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Bellevue abandons affordable housing in shiny Spring District

Lured by Wright Runstadt's suburban development jewel, Bellevue's commitment to affordable housing has, conveniently, vanished.

For all of us stuck in traffic purgatory, the expansion of light rail can’t come fast enough. The current system carries a small but growing number of passengers, but hope springs for a real shift when the system reaches more destinations. (The East Link line running across Lake Washington would add 10 stations and 14 miles to Sound Transit’s light rail system.)

The train is an alternative to the car/freeway, but also a means to something else: a more compact city, a grand scheme that began with growth management and now, perhaps, lies within reach. The more we choke on our own exhaust, the more attractive this alternative becomes.

How this pattern of development grows and evolves is not a trivial matter, not just to be discussed at conferences with planners in cotton pants and bike shorts.

 

Reader, you have skin in this game. Even if you never ride light rail, you should be rooting for its success — if for no other reason than to get potential future riders out of their cars, off the road and out of your way.

How to maximize ridership? One of the most important tools is to build housing and offices at new stations. There is a name for this — Transit Oriented Development or TOD. Sounds fancy, but it’s really just putting density around stations.

And yet, it's an idea that makes planners practically pee in their lycra. It adds riders to light rail and creates density all at the same time. The promised land of regional planning.

How is it going? It’s either moving forward or a burgeoning disaster. Take your pick.

Perhaps the best example of TOD in the Puget Sound area is a project just coming out of the ground. In Bellevue's Spring District, master developer Wright Runstad & Company is turning a distribution and warehouse district (the kind of place where a marauding forklift might go unnoticed for hours) into a people place — “a vibrant, transit oriented, mixed-use urban neighborhood.”

The future Spring District. Image: NBBJ

When it’s all built, the 16 city blocks will boast 5.3 million square feet of office, residential, hotel and retail space for tenants like restaurants and "diverse local shops". Office space will total approximately 3.7 million square feet — equal to two and one half Columbia Centers — and there will be about 1,200 new apartments or condos. Its location is ideal — plopped between downtown Bellevue and Microsoft Land. Initial occupancy is slated for 2015.

Whether the Spring District will have the same charm of Portland's Pearl District, where new construction is tucked in amongst existing and funky old buildings, remains to be seen. Still, it's a rare opportunity to imagine a new neighborhood from the ground up. Its successes and failures will be of its own making.

If ever there was a chance to display the promise of new, denser development along a rail line, this would be it.

In 2009, the city of Bellevue created new zoning rules that would fundamentally change the Bel-Red neighborhood, increasing density and adding the opportunity for residential and an entirely new scale of commercial buildings. In essence, Bellevue created a new urban center, one that will be the site of new growth and which will be served by the new East Link light rail line.

The planned Bel-Red corridor turned urban mecca: Bellevue itself is on the left; Bel-Red on the right. Image: City of Bellevue

Those new rules also included special allowances for something they termed a Catalyst Project, which would act as a huge anchor tenant for the neighborhood. So far, Wright Runstadt's Spring District is the only project that meets the terms necessary to be considered a Catalyst Project — terms which include less stringent affordable housing rules and that seem to have been designed specifically for that project.

Ric Ilgenfritz, head of the Department of Planning, Environment and Project Development for Sound Transit, points out that his agency has bent over backwards to make the district a success by agreeing to build a second light rail station near the district.

Greg Johnson is President of Wright Runstad & Company. Thoughtful, earnest and seemingly low key, he is clearly excited about the venture, one he says is “on par with the largest TOD projects in the country.” 

This is big time development. Billions in private capital patiently waiting maybe 15 years for the full payout. Private money betting big that they can create a new center that will compete with downtown Bellevue and other choices. Real Estate Development in capital letters.

So, how does this project measure up in terms of achieving the region’s goals — our goals?

On the surface, it’s outstanding. With 1,200 housing units and gobs of office space, the district is set to capture a significant chunk of the future of those markets while supporting regional development through light rail (though surprisingly, with roughly the same parking ratio as car-centric Bellevue Square).

Daily life in the future Spring District? Image: NBBJ

John Marasco, Chief Development Officer at Security Properties and developer of the first residential units says. “It’s great to be part of such an exciting new neighborhood … think Ballard in Bellevue and you get the picture. … It’s going to surprise a lot of people.”

Maybe not.

If the District is built out and populated by Eastside yuppies, and if the approved 10,000 parking spaces are populated by Teslas and BMW M5’s, will that be surprising?

From the standpoint of private capital, it would certainly be a success, but in the Northwest's bourgeoning conversation about fairness in economic growth, there is a danger that the Spring District will be seen as a huge missed opportunity.

In a 2013 report, the Puget Sound Regional Council predicted a “demand” for 35,000 affordable housing units around light rail stations. It would like to see an additional 18,000 units for somewhat higher incomes in the same locations. The council sees sufficient affordable housing stock as a cornerstone of public planning for light rail and urban growth.

