Submitted by Don Doman
An almost killing blow was dealt to Seattle icon Ivar’s Fish Bar in early June, when it was announced that their lease would not be renewed by the Seattle-Tacoma International Airport.
If you don’t know the name Ivar, then you don’t know much about Seattle, the Pacific Northwest, and seafood. Here’s the basics from the Ivar’s website: Ivar Haglund was a true Seattle character and icon. He was known as an entertainer, folksinger, restaurateur and ultimately the “King,” “Mayor,” or “Patriarch” of the waterfront. The story of Ivar’s Seafood Restaurants began in 1938 when 33-year old Seattle native Ivar Haglund opened his city’s first aquarium on Seattle’s Pier 54. Droves of people lined up and paid a nickel to view the sea life that Ivar had collected from the surrounding Puget Sound. Noticing that his patrons often came with an appetite, Haglund began to sell red clam chowder and fish n’ chips from the site—an instant success that began his career as a restaurateur.
The Seattle Times headline from January 26, 2017 shows the importance of the international airport, “Sea-Tac airport’s booming passenger volume makes it 9th busiest in U.S.” The article goes on to say “Record passenger travel through Seattle-Tacoma International Airport in 2016 vaulted the airport ahead of Houston, Phoenix, Miami and Charlotte to rank as the ninth busiest in the U.S., the Port of Seattle said Thursday.” Sea-Tac served 45.7 million passengers during 2016 and many of them ate at Ivar’s. Ivar’s Fish Bar at Sea-Tac grossed $4.9 million in food sales for 2016. Less than a month after the no lease announcement it was announced that the restaurant would not be leaving.
Okay, so we all know that location is important in real estate appraisals and especially in commercial real estate appraisals, but great location means more than a dot on the Zillow map, it’s a point in time as well. As hockey great Wayne Gretski advised, “Skate to where the puck is going, not to where it’s been.” In other words, you don’t want to buy and sell right now. You want to buy and wait and then sell or develop when the time is right. To buy when everyone else is buying is costly. The ideal time to buy is when you have evaluated your goals, what you think changes in the future will amount to, and how long will it take to recoup your investments. Ivar’s built up a reputation and a customer base and after eight years still fights to maintain it.
If you’re looking to develop a shopping mall, an apartment complex, or open your own fish bar, you need to think about locations, financing, planning, the influx of new residents, possibly overloaded infrastructure, and probably thousands of other minor details . . . then figure out what this means five or ten years down the line. You should always be looking at value. Many of those same elements come into play whether you are selling or buying any commercial real estate. Luckily, you’re not alone. One of your new best friends should be a Commercial Real Estate Appraiser from the state where you want to deal in real estate property.