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Safeway sells 105 acres in Auburn for $144.5M

A Safeway distribution center at 2921 C St. S.W. in Auburn has sold for a little over $144.5 million, according to King County records.

The seller was Safeway, which acquired the property in 2002 for $29 million.

The buyer was RAR2 3520 Pacific Ave LLC, which is associated with Deutsche Asset & Wealth Management (formerly known as RREEF America REIT II) of Chicago and San Francisco.

Brokers were not announced.

The 105-acre center, apparently developed in 2004, has about half a million square feet in nine buildings. Part of the property is wetlands that can’t be developed, but not all details could be confirmed before deadline.

King County records also put the property in Algona. It’s a little east of Highway 167, and north of the White River.

Nationally, Safeway and parent company Albertsons have continued to sell off stores. Some are being redeveloped with new stores and apartments on top; some are simply being leased back.

Large distribution centers are potentially much more valuable. For example, Prologis paid Sabey $136 million in 2016 for the Associated Grocers site near Boeing Field, which is being redeveloped as Emerald Gateway and will serve a very different class of logistics customers.

Deutsche Asset/RREEF has bought and sold various properties in the Northwest. Two years ago it sold the Gateway Corporate Center in Tukwila to BECU for $78 million. The firm is also known as DWS.

By BRIAN MILLER

https://www.djc.com/news/re/12117537.html
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Gonzaga’s $48M science building gets OK for site on lake in Spokane

SPOKANE — Gonzaga University has gotten permission from the city to build a $48 million science and engineering building near the campus’ Arthur Lake, but the university is still raising the funds to pay for construction.

Brian McGinn, the city’s hearing examiner, approved the project, allowing the three-story building to be constructed within 200 feet of the lakeshore.

The project required his permission under the city’s shorelines law. A final determination regarding the shoreline rules will be made by the state Department of Ecology.

The 80,000-square-foot building, called the Integrated Science and Engineering Center, is part of a building boom on campus. The university recently constructed the $24 million Volkar Center for Athletic Achievement and the $13 million Della Strada Jesuit Community residential building. Work on the $30 million, 57,000-square-foot Myrtle Woldson Performing Arts Center is anticipated to be complete next year.

Gonzaga President Thayne McCulloh said the university hoped to raise half of the nearly $50 million needed for the new science center. The other half will come from the university’s cash reserves and restructuring debt.

“We are actively in the process of fundraising for the center,” he said. “We’re still working towards it.”

In November, the university said it surpassed its two-year fundraising goal by bringing in $286 million. McCulloh said the work to raise more money for construction and scholarships will continue through April or May.

The new science building will be an interdisciplinary space that brings together faculty from the university’s College of Arts and Sciences and the School of Engineering and Applied Sciences. A range of subjects will be taught, and ongoing student research projects will be on display.

McCulloh said the idea was to develop programs beyond the “bedrock” disciplines currently offered at Gonzaga. In addition to mechanical and electrical engineering, students would be able to study bioinfomatics and materials science.

“We’re seeing information that is critical to research in biosciences that really is derived from large, large amounts of data,” he said, referring to bioinfomatics, which collects and analyzes complex biological data such as genetic codes. “We are looking at ways in which a discipline like biology can interface with engineering to look at micro-technologies, especially in the health sciences.”

The building will have four types of learning spaces: general classrooms, project areas, teaching labs and research spaces, according to Portland’s SRG Partnership, which helped design the project.

It will have a central gathering space on the ground level. McCulloh called it a “hub of innovation” and a “dedicated space for the incubation of ideas.”

The science center isn’t directly linked with the growth in the nearby University District, but is related programmatically, McCulloh said.

Earlier this month, Eastern Washington University announced plans to move three degree programs and around 1,000 students from its Cheney campus to a building along East Sprague Avenue on the south side of the University District that it said allows for growth in its science and engineering departments.

“We obviously do what we’re doing in close relationship not only with Avista but with our colleagues at WSU and other institutions, developing things with an intention to be a partner with what is being developed and offered,” McCulloh said.

Gonzaga’s new building will connect to the existing Paccar building to the east and, via skywalk, to Hughes Hall to the north.

The land is zoned for high density residential. McGinn, the hearing examiner, said Gonzaga’s plans for the science center are “allowed outright,” and required no rezoning.

As part of the decision, Gonzaga will have to restore or enhance the shoreline, and update the Habitat Management Plan for Arthur Lake. McGinn noted that information Gonzaga provided as part of the State Environmental Policy Act showed that the “project will not have significant impacts on the environment or the surrounding properties.”

McGinn also noted that public access to the lake won’t be affected, since the paved trail on its southern front won’t be changed. The lake is wholly owned by the university.

Lake Arthur wasn’t always a lake. For many years, it was an inlet of the Spokane River used to store logs for the McGoldrick Lumber Co., which bought a mill on the site in 1906.

