South Lake Union Changing, Commons Or No Commons -- With 10 Projects In Works, `It's The Hottest Development Area In The City Right Now'
Seattle Times Staff Reporter
With or without the Seattle Commons, South Lake Union is evolving into a more white-collar, upscale neighborhood.
Ten construction projects are under way or awaiting final approval - and none hinges on whether voters approve the Commons on Tuesday.
They range from a new Marriott hotel and a five-story software-company-office building just off the park's northwestern boundary, to REI's flagship store, a few blocks east of what would be the park's southern end.
The Seattle Times Co., which owns more property in the area than anyone other than billionaire Paul Allen and the nonprofit Commons organization, also tentatively plans a new printing plant/newspaper distribution center and two 10-story office buildings.
"It's the hottest development area in the city right now," said Eric Dupar, a local real-estate agent with clients and property in the area. "It's been sitting there, waiting and waiting for its turn. And now its time has come."
The key question for voters: Will they pony up the money for a sizable park and the vision for a new neighborhood around it?
Regardless of the answer, real-estate interests will profit handsomely. But city rezoning and rising property values driven by the proposed 42-acre park are sure to make projects there even more lucrative, real-estate experts say.
Park supporters and city officials say the $167 million project would provide Seattle with an aesthetic link between downtown high-rises and the shores of Lake Union, while also ensuring that residents get a foothold in a fast-changing neighborhood.
Without the park, many fear South Lake Union will lack a sense of community and become a blanket of concrete and steel.
"Do we want development to be haphazard, or work together a bit?" asks Mark Weed, president of Fisher Properties Inc., a major proponent and contributor to the Commons.
Opponents say the city has other tools to nurture well-planned growth and should preserve the neighborhood already there.
"It's obviously the next area that's going to get a lot of attention," said architect Patricia Fels, who is part of a group trying to create a historical district in the neighborhood. "It's just a matter of whether it's going to be locally controlled, or have some outer force come in."
Hodgepodge of firms
The area now is a collection of warehouses, light-manufacturing plants, and wholesale and retail stores that sell everything from hair tint and flowers to sports trophies and electrical tape. Bounded by Interstate 5 to the east and Aurora Avenue to the west, it started out in the late 19th century as Seattle's industrial work yard.
Lately, the work has entailed more keyboards than chemicals.
The recent arrival of Fred Hutchinson Cancer Research Center and ZymoGenetics caused academic and high-tech types to give South Lake Union a second look.
Walker Richer & Quinn (WRQ), one of the state's largest software companies, was among the newcomers that decided to put down roots. One of the biggest boosters of the Commons campaign, contributing $15,000, the company awaits completion of a five-story office building near the southwest corner of Lake Union, hopeful the park will follow.
In some ways, the public park would supplant the private soccer fields and lawns that are traditionally bought and paid for by software companies on the Eastside.
The University of Washington wants to move its genome research project to South Lake Union, and others have talked about making room for Seattle's budding digital film industry there.
"Of course, it's not ideal that businesses have to move, but I think it (the Commons) will bring more businesses and improve things for the ones already here," said WRQ marketing writer Will Hewlett.
Not that real-estate agents have had any trouble selling the area lately.
The owners of Silver Cloud Inns paid nearly $76 a square foot earlier this year for an abandoned warehouse and the land under it, to build a new hotel just north of the Fred Hutchinson Cancer Research Center. That's nearly twice what the Hutchinson Center paid for its land five years ago.
That South Lake Union is centrally located and close to I-5 has made it increasingly attractive as an extension of the city's downtown core, not to mention the fact that Seattle is enjoying a healthy bounce in the economy and in national popularity.
Indeed, few real-estate brokers see the area remaining "a no-man's-land" without the Commons. But they also predict development would come more slowly.
Rezoning is key
It's rezoning that will more directly affect development prospects, property owners and real-estate agents say - and that's likely to occur to some degree regardless of the Commons.
Zoning restrictions on height would likely be loosened to allow for higher office buildings, and certain parking requirements would be waived. To encourage a pedestrian-friendly neighborhood, planners are seeking the strictest design requirements anywhere in the city. But those rules probably wouldn't be approved without the park.
Residential projects are likely to be affected the most by the election, said Frank Bosl of CB Commercial, a real-estate brokerage firm. He knows of several parcels where developers planning to create loft-style housing are holding off purchases until the Commons is approved.
"I don't know of many people who would be doing residential development without it," Bosl said.
Though the city plans to have 600 housing units set aside as low-income housing, opponents don't believe new apartments and condominiums will be affordable to working families. In a 560-acre area that, for years, was too flat to afford much of a view, properties surrounding the new Commons would likely become some of the most desirable in the city.
Rich Reel, a South Lake Union property owner, is well aware of that as he campaigns for the ballot measure. He helped form the Westlake Business Coalition, a group of 50 property and business owners that has been donating time and services on behalf of the $50 million property-tax levy.
One of his properties fronts the west boundary of the proposed park and would probably be developed into apartments or condominiums within the next five years if the Commons is approved.
