Smith Tower - History

History

In 1909, Smith planned to build a 14-story building in Seattle. His son, Burns Lyman Smith, convinced him to build instead a much taller skyscraper to steal the crown from rival city Tacoma's National Realty Building as the tallest west of the Mississippi. Construction began in 1910. Although Smith did not live to see it, the building was completed in 1914 to a height of 143 m (469 ft) from curbside to the top of the pyramid, with a pinnacle height of 149 m (489 ft). Its ribbon cutting was July 3, 1914. Ivar Haglund of Ivar's restaurant fame bought the tower for $1.8 million in 1976. The Samis Foundation acquired the tower in 1996. In 2006, the building was purchased by Walton Street Capital. The building has been renovated twice, in 1986 and in 1999.

In recent years high-tech companies have been occupants of Smith Tower, which sports fiber-optic wiring. The burst of the dot-com bubble hurt Smith Tower by raising its vacancy rate to 26.1 percent, twice Seattle's commercial vacancy rate, as of December 21, 2001. The Walt Disney Internet Group, for example, at the time reduced its seven floors to four. By 2007, the occupancy rate had rebounded to about 90 percent, with new occupants such as Microsoft Live Labs.

Following the announced departure of the building's two largest occupants that included Disney, which moved to the Fourth and Madison Building, Walton Street Capital filed an application to convert the building into condominiums. This has not come to fruition because of weak demand for condos.

In 2011 CBRE Group reported that they had purchased a 2006 42.5 million dollar mortgage in default on the Smith Tower. The loan was taken out by current owner Walton Street. When CBRE stepped in, the building was 70 percent vacant, its rent income was not covering its operating expenses, and its value was assessed by the county to be less than half of its 2006 mortgage. Smith Tower was sold to CBRE at a public foreclosure auction on March 23, 2012.

In the spring of 2012 Smith Tower experienced a brief revitalization in the form of new companies moving into some of its empty floors including Portent, Inc., an internet marketing company, marketing consultant Aukema & Associates, graphic-design firm Push Design, and Rialto Communications, a marketing and public-relations company.