Kirkland-based Sage Investment Group has acquired the Studio 6 motel in Mountlake Terrace, intending to convert it into affordable multifamily housing.

A spokesperson for Sage Investment Group stated that the currently unnamed complex is expected to open in early 2027. Sage plans to  completely renovate the units and amenity spaces.

“Each unit will be transformed into a studio apartment, including a new kitchen,” the spokesperson said.

Sage specializes in adaptive reuse, the repurposing of a structure for a different use. In this case, that will be converting a hotel into multifamily middle housing. This will be the ninth conversion property in Washington state and the 29th property Sage has converted nationwide.

The housing is designed for individuals with moderate incomes who may not qualify for subsidized housing.

While final pricing will be announced closer to opening, Sage said that rents “will be competitively positioned for the area and reflect the quality and amenities offered.”

A Mountlake Terrace spokesperson said that the city is pleased with the opportunity to provide more housing options, which aligns with the Vision 2044 Comprehensive Plan.

“The city is excited to welcome a new development that will provide lower-cost housing in close proximity to our light rail station. It’s a wonderful addition to our growing community.” City Manager Jeff Niten said.

Some of the advantages of renovating existing motels include the existing infrastructure, for example, Studio 6 already has everyday amenities, such as mailboxes and a laundry room.

“Amenities such as parking and physical infrastructure are already in place, and core services like cable, internet and utilities are set up,” the Sage spokesperson said. “This saves us time and allows us to bundle service costs for tenants.”

Sage will have concept renderings available within the next two to three weeks.

Located on Van Ry Boulevard, Studio 6 is situated in a prime location for commuters and transit-oriented residents, being almost equidistant from the I-5 on-ramp and the Mountlake Terrace light rail station. Across the street is the Regal Cinebarre and a Grocery Outlet store that is scheduled to open in August 2025.

However, this acquisition means the loss of Mountlake Terrace’s only hospitality business, which – through the city’s lodging tax – has helped fund city events such as the Arts of the Terrace Juried Art Show and the Tour de Terrace.