May 13, 2016

Seattle ‘exploring other options' for Civic Square redevelopment

Courtesy GGLO and Foster + Partners [enlarge]

Triad’s proposal from 2007 was a 43-story tower with office, housing and retail. The city also wanted a public plaza on the site.

Seattle Mayor Ed Murray said yesterday the city is “exploring other options” for the Civic Square site because the developer, Touchstone, has been unable to get financing for a long-planned project there.

The full-block site is bounded by Third and Fourth avenues, and Cherry and James streets.

Triad Development was chosen by the city in 2007 to develop Civic Square, but in March Triad asked to transfer its interest in the project to Touchstone.

That came after Murray announced last fall that the city would shelve its agreement with Triad after allegations surfaced that a Triad employee attempted to coerce a Seattle City Council candidate, Jon Grant, into settling a lawsuit against the developer that was related to the project.

The city gave Touchstone 60 days to find the right mix of office, residential and commercial space that would make the project appealing to investors. That deadline was Wednesday.

“I appreciate Touchstone's efforts over the last two months. Unfortunately, no parties have been willing to commit capital to finance the project,” Murray said in a statement Thursday. “As we look forward, we will need to diligently assess whether the project as designed is viable or whether adjustments are needed.”

Seattle-based GGLO and the British firm Foster + Partners designed Triad's proposal, with Skanska USA Building as the general contractor.

The current plan calls for a 43-story tower with office, housing and retail. The city also wanted a public plaza on the site.

Fred Podesta, Seattle's Finance and Administrative Services director, said in a statement that the city would not discuss contract issues.

Touchstone's A-P Hurd did not return a request for comment.

Daniels Real Estate is developing The Mark, a 44-story tower with 528,000 square feet of office space and a 184-room SLS Hotel, about a block away from Civic Square at Fifth and Columbia. Kevin Daniels said he is not surprised that Touchstone struggled to finance Civic Square. Despite the hot real estate market in Seattle, it is tricky to finance a high-rise office project, especially one without tenants.

Daniels' tower is under construction now, as well as Schnitzer West's 36-story office tower at Fifth and Madison.

Daniels said he would prefer to see a park or public plaza on the Civic Square site. He said the city could create a place like London's Hyde Park or Union Square in San Francisco.

“I see this as a once-in-a-lifetime opportunity for the city of Seattle to create a civic plaza and not fill it with buildings,” he said. “How often in a city's history do we have a chance to put in a full-block city park on land that is already owned by the city?”

If the city still wants to pursue a high-rise structure, Daniels said he thinks something a little less dense with more open space would make sense.

Housing is going to be tough there, he said, because every lender and developer is waiting to see what Crescent Heights Inspirational Living will do with the massive project it is has proposed at Fourth and Columbia.

Crescent Heights' latest plan is for a 100-story structure with 1,020 housing units, 100 hotel rooms, 85,000 square feet of office space and 20,000 square feet of retail.