State Documents: Former Amazon Building Lease Could Cost $270M Over 30 Years
By Austin Jenkins
More than a quarter-of-a-billion dollars over 30 years. That’s how much it could cost the state of Washington to lease and operate the former headquarters of Amazon.com. Earlier this year, state lawmakers voted to turn the building into a new training center for future health care workers. The preliminary cost estimate is contained in documents released as part of a public records request by Olympia Correspondent Austin Jenkins.
Pacific Tower is the 14-story brownish-red former hospital that you can’t miss if you’re stuck on I-5 south of downtown Seattle. It’s now empty. The state of Washington has signed a letter of intent to lease it for a community college health care training program to fulfill demand created by Obamacare.
Internal documents peg the total cost of that lease - including utilities and maintenance - at more than $270M over thirty years. It’s not a good value for taxpayers, says Senate Majority Leader Rodney Tom – a Democrat aligned with Republicans.
Rodney Tom: “You had a very sophisticated operator Wright Runstad that couldn’t make that building work and to think that the state can come in there and make it work, it just makes no sense.”
Wright Runstad lost its lease on the building after it couldn’t find a replacement for Amazon.com and missed a lease payment. Democratic Speaker of the House Frank Chopp has been a key champion of the plan for the state to take over Pacific Tower. He was traveling and unavailable, but fellow House Democrat Jamie Pedersen says he thinks the lease pencils out – especially since the rent money would go to a development authority whose primary mission is to fund low-income health care.
Jamie Pedersen: “Where it really becomes a win, win, win is that you’re getting a pretty good deal on a great building, you’re using the building to a great effect and all of the rent from the lease is going to help people get health care.”
Washington state is currently in the midst of a 90-day due diligence review of the proposed 30-year lease. State officials caution the quarter-of-a-billion dollar cost projection is “very preliminary.” Also, the state would hope to offset at least half that cost by sub-letting space in Pacific Tower to other tenants.