Safeco Agrees to $210 Million Sale & Short Term Leaseback of Office Campus Near Seattle

Puget Sound Business Journal - Jamuary 18, 2006

Microsoft is planning to buy Safeco's old space in Redmond. In a Jan. 13 SEC filing, Safeco Corp. (NASDAQ: SAFC) said it had reached a tentative agreement to sell its 40-acre Redmond campus to Microsoft Corp. (NASDAQ: MSFT) for $209.5 million. Safeco expects to realize a pre-tax gain on the sale of approximately $29 million.

Under the terms of the agreement, Seattle-based Safeco's wholly owned subsidiary General America Corp. can end the deal at any time before April 13 should Safeco determine it won't proceed with a proposed, 260,000-square-foot expansion of its headquarters in Seattle's University District. Additionally, either party has the right to terminate the agreement if Safeco is unable to get construction permits for the proposed office project by Jan. 13, 2007.

The planned sale does not include Safeco's data center on the Redmond campus, which is located on 154th Place Northeast in Redmond.
After the sale closes, General America Corp. will lease a portion of the campus for up to three years to allow Safeco time to complete its headquarters expansion and relocate its approximately 1,350 Redmond employees to Seattle. The lease includes 549,180 square feet of office space and 70,649 square feet of warehouse space.

General America has agreed to lease a 218,496-square-foot office building on Safeco's Redmond campus to Microsoft beginning next month. The lease, which will terminate on completion of the sale, can be extended if the sale does not close. Microsoft has until mid-February to complete its due diligence inspection of the Safeco property, during which time it can decide on its own whether to proceed with the purchase. Sphere: Related Content