Hotels on the Horizon

With the announcement of McMenamins winning the bid a few weeks ago for the Old City Hall building, everyone seems to be making announcements for new and upcoming hotel projects for Tacoma's future. 

Almost eight years ago, Bellevue's Silver Cloud Inn and Hotels announced that they would be developing an 180 room hotel on Point Ruston, and it has just been announced that construction is finally underway. The delay can be attributed to a slow moving recession coupled with disputes over land-use permits with the City of Ruston. Bellevue's Silver Cloud Inn and Hotels is set to open in 2018 and planned to include one restaurant, a ballroom, meeting rooms, a pool, an exercise room, and a parking garage. 

There are two other major proposals on the table for the future of Tacoma's tourist and business industry. A Chinese investment group, who is still gathering investors, is interested in creating a 24-story, 300 room high rise. It is proposed that this would be a convention hotel along with a condominium complex. The second is coming from Hollander Investments and they have their eyes on the Thea Foss Waterway. Hollander and Investments is planning to build a hotel and an office complex. The first of the buildings to go up will be a nine-story Marriott Residence Inn that will provided 104 rooms. Ground breaking dates have not been set yet, Hollander and Investments are waiting to see how the other proposed hotels do before starting construction. 

If everything goes as planned Tacoma can expect to see five new hotels, at least one more condominium complex, and an increase in office spaces and store fronts in the next few years. Tacoma truly is the City of Destiny and is planning on making a large impact on Tacoma's small business and local economy. 

ead more here: http://www.thenewstribune.com/news/business/article49463305.html#storylink=cpy

Read more here: http://www.thenewstribune.com/news/business/article49463305.html#storylink=cpy

State Lottery Funds Downtown Revitalization Efforts

Governor Christine Gregoire announced at last Friday’s City Center Luncheon her commitment to follow through on $700,000 pledged from the state's Strategic Reserve Fund, funded by unclaimed state lottery winnings, to help retain and grow business in Tacoma. The money was originally committed as part of the Russell Investment Global Headquarters proposal for clean up of the Sauro Dry Cleaners site at S. 14th and Pacific Ave. in downtown. Hazardous soil and contamination on the site was removed this past fall.

The state funds will be used for additional infrastructure investments, making the Sauro site ready for redevelopment and expansion of the DaVita Inc. campus. Currently, DaVita employees are spread between the old Shoenfeld Building at S. 15th and Pacific Ave. and the Columbia Bank Building on “A” St.. DaVita is expected to add more than 350 jobs in Tacoma in the coming years.

Retail Recruiting- IDA Conference Part 1

I am in Milwaukee, Wisconsin this week at the International Downtown Association Conference. The conference, hosted each year by a different city U.S. or Canadian city provides lectures and conversations on downtown retail development, safety and security, creating great public spaces, parking management and urban design. I’ll be reporting over the next couple days on what I learn.

It’s comforting to know that when it comes to downtown retail, Tacoma is not alone. Milwaukee, a city of nearly 600,000 people has blocks of vacant store fronts and towers of vacant office space just like us. However, Milwaukee is taking bold steps to combat their downtown vacancy rate and rejuvenate their street life. In addition to a city branding campaign and functional wayfinding system, Milwaukee has hired retail consultants, CivicVisions not to just revitalize downtown retail, but to transform downtown through strategic retail recruitment.

We all know that amenities attract people, but it’s attracting the right mix of amenities to downtown that’s tricky. To do this, Milwaukee’s consultant CivicVisions suggests:

· There is not quick fix to retail recruitment. A downtown retail strategy is a long-term plan that is implemented over three to five years or more.

· Define a distinct geographic area of downtown to attract retail to. Do not try to attract new retail everywhere at once.

· Hire a trained retail recruiter who is familiar with our community and committed to it, has plenty of retail and merchandising experience, and is good at both building relationships and selling the community’s vision.

· Identify the type and quality of businesses you want and be discerning about the ones you go after. Businesses attract other like-businesses, but the wrong business can inhibit recruitment of the ones you want.

· Property owners must be part of the solution and help to develop a strategy that incentivizes the right mix of retail services and amenities.

· Façade updates that modernize buildings and improve merchandise displays will likely need to be part of the strategy.

This makes sense to me. Maybe it’s time for Tacoma to try out a retail recruiter again…

Parking Requirements (or not) in the IFSA

The Planning Commission heard recommendations last week from the City Council’s Environment and Public Works Committee and the City Manager to eliminate parking minimums and maximums in the International Financial Services Area (IFSA) downtown. The draft amendment was approved to move forward by the Planning Commission, and they will hold a public comment session on February 4th. The City Council is expected to hear public comment on the proposal in April.

