CHS has learned that Gerding Edlen has signed an agreement with Sound Transit that lays out, among other things, the terms of a $25 million land lease for the project site along Broadway between E Denny Way and E John.
In March, a representative for the Portland-based developer told CHS the two sides were “really close” to signing a so-called term sheet. The preliminary agreement sets the terms for Gerding Edlen to lease three sites from Sound Transit and purchase the fourth, where Capitol Hill Housing will build an 86-unit affordable housing development.
“It took more than a year for them to negotiate the term sheet, in large part because structuring a lease instead of a purchase and sale proved complicated,” said Brie Gyncild of the Capitol Hill Champion, a community group that has worked for years to insert neighborhood priorities into the project.
Sound Transit has said the land was worth around $25 million and that Gerding Edlen was aiming for a 75-year deal to lease the properties.
Gerding Edlen, which was selected last year to develop the “transit oriented development” project, will still need to sign a final contract with Sound Transit before an 18-month design phase gets underway. Because of the federal grants involved in the project, the Federal Transit Administration must approve the deal. Then Gerding Edlen will begin the process of taking its projects through design and environmental review. As part of the community guidelines agreement, the developer will also benefit from a somewhat streamlined design review process.
“Now that the term sheet is signed, they’re working out the details on the contract and aiming to have it go to the Sound Transit Board’s July meeting for approval,” Gyncild said.
Construction is expected to start in 2018.
Meanwhile, two grocers are still vying to occupy the anchor tenant space in the project that will include 100,000 square feet of commercial, housing, and community space. After CHS reported that Portland-based grocer New Seasons was an early frontrunner to takeover the space, Capitol Hill-born Central Co-op announced it too would throw its hat in the ring. Central Co-op’s bid to open a second location recently got the endorsement of Council member Mike O’Brien.
Part of the development also includes a retail “bazaar” at Site A-North called The Market Hall and envisioned as “a mix of local retailers, served by booths of varying sizes to accommodate the start-up entrepreneur as well as more established specialty retailers.”
The opening of UW Station and Capitol Hill Station has boosted light rail’s popularity to new highs as average weekday ridership estimates near 60,000 daily riders. The light rail station and the 3.1-mile U-Link subway line between downtown and the University of Washington via Broadway opened in March. For now, the TOD sites remain paved over and fenced-off empty space.