Post navigation

Prev: (08/07/19) | Next: (08/08/19)

Mayor Durkan’s $143M ‘Mercer Mega Block’ deal: Tons of new development, some affordable housing, and a new South Lake Union community center

Mayor Jenny Durkan has a $143 million deal in place that will create 175 affordable apartments and a new 30,000-square-foot community center as part of a massive sale of city property in South Lake Union:

Mayor Durkan has transmitted legislation to the City Council to move ahead on the agreement with potential buyer Alexandria Real Estate Equities, Inc.,  the first and longest-tenured which owner, operator, and developer of collaborative life sciences campuses in key urban innovation clusters. Alexandria has supported the Seattle life science cluster for more than 20 years with a number of notable office/laboratory properties, including the Lake Union Steam Plant at 1201 Eastlake Avenue East, the Juno Building at 400 Dexter Avenue North, and its most recently completed development at 188 East Blaine Street.

The nearly $300 million in public benefits that the City of Seattle would receive from Alexandria include:

  • $143,500,000 cash at closing, including a $5 million contribution to support strategies that address homelessness in Seattle;
  • 175 units of affordable housing on site that are affordable for families earning up to 60 percent of the area median income ($66,400/family of four) and will remain affordable for 50 years without any public subsidy;
  • A new 30,000 square-foot community center located on site that will be operated by Seattle Parks & Recreation with rent waived for up to 40 years;
  • Transportation improvements including the extension of 8th Avenue as a pedestrian right-of-way through the site between Mercer and Roy, and the extension of the two-way protected bike lane on the north side of Mercer Street between 9th Avenue and Dexter.

‘The city says the proposal includes “$300 million” in community benefits. As for the cash, the mayor’s proposal has a plan for that, too:

Of the $143,500,000 in cash proceeds the City would receive from the sale, Mayor Durkan is proposing to:

  • Invest $78 million in housing uses, including:
    • $57,200,000 to address displacement and create opportunities for equitable transit-oriented development through a strategic property acquisition fund and revolving Equitable Development Initiative (EDI) acquisition loan fund;
    • $15,000,000 to increase investments in permanently affordable homeownership; and,
    • $6,000,000 for a new financing tool to create more affordable accessory dwelling units like backyard cottages and in-law apartments for low- and middle-income homeowners.
  • Invest $16.7 million to support new and planned transportation projects to improve safety and increase options for getting around Seattle.

Mayor Durkan surfaced the plan last month at the Capitol Hill announcement of a new $50M affordable “Housing Seattle Now” plan.

The properties include three parcels comprising of 2.86 acres of land in the South Lake Union neighborhood. Since 2014, the City has been in discussions on how to best utilize the properties to benefit all of Seattle. Last October, the City Council approved legislation that prioritized affordable housing in all sales of city-owned land.

Development of the Mercer properties could produce around 1,300 new homes — under the proposal, about 13% would be affordable.

The City Council will now take up Durkan’s “Mercer Mega Block” proposal and wrangle over details of the legislation.

Subscribe and support CHS Contributors -- $1/$5/$10 per month

2 thoughts on “Mayor Durkan’s $143M ‘Mercer Mega Block’ deal: Tons of new development, some affordable housing, and a new South Lake Union community center” -- All CHS Comments are held for moderation before publishing

  1. So disappointing. PRIME, PRIME real estate and an opportunity to create many hundreds of great affordable housing units and the city will facilitate just 175 units?! We must all ‘scream’ loudly to City Council and Do-too-little-Durkan that they need to increase the height and scope of the affordable housing component. I am so sick of hearing this city council whine and ask for patience while it doesn’t solve our housing crisis. they want to upsize the entire city instead of doing the needed upsizing and MINIMUM build heights needed in already dense areas in the middle of services, employment nodes and transport access. Seattle planners may be better than those in, for example, Montgomery, Alabama but they suck compared to what we deserve and need in this city. #Neophytes, squandering rare opportunities.

    • The money is not there to build apartment buildings dedicated solely to affordable housing (taxing large corporations or the extremely wealthy is taboo apparently), so the solution is to tack affordable housing on to standard housing.

      I agree that 175/1,300 is pretty abysmal though. Should be minimum 25%, closer to 40%.