Item No.               10a supp
Date of Meeting          May 25, 2021

Terminal 106 Ground Lease Approval

Action Requested
Request Commission authorization for the Executive
Director to execute the Ground Lease Agreement and
associated easement for the redevelopment of
Terminal 106 between Trammell Crow and The Port
of Seattle.

2

Redevelopment Opportunity: Terminal 106
Property Details
31.23 Acres
533,910 sf dilapidated
Redevelopment Site               warehouse
ConGlobal leases
property to west and
south of existing
W-2                              warehouse
Port of Seattle and
Conglobal                                                NWSA developing
offices for Customs
and Border Patrol in
building W-2
A portion of W-2 also
leased to LIHI
3

Competitive RFP Demonstrates Strong Market
"The Puget Sound region is
Port sent RFP to 30+ qualified real estate developers         absolutely on fire relative to
industrial logistics space right
Seven developers submitted development proposals         now."
Trammell Crow Company ("TCC") selected as                                         CBRE
preferred developer.
TCC has developed or acquired more than 2,600 buildings        "Industrial real estate demand
valued at more than $60 billion and over 565 million square         on the rise in the U.S."
feet.                                                                                                   JLL
TCC developed the Port's Des Moines Creek North
property                                                     "In most markets, more than
half of the product under
construction is preleased"
Transwestern


4

Port of Seattle Partners with Trammell Crow to
Develop State of the Art Multi-story Warehouse



5

New Development Supports Maritime & Logistics Industries
Project supports regional logistics,
maritime & manufacturing industries.
650 to 1200 jobs
Generates income for Maritime
operations & capital projects
Developer commits to prevailing wages
during construction and apprenticeship
utilization; diversity in contracting goals
Redevelopment protects industrial
lands and enhances freight mobility.
Trammel Crow will develop a 2-story 695,000 square foot light
industrial warehouse on Terminal 106


6

Strong Market for Industrial Development
MARKET RENT PER SQUARE FEET







7

Financial Summary
Site area
Total Leasable Development Site Area                   15.07 acres
Total Proposed Building SF                             @700,000 SF
T106 Stabilized Annual Income                         $3,500,000
Cost Basis
Port Remediation Credit                                $2,500,000
Port Feasibility & due diligence costs                        $250,000
Total Cost Basis                                            $2,750,000
NPV                                      $71 million
MIRR                                            12%
Payback period                                        18 months
8

Project Milestones
Commission
Demo & Construction
Authorization to Execute
Rent Commencement
Ground Lease

May                May                               November
M ay
2O21                 20 23                 2023                2 024

Complete Due Diligence,                        Substantial Completion &
DD Waived & Lease                                Full Rent
Commencement                         Commencement

T106 Ground Lease Development Recap
Requesting Commission
authorization to execute the
Ground Lease and associated
easement with Trammell Crow
to redevelop Terminal 106
warehouse.
New facilities will support
logistics and maritime
industries
Excellent market timing for new
development
Substantial completion of
development by Q4 2024.

APPENDIX

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