Seattle, WA Economic Overview
Seattle is located on the northwest coast of the U.S. in Washington state and is currently one of the top 5 fastest growing cities in the country. The city itself is home to over 700,000 residents while the Seattle MSA (Seattle, Tacoma and Bellevue combined) has over 3.7 million people that call the area home. The MSA is the 15th-largest in the U.S. and has a per capita income of just over $61,000. Add to this the over 38 million tourists that visited the area in 2016, and the $9.7 billion in economic impact that they generated, and it's easy to see why the commercial real estate market in Seattle is one of the hottest in the country.
Seattle's most recent gross economic product report came in at just over $231 billion for the year, earning it the 11th ranking metropolitan economy in the U.S. The economy is a highly-diversified mix of traditional businesses, such as manufacturing and transportation, and newer high-tech and biomedical companies involved in service, research, design and clean technologies. The Seattle-Tacoma (Sea-Tac) Airport has commercial air connections to almost all parts of the world, and Boeing Field is used for cargo delivery. The city was recently rated America's #1 Smarter City based on government policies and its 'green' economy, and has been ranked by Expansion Magazine as one of the top 10 metro areas in the nation most friendly to business expansion.
Seattle, WA Commercial Real Estate Market
Seattle is the most important market in the Pacific Northwest with Downtown Seattle being host to the corporate headquarters of both Amazon and Microsoft. There is over 135 million square feet of retail space in the Seattle MSA, with a total vacancy rate of less than 5%, 140 million square feet of office space with a vacancy rate of less than 8%, and nearly 300 million square feet of industrial space with a vacancy rate of less than 3%. Due to the diversified mix of business, the excellent transportation systems and the quality of life, new development and absorption across all categories continues to be strong.
There are over two dozen submarkets in the Seattle MSA that lie along the north-south routes of I-5 and I-405, among them the Southend submarkets of Tacoma Suburban, Kent Valley and Seatec/Burien; the Northend submarkets of Northgate/North Seattle and North Creek/Woodinville; the Eastside submarkets of Redmond, Kirkland and the Bellevue CBD; and the Seattle Proper submarkets of South Seattle, West Seattle, and Capitol Hill.
There are 10 commercial districts in Seattle itself, among them:
Belltown & Capitol Hill together are home to over 12% of the total retail businesses in the city; Pioneer Square is the retail and civic hub of Seattle and home to the Seattle Seahawks and the Quest Event Center;
Seattle Central Business District is home to nearly 50% of the retail businesses in the city and, The SoDo District is a mixed-use area of over 2,000 office, retail and industrial businesses.
The city of Seattle and its submarkets continue to record positive absorption figures of space across all categories of use, demonstrating that the demand for commercial space in Seattle continues to be strong. Other popular neighborhoods are Georgetown, Fremont, and Ballard.
Seattle, WA Office Rental Rates ($/SF/year)
Data provided by Yardi Matrix, for properties larger than 50K SF.
Seattle, WA Office Sales
Data provided by Yardi Matrix, for properties larger than 50K SF, which sold at over $5M.
