Stockbridge Capital Group, Capstone Partners Welcome Facebook to Dexter Station

Social media leader signs lease to occupy most of South Lake Union project

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Feb 26, 2015, 09:00 ET

SEATTLE, Feb. 26, 2015 /PRNewswire/ -- Stockbridge Capital Group and Capstone Partners, developers of Dexter Station in Seattle's South Lake Union neighborhood, officially welcomed Facebook Inc. to the newly constructed 10-story building. Facebook last week confirmed that it will lease 274,000 square feet at Dexter Station with an option for the remaining two floors.

The deal marks the largest office lease ever executed in Seattle by a company headquartered outside the region. Capstone Partners, based in Seattle, developed Dexter Station with equity and financing from San Francisco's Stockbridge Capital Group.

The deal affirms the development group's unwavering confidence in the South Lake Union market: Dexter Station was fully constructed prior to the signing of any leases.

"We're so delighted to have a company of this caliber in the building,'' said Terry Fancher, Executive Managing Director of Stockbridge. "Capstone has done an excellent job of executing the vision for this project.''

Said Mike Hubbard of Capstone Partners: "We had great confidence in this location and this particular design. Technology companies do not have two to three years to wait for a project to come on line – they need space they can occupy in 12 months or less.''

Dexter Station is an unconventional design ideally suited for a technology company, with larger floors and more building infrastructure per floor to support a higher-density workforce. LMN Architects designed the building, which includes multiple large roof decks, LEED Gold certification, higher ceilings and much larger windows than typical buildings to highlight the stunning views. Dexter Station includes a state-of-the-art conference center and workout facility, retail services, and nearly as many bike racks as parking stalls.

"The result was ideal," said Stephen Pilch of San Francisco based Stockbridge Capital. "We have seen the progression of technology firm's use of space in the Bay Area over the last several years; we were confident that our plan would work."

Construction of Dexter Station was completed earlier this month by JTM Construction, with support from Prime Electric and Holaday-Parks. Stuart Williams, Joe Gowan and JJ Sheppard are the JLL leasing team.

Both Capstone and Stockbridge Capital are active elsewhere in Seattle.

Stockbridge, with development partner Daniels Real Estate, has begun construction on a $400 million 43-story office building in downtown Seattle that will include the SLS Seattle luxury hotel. The project includes the historic renovation of the adjacent First United Methodist Church sanctuary.

Stockbridge also recently purchased Rollin Street Flats, a 208-unit multifamily complex in South Lake Union.

Dexter Station is one of many active projects for Capstone in the region. Next door to Dexter Station, Capstone and partner Holland Properties, developed The Union, a 284-unit apartment building that was completed in 2013 and is 98 percent occupied.

Capstone also purchased the 28-acre former Group Health site next door to Microsoft's world headquarters, where it will create Esterra Park, a development of nearly 3 million square feet of commercial and residential buildings. Early this year at Esterra Park, Avalon Bay commenced construction on the first 500 units; a new 275-room Starwood Hotel will break ground in June. Capstone is preparing to break ground on more than 600,000 square feet of office on the site.

Capstone also is very active in Portland, with multiple mixed-use projects and a large speculative warehouse project near the airport.

For more information, please visit www.dexterstation.com.

About Stockbridge Capital Group, LLC:
Stockbridge Capital Group, LLC is a real estate investment management firm which, together with its affiliates, has approximately $8.8 billion in real estate and real estate-related assets under management as of September 30, 2014. Stockbridge's investment portfolio comprises more than 30 million square feet of existing office, industrial, retail, hospitality and residential properties throughout the United States. In addition to real estate ownership, Stockbridge also specializes in large-scale development and redevelopment projects. Stockbridge is headquartered in San Francisco with offices in Chicago, New York, Atlanta and Los Angeles. For more information, please visit www.stockbridgerealestate.com.