Council Approves Town Square ‘Standstill Agreement’; Could Mean New Apartments
Burien City Council members approved on a 7-0 vote Monday a “standstill agreement” (download PDF file here) that gives Harbor Urban until Nov. 15 to submit an acceptable plan for a second Town Square housing development.
The agreement, already negotiated with and agreed to by Harbor Urban, removes the option of legal action should Burien reject a new development plan and exercise its right to buy back the three vacant Town Square parcels.
“This agreement makes it possible that we can avoid litigation altogether,” City Manager Mike Martin told the council.
“This lets the city have the ability to accept or reject” any proposed development and sets a deadline – allowing the city to “control the property and control the product. I think it’s a constructive path forward.”
Indications are that instead of more condominiums, as originally planned, Harbor Urban will build higher-end apartments as their Phase Two development.
Prior to the council’s unanimous June 4 vote to begin a buy-back process, Harbor Urban representatives, citing the recession’s impact on housing sales, asked lawmakers for more time to submit a development plan that the market would support.
Original Development Agreement
“The developer will defend the investment it has made in the Town Square project and its record of good faith bargaining despite the commercial frustrations it has faced,” they were told – indicating likelihood of legal action if the city proceeded directly with a buy back.
The city’s original development agreement with Urban Partners, which was signed in 2005, called for development of condo/retail complexes on each of the three major private properties in Town Square.
By the time the first seven-story building was completed in 2009, however, the housing market was crashing and the rest of the economy was in a recession.
This bad timing not only interrupted condo sales at the existing complex, it also impacted Urban Partners – now Harbor Urban – which had two years under the development agreement to begin construction of a second private Town Square project.
Harbor Urban had been in default of this requirement for 11 months when the council voted to begin the process of buying back the three vacant parcels at 90 percent of what they sold for in 2005, as also provided in the development agreement.
A “Reluctant Vote”
At Monday’s meeting, Councilwoman Lucy Krakowiak said she would be a “reluctant vote” for the standstill agreement. “I have been an advocate for condos [in the second and third developments] and believe the market can still hold condos if done well.”
Councilman Bob Edgar said that he, too, is concerned about building apartments instead of condos in Town Square.
But, Martin noted, “there is general agreement in the marketplace that condos aren’t possible right now. If you want condos you will have to be prepared to wait quite some time for development of them.”
Krakowiak disagreed. Saying she had read an article in the Seattle Times a few weeks ago that indicated the market for condos is improving, she added, “I believe condos are possible.”
This prompted Mayor Brian Bennett to observe that Martin was citing the opinion of developers. Krakowiak responded that she disagreed with their viewpoint.
“We need to reorient out idea of what apartments are about,” Martin interjected. “We still think of apartments as what was built in the 60s and 70s” along Ambaum Boulevard and other pockets in the city.
“Whatever is built has to be of comparable quality to the condominium complex. With input from you it will be impossible for them to build anything of lower quality.”
“Times Have Changed”
Councilwoman Joan McGilton said that early in Burien’s history as a city, the council was looking at apartments being built in Seattle, including “converting apartments into low-quality, high-priced condos.”
Now, she continued, “We’re looking at folks who can’t afford to buy a house.” Largely young professionals, these people “are our prospective future.”
Quality apartments downtown “would get them rooted in our community,” McGilton said. “Hopefully they will stay here when they can buy a home.
“Times have changed. We really need to be forward thinking and not locked into condos as the only thing that will work in Burien.”
“You can believe the experts and statistics or not,” Councilman Gerald Robison declared. “If something gets done here, it has to be based on what can be done.
“If we have good quality apartments, upper range, with good management, you can’t tell the difference between condos and apartments.”
Timing Affects Downtown Businesses
Bennett reminded his fellow council members to “also keep in mind the timing, how this will affect the surrounding downtown businesses. A lot has gone into these negotiations,” and he called the agreement “extensive and detailed.”
The standstill agreement holds in abeyance the city’s option to repurchase these properties. The clock for Burien to take action started running when council members took their June 4 action.
Martin said earlier that in addition to higher-end apartments being built instead of condos in the second private Town Square development, “Most likely it would not have retail” on the ground floor like the existing complex does.
That retail space has remained vacant except for a Subway Shop now getting ready to open there.
The city will impose three requirements on this development, he told The B-Town Blog at that time: density of housing units; “structured and largely hidden parking, not a surface parking area;” and “quality that is compatible with what we already have.”
Below are some relevant portions of the agreement – click images to see larger versions (or download the full PDF here):