Seattle, WA Commercial Inventory Breakdown
Office Spaces
Total: 94,159,921 SF
By square footage range:
- 50k to 100k SF: 9,861,245 SF / 10.47% of total office
- 100k to 500k SF: 48,692,793 SF / 51.71% of total office
- 500k to 1M SF: 25,323,993 SF / 26.89% of total office
- > 1M SF: 10,281,890 SF / 10.92% of total office
By class:
- Class A+: 14,071,372 SF / 14.94% of total office
- Class A: 50,753,051 SF / 53.9% of total office
- Class B: 20,433,493 SF / 21.7% of total office
- Class C: 283,859 SF / 0.3% of total office
Industrial
Total: 38,229,766 SF
By square footage range:
- 50k to 100k SF: 7,441,987 SF / 19.47% of total industrial
- 100k to 500k SF: 22,626,753 SF / 59.19% of total industrial
- 500k to 1M SF: 6,307,677 SF / 16.5% of total industrial
- > 1M SF: 1,853,349 SF / 4.85% of total industrial
By class:
- Class A: 3,280,540 SF / 8.58% of total industrial
- Class B: 20,151,656 SF / 52.71% of total industrial
- Class C: 2,353,456 SF / 6.16% of total industrial
Office Spaces with Retail
Total: 14,293,006 SF
By square footage range:
- 50k to 100k SF: 3,566,054 SF / 24.95% of total office with retail
- 100k to 500k SF: 6,634,358 SF / 46.42% of total office with retail
- 500k to 1M SF: 2,392,594 SF / 16.74% of total office with retail
- > 1M SF: 1,700,000 SF / 11.89% of total office with retail
By class:
- Class B: 83,143 SF / 0.58% of total office with retail
Employment in Seattle, WA
Forbes magazine recently ranked Seattle as one of the top 10 Best Places for Business and Careers. Employment in Seattle is driven by a mix of both traditional and high-tech businesses, and is home to five Fortune 500 companies including Amazon, Starbucks and Weyerhaeuser.
The top 10 employers in the Seattle MSA are:
- Boeing, with about 80,000 employees;
- Joint Base Lewis-McChord, a military base that employs around 56,000;
- Microsoft, with about 42,000 employees,
- University of Washington, with 25,000;
- Amazon, with 22,000 employees,
- Providence Health & Services, with around 20,000 employees,
- Walmart, with about 20,000 associates,
- the grocery chain Fred Meyer, with about 15,000 employees,
- Weyerhaeuser, with around 10,000 workers, and 10) the King County government with about 13,000 people.
A quick glance at the above list shows just how diversified the employment sectors of Seattle are. Other major employers with headquarters in the Seattle MSA include Alaska Airlines, Costco, T-Mobile, Nintendo of America, Expedia Inc., Boeing, Seattle's Best Coffee, and the biotech companies Corixa, Trubion, and Vulcan Inc.
Education in Seattle, WA
A recent survey by the U.S. Census Bureau found that Seattle has the highest percentage of college and university graduates of any city in the U.S. and has been listed as the country's most literate city. More than half of the city's residents over the age of 25 have a bachelor's degree and over 90% of the city's residents hold a high school diploma.
Seattle is home to the University of Washington, which was cited by Newsweek International as the 22nd-best university in the entire world.
Seattle also has several private and faith-based colleges and universities including Seattle University, Seattle Pacific University, Antioch University, The Art Institute of Seattle, and Seattle Central Community College which was recently cited by Time Magazine as the Community College of the Year.
The Seattle Public School District serves the city of Seattle with 91 public primary, middle and secondary schools attended by over 50,000 students. The public school system is supplemented by a number of private and faith-based schools including the Bishop Blanchett High School, the Seattle Preparatory School, the Seattle Lutheran High School, and the Seattle Waldorf School.
Commuting Time in Seattle, WA
Seattle falls 10th on the U.S. Census Bureau's list of areas with the longest commutes and has the 8th worst traffic congestion of all U.S. cities. The good news is that the city has started moving away from surface automobile transit and over to mass transit.
- King County Metro provides bus service and operates a fleet of electric street cars within the city.
- Sound Transit provides light rail service, commuter rail service between the city and the suburbs, and express bus service.
- Washington State Ferries operates the largest ferry network in the U.S. and provides service between Seattle and Bainbridge and Vashon Islands, and Bremerton and Southworth.
One might imagine that such a highly-educated workforce uses mass transit, and it does. In fact, almost 19% of Seattle residents regularly use some form of mass transit, giving Seattle the #1 ranking for users of mass transit in the country. Additionally, Seattle has a walk score as the 6th-most walkable city of the top 50 cities in the U.S.
Seattle Demographics
Population
- Total Population708,823
- Male Population(50.4 %) 357,372
- Female Population(49.6 %) 351,451
- Median Age35.50
Income/Financial
- Average Household Income$119,707
- Median Household Income$85,562
- Median Income Under 25$41,179
- Median Income 25-44$99,356
- Median Income 45-64$100,370
- Median Income Over 65$52,392
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