Downtown Office Price Collapse: Severe Markdowns in Seattle and St. Louis
The structural shift in office demand, combined with high financing costs and elevated vacancy rates, has triggered severe downward re-pricing of downtown office towers. Two high-profile transactions in May 2026—one in the AI-hub metro of Seattle, and another in the traditional Midwest metro of St. Louis—illustrate the scale of the office value destruction.
Seattle's U.S. Bank Center Dumped at 54% Off
In late May 2026, Blackstone agreed to sell the U.S. Bank Center, a prominent 30-story, high-900,000s square foot office tower in downtown Seattle, to Spear Street Capital for approximately $280 million.
This sale price represents a staggering 54% markdown from the $612 million Blackstone paid for the property in 2019. This transaction underscores the massive erosion of office asset values in a premier tech-hub metro, even as the local residential market remains highly competitive.
The transaction took place against a backdrop of severe office vacancy. Colliers' Q1 2026 Puget Sound Office Report highlighted that Seattle's central business district (CBD) vacancy has reached the mid-30s percent range (specifically hitting 36.5% in downtown Seattle), with regional availability exceeding 25%. This supply-demand mismatch has forced landlords to offer deep concessions and capitulate on sale prices.
St. Louis' Bank of America Plaza Scheduled for Foreclosure Auction at a 95% Discount
In an even more extreme example of traditional metro office decline, lenders scheduled a foreclosure auction for the Bank of America Plaza in downtown St. Louis for June 2026.
The 30-story, 749,857 square foot Class A office tower at 800 Market Street is slated to go under the gavel with bidding expected to start at just $2.0 million. This starting bid represents a shocking 95.8% drop from the building's reported $48 million purchase price in 2010.
The property has suffered from severe vacancy, with approximately 392,986 square feet (52.4% of the tower's rentable area) currently advertised as vacant and available. CBRE's Q1 2026 Midwest figures show rising vacancy and negative net absorption across regional markets, adding intense pressure on owners of older, large-scale downtown office towers.
Cross-Market Synthesis
These case studies reveal that the office collapse is a nationwide structural phenomenon affecting both premier tech gateway cities like Seattle and secondary/industrial metros like St. Louis. While AI wealth is supercharging residential real estate (as seen in AI Wealth Supercharges San Francisco and Silicon Valley Housing Markets), it has not saved downtown office districts, which remain hollowed out with 30%+ vacancy rates and massive capital losses for institutional landlords.