August 9, 2001
Urban development versus the public process
By JOHN L. JACKSON
What would the Smith Tower or the Space Needle look like if they were required to go through today’s public process? Would they get built at all?
Over the last few decades, real estate development has evolved into a highly inclusive process. In addition to the complexity of evaluating the financial feasibility, site conditions, market timing, suitability of use, availability of utilities, traffic impacts, access and constructability of a given project — and matching them to the municipality and its zoning and codes — our system today allows for a tremendous amount of citizen input. No longer do market demands, property ownership and “as of right” necessarily determine what a developer can build.
Within urban settings, the vast number of interested parties — many of whom have conflicting interests — further complicates the process. In Seattle’s case, this adds significant risk and has changed the face of who does development today.
No longer is development the business of the entrepreneur. Most urban development is now done by institutions, which are made up of well-funded professionals who can withstand the long-term processes and the financial risk. Development teams, by necessity, must include a vast array of professionals with expertise in everything from environmental issues to public process. These team members work together to navigate the maze of overlapping — and sometimes conflicting — regulations and interests of numerous governmental and political entities, community groups and individual private citizens.
Different public processes
The public process is different in each jurisdiction. One of the immutable keys to success, however, is working well in advance with all of the groups that may be affected by a project. It helps developers anticipate the needs of the community while determining project feasibility and gathering support for the project. It can also result in changing the initial concept to meet the needs of various constituents while addressing the market’s needs.
In the city of Bellevue, there is relatively little public involvement in the development process. Once feasibility is completed, a project can proceed through the environmental and design review processes, permits can be issued and the project can be built.
Although public involvement was not required at Bentall’s Summit project in Bellevue, our early meetings with business organizations, community groups and neighbors helped us formulate the timing and staging of the project.
In the Bellevue market, it is clear that a campus-like project made up of three distinct buildings with a central common area was more desirable than a high-rise office building. The net amount of space, 850,000 square feet, is roughly what could have been built in one high-rise, but the smaller-profile project not only meets the city’s goals for the site but also allows the project to be brought on line in response to market demand.
Bellevue’s timely permit process has allowed the project to proceed on schedule for delivery to the market in September 2002. Given current market conditions, being the first of the new properties to open is crucial from a marketing standpoint.
In Seattle, on the other hand, we are currently in the design review process for a project — or what may become several smaller, individual projects — slated for the Denny Triangle.
In keeping with the Denny Triangle neighborhood plan’s and the city’s goals for increased office space, housing and open space, the initial project was slated to be a full-block, mixed-use development that would include retail, office, housing, underground parking and a large open public plaza. In addition, a significant number of transfer of development credits (TDCs) will be purchased from King County, allowing for additional project height in exchange for the preservation of open space and limiting suburban sprawl.
Prior to issuance of a master use permit, projects of more than eight units of housing must be reviewed by Seattle’s Design Review Board. Based on that board’s recommendations for design alternatives, both with and without alley vacations and with alternative proposals for open space, months have been spent developing new designs for the project that must be reviewed prior to approval — a lengthy and subjective process.
This project also highlights another set of conflicting priorities: the Denny Triangle neighborhood plan’s mandate for density, and the First Hill neighborhood plan’s preference for maintaining views. Although views are not a subject over which the board has jurisdiction (views fall under environmental review or SEPA), much of the testimony at design review meetings has focused on the issue of views of the Space Needle from Four Columns Park on First Hill. The issue is now before the City Council for resolution. The outcome will have a profound impact on the course of development in the city for years to come.
For the record
Not that citizen participation and input are new to Seattle, but the results have been mixed.
In the 1970s, the city government and a significant number of business leaders wanted to tear down the Pike Place Market to provide sufficient parking for downtown businesses. Public involvement saved the market, and I doubt there are any who would not consider this gem a significant city asset.
In 1986, developers bought a permitted site for what is now the US Bank Centre. It was initially permitted as standard box-like high-rise with ground floor retail that would be completely overshadowed by an office tower. Wishing to make significant changes to the building, the developers went back through the public process and negotiated with the city to create a building that would meet more of the common public needs, including open space and a permanent art display. Fifteen years later, such authorities as the Urban Land Institute consider it a model for metropolitan urban development — a treasure for the city and its citizens — yet it was a financial disaster for its developers.
More recently, Pacific Place was the subject of a massive debate over the city financing involved in the project but it could not have been built without public participation. The project in turn was the catalyst for the redevelopment and rejuvenation of Seattle’s downtown core and brought hundreds of jobs to the city as well as contributing significant tax revenues to the public.
Most of us in the development industry are resigned to the public process. We all encourage public involvement, however, we would like to see a process with clearer rules and defined timelines so that we don’t continuously run the risk of the process dragging on indefinitely at costs that can kill a viable project and ultimately damage a community’s economic viability.
John L. Jackson is the vice president of development for Bentall US. Since 1979, he has directed the development of more than 2 million square feet of office, retail and high-end residential development in the Seattle area.
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