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Sunday, September 29, 2002 - Page updated at 12:00 AM

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Is Lillian building's condition decline or damage?

Seattle Times business reporter

With its boarded-up windows, security guard and imposing chain-link fence, the Lillian building makes a fitting battleground for those who want to preserve the traditionally affordable apartments and Paul Allen's development company, Vulcan, which wants to tear them down.

The city has ordered the vacant 96-year-old building in the largely low-income Cascade neighborhood to be either repaired or demolished after an inspection that deemed its 34 units "unfit for human habitation."

Critics are appealing the order, charging that Vulcan and its real-estate arm, City Investors, intentionally trashed the building at 1258 John St. days before the inspection by punching holes in the walls and ceiling, removing plumbing fixtures and stripping railings from staircases. They claim the company tried to avoid city rules meant to discourage the demolition of low-income housing.

"It looked like the building was hit by some blizzard that tore through and ripped everything out," said John Fox, director of the Seattle Displacement Coalition.

Brian Laird — code-compliance manager for the Department of Design, Construction and Land Use (DCLU) — concluded that Vulcan was responsible for many of the problems that led him to order the building demolished.

"It was clear that City Investors had done some demolition work in the building before the inspection," Laird said. "It certainly wasn't in the condition it was in earlier this year."

Vulcan insists it did nothing wrong. The company says the building's major problems are the result of age and neglect and have little or nothing to do with any work performed before the inspection. What opponents called deliberate destruction was simply asbestos removal and salvage work, spokesman Michael Nank said.

"That fact of the matter is the building was unsafe and hazardous due to decades of neglect by the building's previous owners," he said. "There were no critical elements removed."

Whether the recent damage pushed repair costs above 50 percent of the building's replacement value — the point at which a building has to be repaired or demolished — Laird couldn't say. But even if it did, no law prevents a property owner from intentionally damaging a vacant building.

The city passed a law in 1994 requiring owners to have a master-use permit to redevelop property before demolishing housing. But that rule doesn't apply if the building is in such bad shape that the city orders it torn down, said DCLU spokesman Alan Justad.

"We are definitely on the side of trying to have housing for people, but if someone wants to demolish housing, there are ways of going through the code to have this done," Justad said. "We looked at this closely, and we didn't feel there was a problem legally that some of it was removed actively by the owner."

Diminished impact

Sharon Lee, executive director of the Low Income Housing Institute, says the loss of the Lillian, a half-block west of REI's flagship store, would diminish the impact of new affordable housing in the neighborhood. The nonprofit organization builds and operates low-income apartments, including 89 units in the Cascade area.

"I don't believe (Vulcan) fulfilled the intent of what the City Council or the city wants, which is to preserve affordable housing," Lee said. "This means every landlord can empty their building, trash the building and get a demolition permit."

The city hearing examiner is scheduled to take up the opponents' appeal Nov. 18. Regardless of the result, critics say they will watch Vulcan closely as it moves forward with its redevelopment of South Lake Union.

"Until the Lillian, they have pretty much gotten their way, and now people are starting to get organized," said Fox, who has challenged several commercial developers over housing issues. "It has been Paul Allen's playground, and things are going to change."

'All the good work'

Vulcan says much of the opposition has come from people, such as Fox, who don't live in the area and don't reflect the support the company has received from community leaders.

"The real shame that gets lost in this is all the good work that Vulcan does in the neighborhood," Nank said. "There is a lot of good out there that gets eclipsed by the vocal minority."

Vulcan plans to develop 10 million square feet of office, retail, commercial and housing projects on the 50 acres it owns around South Lake Union. While opposition has grown, it is nowhere close to what The Seattle Commons faced in the 1990s. That Allen-backed proposal to redevelop the area was twice rejected by voters.

Last week, City Councilman Nick Licata started circulating possible legislation that would require Vulcan and other private developers with multiple properties in a single area to unveil development plans earlier and allow for more community reaction.

Vulcan officials complain that the flap over the Lillian unfairly tars the company, which is trying to transform the area into a mixed-used neighborhood that will benefit the city.

Vulcan plans to build at least 50 units of affordable housing in the area — a condition of the company's purchase of 10 city properties — along with 160 upscale apartments or condos. The company won't say what it plans to build on the Lillian property, which it bought two years ago for $1.3 million. But in April, when it offered tenants $5,000 each to move out, few, if any, complained.

Vulcan says that during a preliminary visit to the Lillian in early May, a city inspector said it was OK to start removing asbestos before the formal inspection, to take place several weeks later.

Opponents say that means the city at least tacitly supports Vulcan's bid to demolish the building. Laird says the city inspector did not tell Vulcan to do anything.

"That is not his job," Laird said.

Whether Vulcan intentionally damaged the apartments or removed asbestos and performed salvage work on a building destined for demolition is a moot point for the DCLU.

The city does not make a distinction between damage caused by neglect or by a crowbar, Justad said.

"Whether it was quick or slow, damage is usually the owner's fault," Justad said.

J. Martin McOmber: 206-464-2022 or mmcomber@seattletimes.com

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