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The Broadway redevelopment and underground parking garage that wasn’t

With news last week that the project to build mixed-use apartments in the empty lot at Belmont and Pine is once again underway, here’s a note on an apartment overhaul on the Hill that isn’t happening — yet.

CHS has learned that a year ago in November 2009, the Hong Kong-based investors behind the 200 Broadway East apartment building that also houses Bleu Bistro and American Apparel on its ground floor filed paperwork with the city to study the feasibility of creating underground parking as part of a potential redevelopment at the corner of Broadway and John.

Description of Work Pre-sub application to determine feasibility of underground parking garage in light of Sound Transit tunnel passing under the building.

200 Broadway East is the same building where the owners recently went to the media with their concerns that light rail tunneling might damage the $6 million, 1924 building. Sound Transit has said that building owners Broadway Investment LTD agreed on a +$200,000 easement agreement with the agency, one of nearly 200 such agreements Sound Transit has worked on along this line of light rail.

Franklin Tseng of Broadway Investement tells CHS that he currently has no plans to proceed with any redevelopment at the site. “The planning was only an exercise, and the property will not be re-built in the forseeable future,” Tseng said via e-mail.

That stretch of Broadway is still due to get a massive underground parking structure, however. The 230 Broadway project will include an underground parking garage capable of fitting more than 350 cars for the 235-residential unit building. CHS has reported that the project is planned to begin demolishing the buildings that currently house Bank of America, Noah’s Bagels and the now-empty spaces where Pho 900 and Cafe Septieme used to live in January 2011. The mixed-use development is planned to be completed in 2013.

While we wait, it looks like we’ll have to get used to paying higher street parking fees but won’t have to worry about paid parking on Sundays.

Back at John and Broadway, there won’t be any redevelopment underway soon but the Hill’s remaining old building’s had better watch their back — things are heating up again. The Summit building was recently part of a major, $33 million real estate deal in the Seattle market fueled by speculation that “multifamily properties” will again be valuable investments:

Low vacancy rates, the lack of new supply in the next 18 months coupled with corporate headquarter growth in close proximity to all three properties helped drive the sale. “This deal continues the trend of core-Seattle properties trading at a premium,” states Zoffel. “Investors are aggressively underwriting, believing they are on the leading edge of an investment upswing, much like the scenario leading into 2005.”

Negotiating ploy or not, 200 Broadway probably won’t be the last potential redevelopment studying the feasibility of building an underground parking garage above Capitol Hill’s coming light rail tunnels.

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Hijinks Jack
Hijinks Jack
10 years ago

Interesting mishmash of development-related news tidbits.

Re your link to the Globe St. real estate investment Web site, I noticed these salient details about the referenced $33.3 million sale by a private investment fund of three apartment properties (The Summit on Capitol Hill and two properties on Queen Anne):

— The sellers took a financial hit. According to the article, the sellers originally purchased the three properties in late 2006 for $34.25 million, then poured an additional $4 million into renovations. Adding imputed interest and transaction fees, the private investment fund, based in Santa Barbara, didn’t fare well with its Seattle investment. I’d imagine the investment fund had visions of big-time profits from converting the rentals into condos, but we know what happened to that scenario.

— I think the buyers, described as an “undisclosed institutional investor” got a good deal, if they’re willing to make a longer-term commitment to Seattle. I can only imagine that Capitol Hill and Queen Anne Hill, already vibrant, dense, close-in neighborhoods, will become more appealing over the next 10 years. The one big caveat to my optimism: Too many “institutional investors” descending on our ‘hood who are not willing to make longer-term commitments, but instead look for quick-rich schemes.

This saga represents one of many unfortunate tales of what happens during boom-and-bust real estate cycles when money-grubbing RE investors try to game the system without regard to the welfare of the tenants who make their homes in these “investment vehicles.”

I have friends who used to live in The Summit Apartments, but were forced to move when the investment fund thought it was preparing for a condo conversion and wouldn’t issue lease renewals.

