Cresset Diversified Real Estate Capital, a sponsor of qualified opportunity zone funds, has partnered with real estate development firms Hatteras Sky and Trent Development to develop two mixed-use opportunity zone projects in Seattle, Washington.
NorthMarq’s Seattle team arranged $70 million in joint venture equity between the developers and Cresset Diversified.
The 622 Rainier Avenue project is located approximately one-half mile from the future Judkins Park light rail station in the Jackson Park neighborhood of Seattle. The project will include 205 residential units and approximately 5,200 square feet of ground level retail. The project will utilize Seattle’s multifamily tax exemption program, which requires 20 percent of the units to be dedicated as “affordable.” Construction is slated to begin in March of this year.
Lynnwood is situated within the “City Center District,” an area of new development that have light rail access beginning in 2024. The project will include 359 multifamily units and approximately 10,000 square feet of ground-level retail. The project will also be enrolled in Lynnwood’s multiple unit housing property tax exemption program, which will allow for 20 percent of the units to be dedicated as workforce housing. Construction is expected to begin in the summer of 2021.
622 Rainier is designed by Studio 19 Architects, and Lynnwood is designed by Clark Barnes Architecture. Blanton Turner will be the property manager.
Cresset Partners and Diversified Real Estate Capital’s first opportunity zone fund closed in March 2020 after raising the $465 million in capital needed for the portfolio and the seven underlying projects. The companies launched a follow-on fund, the Cresset-Diversified Qualified Opportunity Zone Fund II with an investment mandate equivalent to the first fund. Fund II recently closed on its first deal—two multifamily buildings in the Seattle metropolitan area—and has two additional deals under way.