Tue. Jun 25th, 2024

Lake Union seeks amendments to Seattle’s conversion rules

By meerna Jun12,2024

Lake Union Partners believes it can convert outdated offices in Seattle’s Pioneer Square into more than 2,000 homes if it can buy the buildings and if the city lowers fees for developers.

A local developer is set to convert offices in the historic district into homes, but only if the city adopts legislation creating “broad and comprehensive exceptions” to barriers to redevelopment projects, the Puget Sound Business Journal reports.

If successful, Lake Union would transform Seattle’s first settlement into a primarily residential neighborhood.

“We believe that within seven to 10 years we can bring 2,000 apartments to Pioneer Square, which is about 3,000 people,” Patrick Foley, managing partner of Lake Union, told the City Council committee.

The developer doesn’t own any of the development targets but is working on them, Foley said. Pioneer Square is “the most exciting and best place to convert an office into an apartment because… the (smaller) floor plates are properly positioned for that,” he added.

According to the Office of Community Planning and Development, Seattle Mayor Bruce Harrell has proposed a downtown activation plan, a nationwide rezoning for offices and retail by creating “broad and comprehensive exceptions” to rezoning barriers.

Transformations are expensive and the regulations aim to reduce fees. Foley told the Business Journal that conversions can cost twice as much as new construction. He said the proposed regulations were “absolutely crucial” in enabling office-to-home conversions.

“It’s going to be a heavy lift and it can’t just be done by our company,” Foley said.

Under the proposal, the redevelopments would be exempt from the city’s mandatory housing affordability fees, which developers pay in exchange for being allowed to build larger projects with more rentable square footage.

“(It) is one tangible way to reduce costs to be competitive, so we have actually made some conversions,” Geoff Wentlandt, head of the planning office, told the committee.

The Planning Office and developers are enthusiastic about the adaptations, which, according to the mayor’s office, are intended to attract downtown residents to fill the gap left by office workers working from home. Both sides are working on the bill.

However, such conversions raised concerns for the committee. Councilor Cathy Moore asked who would be able to afford to live in the converted apartments.

“I think it’s going to be high-wage earners, and that’s not really a population that we so desperately need to focus city subsidies and resources on,” Moore said.

Wentlandt, however, pointed to data that Seattle collected last year as part of a city competition for proposals for office-home solutions.

The winner, from Hybrid Architecture and developer Great Issues, was a plan to transform the century-old Mutual Life Building at 605 First Avenue in Pioneer Square into a one-bedroom rental apartment. The owner of Diamond Parking does not plan any reconstruction.

Target rents included in competition entries ranged from $950 for small commercial units with shared common areas for cooking and laundry, to one-bedroom apartments in the $2,000 range, which the planning manager said was in line with market rates for middle incomes.

Lake Union Partners, founded in 2009 by Foley, Joe Ferguson and Tyson Feaster, has developed commercial properties in Seattle, Portland, Salt Lake City and Denver, with a focus on multifamily, historic preservation, and creative offices, according to its LinkedIn page and hotels. .

— Dana Bartholomew

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