A true sense of community requires more stability and assurance in our home lives. Most big RE investors could care less about “community.” If too many of these investors encroach on our urban neighborhoods, they risk diluting — or even destroying — the urban vibe that attracted their investments in the first place.

Witness the tale of the Pine + Belmont stalled development, which a few years ago knocked down a block of fun, hip, and gritty businesses in order to try to construct a distinctly suburban-style apartment complex with franchise-retail storefronts. Instead, we got a desolate, long-term gravel lot. But, as CHS Seattle has reported, the developers and their low-rent architects (Weber Thompson), seem to be making moves to restart their project. So, I guess our choice boils down to gravel lot or suburban-style monstrosity, neither one of which helps create urban vibracy in my book.

I think our city government needs to enact much tougher tenant protections and design guidelines to strengthen a sense of community in our respective neighborhoods. Perhaps these protections can include incentive tax structures to encourage longer-term ownership of apartment complexes and discourage RE flips and condo conversions.

ProstSeattle
ProstSeattle
10 years ago

I used to live in the Summit Apartments, and I went through the remodelling process there. The new Granite group were horrible, absolutely horrible managers. I fully expected that they were going to have to sell this property soon. Most commercial properties have a 5 year balloon mortgage. The year that the Summit sold, the assessed value of the property was approximately $6.1 million dollars. The sale price of this property was over $11 million. Now, I know that assessed values are always lower than appraisals, but not that much lower. The remodelling was all lipstick and rouge. The new electrical that they put in was a joke, gfci instead of true rewiring. Chinese cabinetry, poor kitchen ventilation, the works. But they did have to spend some money on the remodelling. When you consider the sales price versus the purchase price, plus the remodelling costs per unit, I am very pleased Granite got shellacked. It is so nice to know that karma is still flowing in the universe. I’ve been waiting for this day for approximately 18 months, and I knew it was coming. It arrived.

Gern Blanston
Gern Blanston
10 years ago

Mr. Tseng’s “planning exercise” regarding building underground parking was nothing more than an exercise is squeezing more money out of Sound Transit for the privledge of tunneling under a couple feet of his building. It happens all the time. Property owner realizes he’s due compensation from public entity – he suddenly has grand plans for massive redevelopment and/or new development even though he’s barely changed the smoke alarm batteries in 10 years. But suddenly on paper he’s due much more compensation because of these grand plans that have zero chance of ever becoming reality.

Well played Mr. Tseng.

ProstSeattle
ProstSeattle
10 years ago

The property that the Crypt used to be in did the same thing. There was a development board up on 10th Ave. stating that they wanted to tear down and build a 6 story residential with xx,xxx sq. ft. retail facing Broadway.

I think that ST is smart enough by now to know that this is going to occur, and probably budgeted the amounts. I mean honestly, has anybody ever put underground parking under a standing 6 story brick building in this city? I can’t even imagine the engineering that this would entail, and the costs per spot would have been exhorbitant. I still think that we should say ‘shame’ Mr. Tseng. You may be part of the reason why the street car doesn’t go all of the way to Aloha St. Penny wise and pound foolish, kind sir.

Mel B
Mel B
10 years ago

“So, I guess our choice boils down to gravel lot or suburban-style monstrosity, neither one of which helps create urban vibracy in my book.

I think our city government needs to enact much tougher tenant protections and design guidelines to strengthen a sense of community in our respective neighborhoods. Perhaps these protections can include incentive tax structures to encourage longer-term ownership of apartment complexes and discourage RE flips and condo conversions.”

– I agree. how do you propose that our community begin to do this? re-write a stringer neighborhood plan? I am also interested in building a greater sense of community and ownership in Cap Hill. And I feel that massive developments like these fragment our neighborhoods and contribute to the overall decay of physical communication frameworks… and on top of this, they are ALWAYS aesthetically uninteresting and mismatched to existing built, cultural, social and economical environments…