquarters building so long as they could sell in an allotted amount of time. Kidder Mathews needed to source a buyer for an eventual, empty, 66,000 square feet Class B office building in an office park that had its own challenges.

Our Approach

The Kidder Mathews team aggressively targeted several likely, strong buyers for the headquarters building while simultaneously uncovering several potential tenants for prospective buyers on the site.

Results

Kidder Mathews helped AAA identify several strong buyers and through competition created a probable sale environment. Despite numerous structural issues that arose during the due diligence process for both the building and the surrounding business park, Kidder Mathews helped AAA move toward a successful closing with a strong buyer all in time to satisfy AAA's reverse exchange requirements. AAA acquired a beautiful new building that met its requirements perfectly while disposing of its previous headquarters in a manner that protected the company from significant tax consequence.

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Services Provided

  • Corporate real estate strategy
  • Disposition services
  • Relocation and acquisition services