"Certainly I have a self-interest. I can't deny it," Reel said of his role in the Commons. "But I care very much about the neighborhood."
What role for The Times?
Some say The Seattle Times Co., as the largest property owner in the area, stands to gain the most in rising property values and will become a key player in determining the neighborhood's character. Part of its $150 million-plus proposed expansion project includes plans for retail operations and two high-rise office buildings, one of which would probably be leased to a high-tech or bio-tech firm.
"The Commons doesn't affect our plans at all," said H. Mason Sizemore, president and chief operating officer of The Times. The decision to expand in downtown Seattle or move to a 35-acre location in Renton hasn't been made, he said, and will depend on economic conditions rather than on construction of a park.
Sizemore acknowledged that the Commons would afford the newspaper more development opportunities but noted that rising property values also will drive up the cost of doing business. The newspaper supports the Commons on its editorial pages, but as a property owner has stayed out of the campaign.
Other property owners and individuals with finance and real-estate interests, meanwhile, are promoting the project, saying they want to help add to the city's amenities.
Key Bank of Washington, for example, has donated volunteer time and $10,000 in contributions to the Commons campaign. Keith Jackson, Key Bank vice president of corporate banking, is one of five bankers who sit on the 47-member Seattle Commons board of directors.
Making money from growth in South Lake Union is not why Key Bank is involved, Jackson said. But he added, "I would guess that as development occurs and as development needs capital, we probably would have a chance along with other banks to bid for business."
Together, contractors, bankers, investors, hotels and developers have donated $134,498 to the Commons campaign this year - 43.7 percent of the total raised. Ten of 47 members of the nonprofit organization's board of directors are affiliated with finance, tourism, contracting and real-estate interests.
Commons supporters say many were invited to join because of their expertise, but that the bulk of park support has come from citizens and civic leaders, such as former Gov. Dan Evans and former City Councilwoman Phyllis Lamphere.
"They're excited about what this does for the city," said campaign spokesman Bob Ratliffe.
Stuart Rolfe, a Commons board member, envisions a new market for an extension of the Monorail. His company, Monorail Services Inc., runs the 1-mile route that was built for the 1962 World's Fair. A proposed 3-mile extension linking Seattle Center, Lake Union, downtown and the convention center probably won't get off the ground without the park, he said.
But Weed, president of Fisher Properties, says his company will continue working with the city to convert old railroad tracks into a walking and bicycling trail along the west side of the lake, regardless.
Melvin Brady figures he's in the right spot no matter.
As president of BBS International Inc. and exclusive agent for a Japanese-based company that owns two parcels on Fairview Avenue North, he and his partners are weighing the potential for a bio-tech office building, or a mid-rise residential project.
"The site and opportunity won't go away if the Commons doesn't go through . . . ," Brady said. "This is an area in transition, and in many ways, that's where you want to be." ----------------------------------------------------------------- Properties with ongoing and potential development:
1. Walker Richer & Quinn.
Software company, five-story building, $20 million.
Completion this fall.
Second five-story office building;.
Groundbreaking May 1997.
Property owners: Firdex Associates, Seattle.
2. Marriott Courtyard .
923 Westlake Avenue North.
252-room hotel, land sale and development tentative.
Property owners: Dupar Investments Inc. (property owner).
3. Silver Cloud Inn, 526-5200; 883-3191.
1150 Fairview Avenue North.
184-room hotel, $14-$15 million.
Scheduled completion next year.
Property owner: Lake Union Silver Cloud Inn L.L.C.
4. Fred Hutchinson Cancer Research Center .
100 FAirview Ave. N..
Phase 2, clinical research laboratory, five-story building;
Opening in 1998
Property owner: Fred Hutchinson Cancer Research Center.
5. Four-story office building.
1260 Mercer St.
90,000 sq. feet, aimed for bio-tech or high-tech company.
Construction scheduled next year.
Property owners: Bruce Blume & Co. and Ratelco Properties Corp.
6. Biotech/office/retail or residential/retail project,
530 Fairview Ave. N.
Plans pending, based on rezoning.
Property owners: Yuasa Funashoku America Inc. and BBS International Inc.
7. Recreational Equipment Inc..
222 Yale Ave. N. 80,000 sq. foot flagship retail store, with cafe and 460 adjacent parking spaces.
Scheduled opening in September.
Property owner: REI (property owner)
8. High-rise office building or retail complex
1250 Denny Way (currently, Greyhound maintenance facility)
Land sale and development plans pending
Property owner: Greyhound Co.
9. The Seattle Times
1120 John St. (four blocks at Denny and Fairview Avenue North)
Two 10-story office buildings, printing plant,
newspaper distribution center and multi-level parking garage;
more tha $150 million.
Property owner: The Seattle Times Co.
10. Holiday Inn Express
226 Aurora Avenue North (currently, City Center Hotel)
205-room hotel and suites
Groundbreaking this summer
Property owner: Emerald Hospitality Inc.
SOURCE: Reporting by Barbara A. Serrano. ----------------------------------------------------------------- SEATTLE TIMES
Copyright (c) 1996 Seattle Times Company, All Rights Reserved.