After a fire in 1945 destroyed the plant, Gonzaga purchased the land and closed off the inlet with a dam made of rocks, creating the lake.

By NICHOLAS DESHAIS
The Spokesman-Review

http://www.djc.com/news/co/12108574.html

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Mercer Island store sold for $8.6M

MERCER ISLAND — The New Seasons grocery store property at 2755 77th Ave. S.E. has sold for $8.6 million, according to King County, which recorded the sale in late October.

The sellers were Fab Five LLC and a family trust, which had owned the property for several decades.

The buyer was Graham RE1 LLC, which is associated with Mercer Island investor Justin Graham.

The store was developed in 1977 on 2.7 acres, and has about 37,000 square feet, plus a large parking lot. It was remodeled last year, after New Seasons acquired the ground lease and store—but not the land—from Albertsons. It was during that same period in 2015 when Albertsons and Safeway merged, and Haggen took over several locations from the combined grocery chain.

http://www.djc.com/news/re/12106051.html

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Grocery industry reacting to Amazon

By JOSEPH PISANI
AP Business Writer

NEW YORK — Donna Brown visited a Whole Foods for the first time in at least five months with one goal: see how much Amazon had cut prices. She did buy almond milk, yogurt and lunch meat, but doesn’t plan to quit her usual grocers, Walmart and HEB, where she says she finds bigger selections and lower prices.

“I am a comparison shopper,” says Brown, a part-time administrative assistant in Austin, Texas.

Amazon made a splash right away as the new owner of Whole Foods, slashing prices quickly on baby kale, avocados and ground beef. That attracted some customers, but whether shoppers who’ve found cheaper alternatives will come back, or those who never visited will give Whole Foods a try, may help determine what kind of effect the blockbuster deal has on how people get their groceries.

Shoppers who talked with The Associated Press this week say what they want most of all is lower prices and one-stop shopping.

Stores are competing fiercely to attract them. Traditional supermarket chain Kroger stressed earlier this year that it does not plan to “lose on price.” Target is spending billions to remodel its stores and highlight its grocery section. Newer entrants from Europe, such as discounters Aldi and Lidl, are opening more U.S. stores. And Walmart, the country’s largest grocer, is making it easier for customers to order groceries online and pick them up at the store.

Some shoppers say they’re concerned with Amazon’s growing power, while others said the nearest Whole Foods was too far away to be a frequent stop. And while other supermarkets have added aisles of organic and natural products to mimic Whole Foods, the chain still doesn’t sell some consumer favorites like Diet Coke, Bounty towels or other brands people want.

Brown said the “chichi organic stuff” at Whole Foods can’t replace her Clairol hair color or allergy medicine.

“I’m going to gravitate to Walmart,” she said.

Gail Johnson, a pharmacy technician from Cleveland, has never been to a Whole Foods and doesn’t plan to, even after hearing about the price cuts.

“Organic food is real high expensive, but here there’s regular food,” Johnson said while browsing a movie rental kiosk near the Walmart entrance. “They’ve got movies, liquor, beer, ice cream; anything you want.”

Analysts at Citi and JPMorgan Chase say they do expect the price cuts at Whole Foods to make the chain more competitive with rivals and attract more shoppers. And Amazon said the moves last week were just the beginning. It expects to lower prices on more items and will offer discounts to members of its $99-a-year Prime program. More price cuts may also help shake the grocer’s “Whole Paycheck” image.

Knocking a few cents off some items won’t attract new customers since Whole Foods is known to be expensive, said Carol Major, a retired dental assistant who was sitting outside a Trader Joe’s in Philadelphia with two shopping bags.

She likes both stores, but “people who shop (at Whole Foods) aren’t too worried about prices,” she said.

Rachel Manders, a stay-at-home mom who was at a Whole Foods in University Heights, Ohio, likes to stock up on produce there but goes elsewhere for other goods.

“I didn’t see everything discounted,” Manders said. “I got avocados, tomatoes, at a substantial cheaper price than yesterday, so I was happy.”

Some Whole Foods fans were worried about Amazon’s growing influence in their lives.

“It’s going to make me want to go to Whole Foods less because they’re already a corporation, but now they’re part of Amazon, which already owns so many other things,” said Hillary Minor, who recently moved to Seattle, where Amazon.com Inc. is based. “It just seems like it’s taking over.”

U.S. regulators didn’t have a problem with the Amazon and Whole Foods deal, giving the e-commerce giant the go-head last week to acquire Whole Foods for nearly $14 billion. Whole Foods has about 460 stores in the U.S., far fewer than Kroger Co.’s 2,800 locations and Wal-Mart Stores Inc.’s more than 4,000.

Joshua Cano of Seattle said he’ll stick to Quality Food Centers, a supermarket chain owned by Kroger, even though he says Whole Foods has high-quality food.

“I can come here,” he said, “and spend half the cost and get twice as much food.”

http://www.djc.com/news/ae/12104090.html