Following some pandemic-related speed bumps, development activity has recently been picking up in Downtown Bellevue, with a greater focus on housing over office development. Elevated interest rates and rising construction costs stemming from the Covid pandemic had put a pause to many of the massive projects planned in the burgeoning downtown. Returning permitting activity is indicating that Bellevue’s redevelopment is kicking back into gear, but not without changes.
Developers have adjusted to the major contributor of development slack, weak demand for new office space and vacancies. As projects reemerge, offices are being replaced with residences. In our April 2024 update on Downtown Bellevue’s projects, The Urbanist had found a significant decline in the planned office space in the downtown; 1.5 million square feet of office space had been canceled.
Last month, the developer of one of the largest projects in the city (and the region) also announced a pivot away from office space. The Pinnacle Bellevue South project disclosed a new residential focus with eight tower containing 2,114 units, 88,267 square feet of retail space, and 2,223 parking stalls. With more than 2,000 homes and eight towers in just one project, it would be the largest residential development in the history of Bellevue.
The proposal is now without the 125,000 square feet of office space contained in the scope that we had first reported on. In addition to the office space, just under 30,000 square feet of retail, the hotel, and just under 300 parking stalls were also cut and exchanged for almost 600 new homes. That scope change adds more homes than the vast majority of projects in the region include in the first place.
An emerging pattern of downtown housing
The Pinnacle Bellevue South also has a sibling to the north — dubbed Pinnacle Bellevue North — which is also seeing these adjustments. Pinnacle’s northern companion will include 1,451 homes across six towers, with 1,814 total parking stalls, according to permits filed in 2023. The project continues to be characterized as mixed-use, but other uses are not discussed in the permits.
We originally reported this project as 60,200 square feet for office space, 1,181 residential units, 129,500 square feet for non-office commercial space, and 1,814 parking spaces over seven towers. The 2023 revision means 270 additional residential units in place of the office and commercial space.
This shift away from office has solidified as a trend in the downtown core. In our last update, we had two big examples. Cloudvue had exchanged 1.3 million square feet of office space for nearly 1,200 homes and the final phase of the Washington Square project had exchanged 129,000 square feet of office space for 400 homes. Meanwhile, some office project had been shelved entirely, with new residential projects emerging elsewhere.
The residential shift is also impacting smaller projects in Bellevue. 11040 Main Street, 305 108th Ave NE, and 200 112th Ave, have collectively shed proposals for over 500,000 square feet of office space in their latest iterations. In their place, more than 700 residential units have been proposed. Along with that lost office space, around 450 parking stalls are also being dropped.
Balancing jobs and housing
All in all, Downtown Bellevue has seen 1,500 additional homes proposed and nearly 700,000 square feet of office space pulled just since April. Altogether with our April update, Downtown Bellevue’s pipeline has seen nearly 4,000 additional homes added and more than two million square feet of office space abandoned in just the last couple of years.
Removing completions since 2022, office space in Bellevue’s pipeline has declined 15%. It’s unclear how many of the remaining office projects are actually alive, but around 11.5 million square feet of office space is still be in the pipeline, based on permits.
Another roughly 2.5 million square feet of office space has been completed, but has been left in a shell state without office space built out or tenants moving in. Much of this is Amazon office space; the retailing giant continues to add jobs in Bellevue, but perhaps not quite as quickly as once envisioned. In 2021, Amazon announced plans to locate 25,000 jobs in the city by 2025. At last count, Amazon has 17,000 workers in Bellevue, compared to about 50,000 in Seattle.
As office development has slowed, residential units in Bellevue’s pipeline have surged 40%. Around 600 or 900 units, depending on how you count Avenue Bellevue’s hesitation to open, have been completed since our 2022 report. The city could be up to 14,000 homes in the downtown pipeline.
This is a big shift from our first 2022 pipeline aggregation of over 13,100 new residential units and over 16 million square feet of commercial space. Assuming 1.5 residents per unit and 250 square feet per job, the 2022 totals would’ve brought around 20,000 residents and 65,000 jobs to Downtown Bellevue, around 3.25 jobs per resident.
The ratio now is more balanced with the development pipeline housing an estimated 21,000 new residents and 46,000 new jobs, which works out to about 2.2 jobs per resident. These ratios impact how workers will arrive at their downtown jobs, more residences downtown mean more workers could live within walking and biking distance to work — and near great transit access via East Link light rail, which opened this April in abridged form.
Breathing Life into Downtown Bellevue
In 2022, around 16,000 people lived in Downtown Bellevue, according to the Puget Sound Regional Council. Another 21,000 people would greatly transform the growing downtown. Office workers will still bring a surge of people into the downtown during peak hours, but close to 40,000 residents can help keep the downtown active throughout the day, encouraging more restaurants, retail, and nightlife to flourish.
These large shifts in the development patterns in Downtown Bellevue reflect the massive scale of projects occurring there. A shift in a handful of projects managed to add 1,500 homes and cut over half a million square feet of office space. Individual shifts can also cut hundreds of parking stalls out of the pipeline. Many of these projects each command the fate of millions of square feet of the downtown’s future.
The Urbanist will be keeping an eye out on how the rest of the over 11 million square feet of office space in pipeline will pan out.
The Urbanist staff occasionally teams up to cover breaking news or tackle large projects. See more about our team on the staff page.