Bellevue church ready to sell in hot market
Bellevue First Congregational Church hopes to sell its prime downtown property — its home for more than 100 years — and use the money to build a new complex on less-expensive land.
Seattle Times business reporter
When strawberry fields still dotted downtown Bellevue in the 1950s, Bellevue First Congregational Church’s new sanctuary was one of the biggest buildings in town.
Now that sanctuary is surrounded by 25-story office towers. Downtown Bellevue is on the cusp of another development boom.
And First Congregational is putting up for sale the property that has been its home for more than a century.
It is some of the most valuable real estate on the Eastside. Bellevue Square and Lincoln Square are two long blocks to the west, the high-rise Bravern complex with its Microsoft offices and Neiman Marcus store a block to the east.
A consultant to the church estimated in 2011 that the 1.6-acre site was worth $20 million to $25 million — and the market is stronger now.
“There’s value here,” says Jim Young, who heads the church’s real-estate committee. “Rather than sit on it, we’ve decided we want to do something with it.”
The growing congregation arrived at that decision after a careful examination of its needs and priorities.
It decided that it wanted to remain downtown, but that its aging building complex no longer worked.
The congregation also concluded that selling the property could generate enough cash to purchase less-expensive land in a less-central downtown location and build something better-suited to the church’s 21st-century mission.
So First Congregational is looking to buy as well as sell. The transactions are linked, Young says — the church won’t let go of its old home until it has found a new one.
Brokers from Kidder Mathews are working with the congregation on both deals.
Zoning allows towers up to 450 feet tall on the church’s property, on the prominent corner of 108th Avenue Northeast and Northeast Eighth Street.
First Congregational’s decision to sell it comes as developers are showing renewed interest in downtown Bellevue. Projects with more than 1,100 apartments and condos and 1.5 million square feet of office space could break ground this year.
“The stars have aligned,” says Jason Rosauer, a Kidder Mathews partner who, with colleague Stan Snow, is listing the church property. “It’s the right time for the church, and the right time in the development cycle.”
First Congregational isn’t the first center-city church to consider leveraging its real estate to endow its future.
In Seattle, First United Methodist used proceeds from the 2008 sale of its historic downtown home to build a new complex near Seattle Center.
Gethsemane Lutheran, another downtown Seattle church, sold its parking lot in 2007 — a 37-story apartment tower now rises there — then used most of the money to renovate its campus, adding a center for the homeless and 50 units of affordable housing.
Bellevue First Congregational has considered redeveloping or selling its property on-and-off since 1970. The decision to finally take the leap arose from long-range planning that began in 2006.
Most members initially wanted to stay put, according to a 2012 church report on the process: The congregation’s roots on the site run deep.
Its first sanctuary there, “The Little White Church,” was dedicated in 1901, when there wasn’t much else to Bellevue.
“They had to clear 8-foot- and 9-foot-diameter stumps to build it,” Young says.
He joined in 1968, when teenagers Ann and Nancy Wilson, who grew up in the church and who later would form Rock and Roll Hall of Fame band Heart, sometimes sang at Sunday services.
The congregation’s attachment to its longtime location ultimately gave way to a recognition that renovating the 50- to 60-year-old buildings, or rebuilding on-site, made less sense financially than selling and relocating.
“The buildings are old,” Young says. “Who wants to put big money into old buildings?”
The boiler is an antique. The kitchen “barely functions.” The fellowship hall where parishioners gather for coffee after worship is in the basement, “and people don’t go down stairs . . . it’s easier to walk out the door.”
The meeting rooms are too small, and there aren’t enough of them. The church wants to do more for the homeless, but it lacks the space.
And there’s not enough parking. First Congregational has a perpetual easement to use property to the east on Sunday mornings, when about 250 attend the two services.
But those stalls aren’t available during the week. And that limits the church’s ability to host midweek events that could attract newcomers perhaps less inclined to participate in traditional Sunday worship.
Renovating the campus to address all its shortcomings would have cost $13 million the congregation didn’t have, according to an analysis prepared for the church in 2011 by Seneca Group, a Seattle real-estate consulting firm.
Given the underlying value of the land, selling and relocating is better stewardship, Young maintains.
Lead Pastor Kevin Brown remembers one 90-year-old parishioner approaching him after a meeting at which the alternatives were laid out:
“None of us wants to move,” Brown recalls the longtime member saying, “but the numbers just don’t work.”
While an apartment, condo or hotel project could be built on the church’s property, an office tower seems most likely, broker Rosauer says.
The office-vacancy rate in downtown Bellevue is among the region’s lowest. Boston-based Beacon Capital Partners has signaled it could break ground this year on a 23-story office project just east of First Congregational.
And Rockefeller Group of New York this month announced a tentative deal to build up to three office towers just a block to the west.
The First Congregational listing doesn’t include an asking price. The property must be offered first to Beacon under terms of a previous real-estate deal.
Selling probably won’t be as challenging as finding property for a new home, Young says— and each deal hinges on the other.
The church is focusing its search on properties along downtown’s periphery, on streets such as 112th Avenue Northeast and Main Street, where property values are lower, in part, because zoning is more restrictive.
It’s important to First Congregational to remain a downtown church, Young says: That’s where the homeless and others in need tend to congregate, where transit service is best.
“We’re not looking to build a bigger church,” he says, “but a better one.”
Eric Pryne: firstname.lastname@example.org or 206-464-2231