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Marc Stiles
Real Estate Editor

May 26, 2005

Real Estate Buzz: 3rd time not the charm for Olive 8

By MARC STILES
Journal Real Estate Editor

Frustration briefly boiled over but then returned to a slow simmer at City Hall Tuesday during the Downtown Design Review Board's third perusal of R.C. Hedreen Co.'s Olive 8, a 36-story retail/hotel/condo project.

The Seattle-style tension — palpable but with no outbursts — underscores the challenge the five board members frequently face.

Their mission — to help proposed projects improve their neighborhoods — is straightforward. But it can get sticky when board members who are architects or developers review projects they might be competing against. In a town this insular it can be a huge challenge.

At an earlier board meeting, members had raised questions about Olive 8. Please come back, they said, and show us how you'll tie together the retail base, hotel and residential portions of the MulvanneyG2 design. Hedreen brought in noted New York architect Richard Gluckman to revamp the exterior. "It was very expensive," Hedreen President David Thyer says.

Gluckman came up with a blue and white glass curtain wall. At the base is a motif based on the artwork of Robert Mangold that looks like rolling eggs. The facade and base are "luminous and illuminating," Gluckman said, adding up to "a sleeker, more homogenous design."

Rendering courtesy of R.C. Hedreen Co.
Skanska has been selected to build Olive 8.

One board member, James Falconer, vice president of the Vance Corp., recused himself because Vance owns property near Eighth and Olive. The other board members praised the elegant and whimsical nature of the design, but they asked for another look and a more realistic rendering.

Thyer was visibly peeved. Immediately after the board's request, Thyer pointed out that board chairman Blaine Weber of Weber + Thompson Architects is working on competing projects, including Residences at Hotel 1000 at Madison and First, and the Samis/Opus Northwest project on Second Avenue between Pike and Pine streets.

The next day, Thyer emphasized he does not think Weber has ulterior motives and said he respects the overall process. Still, Thyer has concerns about design and developer professionals getting to judge competing projects. "I do think it's an issue."

Weber declined to comment, saying members are not allowed to talk about projects except during board meetings. But Vince Lyons, manager of the design review program, said Weber did not violate any standard. "I'm really concerned we not malign Blaine on this. He doesn't deserve it."

This question "comes up all the time. I think that's just the nature of the ball game," Lyons said, particularly in Seattle, which — despite its metropolitan feel — remains a small town.

It's no easy chore to come up with design review boards. "It's not rocket science. It's not mathematics," Lyons said. "It's people. It's relationships. It's design review."

Multiple appearances before the downtown review board are not rare. Designers of the new Four Seasons Hotel and WaMu Center met with the board five and six times, respectively.

Lyons says the bottom line is Olive 8 is not being delayed.

Thyer said he thinks general contractor Skanska still will be able to meet the Jan. 1 target, but "the timeline is getting tighter." And that's not a good thing in the increasingly competitive field of downtown residential development.

Wanted: the 'mass affluent'

If you've got an extra $125,000, a Kirkland businessman has an offer for you.

Chad Stevens, founder and CEO of a new company, Signature Destinations Club LLC, bills his company as "the first and only regionally focused" luxury residence club. Next month, it's opening six homes in the Northwest, the company's first regional hub. Ultimately, the plan is to have 125 homes in nine areas around the country plus several international destinations.

Signature Destinations' one time membership fee is $125,000 with 80 percent refundable upon resignation. Members pay $8,500 annual dues to cover the club's operating expenses, including taxes, insurance, utilities and maintenance.

For that, you'll get 56 days a year in homes that average 2,500 square feet. The average home costs $750,000 and is appointed by leading interior designers. In the Northwest residences are in places like Whistler, B.C., the San Juans and Bend, Ore.

The concept is inspired by National Association of Realtor statistics that show the median distance between a vacation home buyer's primary and secondary residence is 49 miles. Signature is targeting what's known as the "mass affluent." Census data show there are more than 5 million such households nationally.

Let's not forget Kauai

Not all "mass affluent" vacationers in the Northwest are sticking close to home. Many are headed to Kauai.

Windermere Real Estate reports West Coast buyers — many from the Puget Sound region — are leading "an unprecedented boom" in the island's real estate market.

Data@Work, a Hawaiian resort residential market research firm, shows Northwest residents make up the third largest buyer market for all resort properties on the island.

If you think real estate prices are ballooning in Seattle, check out Kauai. The average price of resort properties has soared 45 percent in the past two years. Over the past five years, resort property has appreciated more than 21 percent, with the average residential price increasing from almost $300,250 in 1999 to nearly $622,900.

Please, don't upset the dentist

It's funny what a trip to the dentist can turn up. The Buzz, for instance, learned that the Medical Dental Building at 509 Olive in downtown Seattle is about to be sold.

Between the "hmmmm, that molar might need some work" and other anxiety-causing asides came laments from the dentist about the sale. He said he'll be "really upset" if they turn his building into condos, too. Not what you want to hear when someone's poking in your mouth with sharp instruments.

CB Richard Ellis' Paul Carr and Don Fosseen are handling the sale of the 332,000-square-foot building for owner Harsch Investment Properties. Carr declined to comment.

But the rumor mill suggests the good dentist can relax. There's no conversion plan. That's good news for the Buzz, who has to go back for some drilling and filling.


Got a tip? Contact DJC real estate editor Brian Miller at brian.miller@djc.com or call him at (206) 219-6517.


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