The IFSA, as you might guess, is the area between 8th and 15th, Commerce Street and I-705. So what does this recommendation mean? Basically, there are current minimum and maximum parking requirements for new development, and lifting those regulations would allow for a market-based approach to determining the number of off-street parking stalls that accompany new development in the IFSA.

And why might this change matter? The proposal cites two overarching reasons. The first is that eliminating parking minimums and maximums in this area would be an added draw for potential developers. Land availability, strict development restrictions, and limited parking options are common challenges for those looking to develop in urban areas, and this could provide an additional incentive to move to Tacoma.

The second reason is largely environmental. The proposal follows the City’s Green Ribbon Climate Action Task Force recommendation to focus planning and zoning decisions on reducing greenhouse gas emissions. Eliminating parking minimums will discourage single-occupancy vehicles and encourage transit and non-motorized transportation, which is good for business as well as the environment.

The Planning Commission Public Hearing will be February 4th at 5:00 pm at the City Council Chambers in the Tacoma Municipal Building (747 Market Street, 1st floor). Click here for more information.

Towers on the Foss Clear Another Hurdle

In a planning process that began in March 2004, the Washington State Department of Ecology recently approved an amendment to Tacoma’s Shoreline Master Plan that allows for 180 foot towers to be built on the west side of the Thea Foss, north of the Murray Morgan Bridge. The property in question is owned by SimonJohnson LLC who has proposed to build up to four mixed use towers on the site. SimonJohnson is interested in possibly providing space for residential, commercial and retail tenants in the development as well as providing for parking and recreational uses.

The approved height increase is conditioned on a number of details including; providing enlarged view/access corridors, maintaining an average distance of 100 feet between the tower portions of the development and developing 50% of the roof as usable recreation space. The amendment also reduces the height limit to 90 feet on the municipal dock site adjacent to the Murray Morgan Bridge, clarifies the design review responsibilities of the Thea Foss Waterway Development Authority, protect the view of Mt. Rainer from Fireman’s Park and clarifies the regulation overall.

City Seeks State Funds for Downtown and Dome District Improvements

The Tacoma City Council has announced plans to pursue Local Infrastructure Financing Tool (LIFT) funds from the State of Washington. As part of the LIFT requirements the Council has proposed to designate downtown Tacoma and the Dome District as a Revenue Development Area (RDA).

LIFT is a variation of Tax Increment Financing (TIF). Although TIF is used in 48 states, the Washington State Constitution prohibits the lending of state credit, and thus the TIF tool. In other states TIF is a method for local jurisdictions to leverage future gains in property taxes to invest in current infrastructure improvements and other economic development initiatives. TIF harnesses the increase in property tax revenue from a growing and redeveloping area to repay bonds that financed the improvements.

Alternatively, LIFT is a community development tool that was approved by the Washington State legislature in 2006. LIFT allows selected local governments to take advantage of tax revenue generated by private investment in a designated RDA to make payments on bonds used to finance public infrastructure improvements. Specifically, LIFT provides up to $6 million annually in redirected state retail sales taxes to help pay for public infrastructure projects that are funded with at least an equal amount of local redirected property taxes. The redirected property tax must be comprised of new regular property tax revenues from new construction within the RDA.

If Tacoma is selected for LIFT funds, up to $1 million per year for 25 years could be invested in infrastructure projects in downtown and the Dome District. The City anticipates designing and constructing the following public improvements in the RDA:

• Structure(s) to accommodate 1,500 parking spaces


• Right-of-way and streetscape improvements including; streets, sidewalks, crosswalks, lighting, landscaping and traffic controls


• Utility infrastructure


• Sustainable storm drainage

Total costs of the proposed improvements are estimated at $72.3 million. The City will invest approximately $45 million (62%) from its Parking Fund, the Real Estate Excise Tax, the Sewer Enterprise Fund, and local property taxes generated from new development in the RDA. It is anticipated that $14 million (19%) of Federal funds would be appropriated for this project. Beginning July 1, 2011, LIFT funds projected to be generated over 25 years would be used to repay a General Obligation Bond, which would yield an estimated $13.3 million (18%) in net proceeds. LIFT would be used primarily for parking infrastructure as well as right-of-way and streetscape improvements.

The City anticipates that the projected investment in public improvements will act as a catalyst to attract at least $400 million of new private investment in office development and the creation of approximately 2,000 well-paying jobs in international financial services, which is a key industry cluster for the City of Tacoma and the State of Washington, and other fields.

The City Council will hold a public hearing on this isue Tuesday, June 10th, 2008 at 5:30 pm at the City Council Chambers, 747 Market St., 1st floor. The public is invited to comment at the hearing or to submit written inquiries or comments prior to the meeting.

For further information, call or e-mail Bob Levin at (253) 591-5039 / robert.levin@cityoftacoma.org 0r Elly Walkowiak at (253) 591-5209 / ellen.walkowiak@cityoftacoma.org in the Private Capital Division, City of Tacoma Community & Economic Development Department.

