March 31, 2000

Martin Smith plans another Millennium Tower-type project

A Seattle developer has launched plans to build an office-and-condo tower of about 35 stories between the Paramount Theater and Interstate 5 on the northeast edge of downtown Seattle.

A partnership led by principals of Martin Smith Real Estate Services has tied up the vacant, half-acre plot at 919 Pine St. known as the "triangle site," confirmed Greg Smith, one of the principals. The group envisions creating 200,000 square feet of offices topped by at least 130 luxury condominiums.

"It's a Millennium Tower-type structure, with ground-floor retail, office and condos," said Smith, referring to the project a Martin Smith partnership has under construction on Second Avenue, north of Pioneer Square.

The proposal has a long way to go before becoming a reality.

The partnership has to complete negotiations to buy the land from Kabuto International Corp. of Japan, which acquired the property in 1993 for $1 million, according to King County property records. Smith declined to identify Kabuto's price, but judging from prices for land nearby, it could reach $20 million.

The group expects to start the often year-long city permitting process "very soon," Smith said. The partners then would have to arrange financing for the project, which would cost more than $100 million to build. Construction would then take up to two years.

Some members of the Pike-Pine Urban Neighborhood Coalition, for example, contested the blocking of views by the state convention center expansion, which is under construction less than a block west of the triangle site. Opposition caused the convention center to promise the neighborhood $680,000 in "mitigation" funds.

Capitol Hill resident Jill Janow, who will compete with other candidates for chair of the Pike-Pine Urban Neighborhood Coalition in a May 3 election, said she'll fight to keep the view open from Four Columns Park (above I-5 at Pike Street) to the Space Needle. The triangle site sits right on that line immediately across I-5 from the park.

Seattle City Council members have directed Janow to the Department of Design, Construction and Land Use, where she has asked that design review boards for the Denny Triangle and the Denny Regrade insist that any new high-rises be designed to "step back" out of the view corridor.

"My objective is not to stop progress," Janow said. "My objective is to keep Pike-Pine from getting walled off and to keep an aerial boulevard. . .some sort of breathing space."

The Denny Triangle is already zoned for high-rise development, however. In fact, the city in 1998 increased the acceptable height to almost 400 feet by creating a program of transferring development rights. The program allows developers to buy rights from rural King County property and apply them to Denny Triangle projects that create housing.

Smith said he hasn't grappled with the view issue yet but he noted that his proposal, which would utilize the development rights program, is within the zoning.

"I think the neighbors are aware of what the zoning is," Smith said. "The city just finished a public process where they did the zoning for that."

Smith's tower for the triangle site joins a growing spree of new proposals for both offices and housing in and around downtown driven by extremely low office vacancy rates and increasing interest in downtown living.

A number of those proposals are for the blocks close to Smith's triangle site. In fact, so many projects are being considered there that it could be tagged as a phenomenal growth area, except that similar development explosions are happening all around downtown's periphery.

Expansion of the convention center is a huge draw for other developers. The expansion includes construction of a 300,000-square foot office tower by Trammell Crow Co. and a 450-room hotel by R.C. Hedreen Co.

Hedreen is also actively planning a 32-story office-and-residential tower at Eighth Avenue and Olive Street and, to come later, up to three more office buildings kitty-corner from that on the Greyhound Bus Terminal block.

Investors, led by developer Melvin Brady, already hold city development permits for a 350,000-square-foot office tower and a 32-story residential tower on the Camlin Hotel block on Olive, between Eighth and Ninth.

Brady's plans include renovating the Camlin Hotel. He said he's negotiating financing and shooting to start construction by the end of this year.

Developer Continental-Bentall has one 30-story luxury apartment tower under construction nearby at Seventh and Olive, with two more similar towers on the drawing board. That would create a huge supply of high-rise luxury units for an area with essentially no housing now.

Smith bets demand will exceed even that supply.

"There's 3 million square feet of offices under construction now (excluding numerous projects still in planning) that aren't occupied yet," Smith explained. "That means at least 15,000 jobs that are going to be created in downtown, and that's high-paying jobs."

Some will pay plenty to be able to walk to work, Smith said.