The proposed ordinance may be viewed at www.cityoftacoma.org/RDA.

Russell Hires Top-notch Public Affairs Rep

Russell Investment Group's announcement last week about hiring Patricia Akiyama to fill the position of Government and Community Relations Director is a welcome one. As community leaders move forward with Project Destiny, she is sure to be a key player for Russell.

Akiyama joins Russell after serving in similar roles for Quadrant Homes and the Weyerhaeuser Company; she also served as chief of staff for U.S. Senator Patty Murray for four years in the late 1990s and was senior staff coordinator for WA House of Representatives Co-speaker Frank Chopp.

Akiyama has a B.A. degree from the University of Oregon (Eugene) and is a graduate of Leadership Tomorrow, the Greater Seattle Chamber of Commerce’s Alki Political Involvement Institute, and the Program for Senior Managers in Government at Harvard’s John F. Kennedy School of Government.

At Russell, Akiyama will focus on legislative issues, as well as relationship management with local and national lawmakers, administrative agencies, and industry associations.

The Ups and Downs of City Center Development

Development in downtown Tacoma often proceeds in fits and starts, as revealed in the following announcements made this week:

• The Tacoma Housing Authority (THA) is close to reaching an agreement with the State of Washington on purchasing the Rhodes Center--in part for the income it would generate as an office building. THA would retain the Court of Appeals, Labor and Industries, the Auditor’s Office and the Department of Transportation as tenants, and the agency would act more aggressively to fill some of the vacant commercial space. The purchase would include not only the old Rhodes department store building, but also another building on Market Street and the 530-space parking garage.
• The Foss hotel project sought and won yet another delay from the Foss Waterway Development Authority;
• Prium Companies now say they need a year’s postponement to buy land for a mixed-use office and residential project near the S. 21st St. bridge;
• The Foss Harbor high-rise complex, north of the E. 11th St. bridge expects that getting the necessary approvals from the State of Washington could take another 14 months.

The BIA would welcome a new owner for the Rhodes Center. The State of Washington has opted out of paying the BIA assessment for the building.

Downtown Tacoma: Filling in the Gaps (2008)

The current vacancy rate in downtown Tacoma’s Class ‘A’ office space is less than one percent; despite the current slowdown in the economy and resulting impacts to downtown development, some local investors see this high rate of demand as an opportunity. This quarter’s City Center Luncheon presents a panel discussion showcasing projects and prognostications from three local investors:

• Don Arsenault of Arsenault Realty Advisors (developer of Atrium Court);
• Ron Gintz of the Gintz Group LLC (developers of the former Mecca Theater and Old City Hall);
• Dan Putnam of PCS Structural Solutions (principal in Pacific Plaza LLC).

As always, this quarter’s meeting will highlight projects in the vanguard of downtown’s revitalization, introduce the people who are leading that process, and help delineate current trends and opportunities:

Friday, January 11th
11:30 a.m. to 1:15 p.m.
The Tacoma Club
Sponsored by Venture Bank

Attendees will also hear about new efforts to market downtown to developers and tenants, as well as a sneak preview of Destination Downtown Door-To-Door.

Cost for the event is $25 for members pre-paid and $30 for non-members pre-paid; corporate tables are available at a discounted price. To reserve space at this meeting, please contact Janice at the Chamber, (253) 627-2175 or janice.hutchins@tacomachamber.org.

Downtown Tacoma: Filling the Gaps

The Tacoma City Council envisions a broader but denser development pattern, linked by streetcars. Project Destiny looks forward to the Russell Investment Group occupying 1.2 million square feet in a new corporate headquarters, the jewel in a "re-positioned" downtown that is attractive and affordable to other corporate offices, as well. The BIA continues to encourage "more feet on the street" as the district prepares to kick off its third decade of service.

These are all facets of the same goal--to fill in the "dead spots" in downtown's built environment with more housing, shopping, offices and visitor attractions. Despite the very real success of local leaders since the mid-1990s, that remains a challenging assignment.

The superheated (some now are suggesting the term "overheated") downtown housing market of the past few years is finally cooling, but there's no consensus yet on how cold that trend will turn. There are some recent signs that at least a small rally may be developing, but sales have plummeted.

Next week's City Center Luncheon will present a panel discussion that may shed more light on future trends in the market but, for now, John Gillie's comprehensive feature in Sunday's edition of The News Tribune is a good snapshot of the current state of key developments. Gillie's "status check" of downtown projects tells him that 2008 can expect"a more measured pace of development,...more rental units instead of condos,...more office space construction and...more affordable condo conversions."

Tighter credit and slowing absorption of unsold units, Gillie contends, have caused developers "to slow down projects, redesign them to better fit market realities in Tacoma, and to slim the designs to make those projects more affordable in a market where construction costs have climbed steeply."