The city of Bellevue says that it wants to be “a city that meets the housing needs of all citizens.”

Yet Art Sullivan, Program Manager of ARCH, a non-profit designed to direct money and policy toward affordable housing on the Eastside, points out that there is no requirement for affordable housing in the Spring District.

No requirements, but incentives. In exchange for allowing developers in the Bel-Red neighborhood to construct larger and taller buildings, the city requires that the developer create either some rental units affordable to people at 80 percent of median income, or some condos affordable to people at 100 percent of median income. A third choice is to pay into a fund where “someone” could build affordable housing “in other places.” The current Bel-Red zoning code requires a fee of $18 per SF when seeking to add additional residential area, but Catalyst Projects pay a reduced fee of “not less than $3.75 per SF”.

For Wright Runstad and Security Properties, the developer of the Spring District's first 320 units, the choice was easy: There will be no affordable units in the first buildings, according to Wright Runstad. Nor are there plans to build any affordable units in the Spring District's remaining housing units. Instead, they will pay a fee, though not a big one.

(Strangely, Carol Hamlin, a senior planner in the City of Bellevue's Development Services Department, says they have not received any funds thus far from Wright Runstadt and have not made any calculations regarding housing fees they might recieve in the future.)

When asked how this fits with public desire to meet demand for housing at a range of income levels, Johnson notes that others can take the money that they will pay and build nearby, within walking distance. But won’t land values rise with the train, as they have elsewhere in Seattle, making future affordable housing development pricey, and thus requiring more public dollars?  That is possible, he agreed.

Actually, it has already happened. Imagine Housing, an Eastside non-profit affordable housing developer, expressed interest in purchasing a parcel near the Spring District, but was outbid.   

Still, Johnson says there is one way Wright Runstad would consider adding affordable housing to their plans — if Bellevue creates a new incentive called the Multifamily Property Tax Exemption Program. That program would exempt developers from property taxes on their improvements for 8-12 years in exchange for affordable housing units (at levels and terms so far undetermined).

“We would do the financial calculations,” Johnson said, and if it worked out “it would definitely influence us” to build affordable housing on-site. Johnson claims it works in Seattle, though some Seattle city councilmembers have questioned the program's value.

The fact is that the city, in pursuing its version of smart growth, failed to play the affordable housing card. Despite the policies of regional planners to harness growth for all, Bellevue traded away its density for benefits which appear to have little affordable housing impact.  

The Spring District's lack of affordable housing is notable because of its size and notoriety, but it's not alone. According to a report by the Puget Sound Regional Council, the only affordable housing that has so far been built along the light rail line has been government-subsidized.

Earlier this month however an anomaly emerged: A Chinese investor called Supernova Aeronautic Technology announced that it would be building 50 affordable housing units as part of the expansion of an existing office building across from the Spring District. 

So far though, neither the Spring District, Northwest poster boy of smart growth, nor practically anyone else is willing to go along.


Despite a childhood filled with love, Geoff Spelman has endured. He refers to himself as a neonative, having lived in pugetopolis longer than anywhere else. Community development is his thing. He helped found and, for 20 years, ran a low income housing non profit, Mt Baker Housing, in the Rainier Valley. He likes old building, having served on Seattle's Landmark Preservation Board. He's also a real estate broker, though he claims it was mostly to further economic growth in Columbia City. Geoff sees playwriting as an avocation since he has had no big plays of which he is aware.

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Comments:

Posted Thu, Jul 17, 7:27 a.m. Inappropriate

The train is an alternative to the car/freeway.

It only is an alternative to driving or buses for the 1% of commuters who both live and work within a couple of blocks of a station. It is not an alternative for the overwhelming majority of people and businesses here that use vehicles to transport themselves, others, and goods during the course of any given day.

Even if you never ride light rail, you should be rooting for its success — if for no other reason than to get potential future riders out of their cars, off the road and out of your way.

If Sound Transit's rail undertakings are gauged by that criterion they are a miserable failure. There are two rail systems it built and operates running from south of Seattle into downtown, and one rail line running from north of the city into downtown. Each of those is parallel to I-5, within a couple of miles. That several-dozen miles of I-5 is the most congested stretch of highway in the state. Moreover, if the half-baked plan for WSDOT to hand over to Sound Transit a full third of the highway infrastructure in the I-90 corridor between Bellevue and Seattle actually plays out the vehicle throughput capacity of that highway will be significantly diminished. That'd put lots more cars, trucks, and buses IN “the road” and IN “your way”.

Everyone gets what's going on here, right? East of Lake Washington several large commercial property developers plan on getting considerably richer because of Sound Transit. The shareholders of Wallace Properties, Kemper Development Company, and Wright Runstad already are huge winners even if East Link never is built out. They got the spot upzones from Bellevue. Moreover, the abusive financing plan Sound Transit's unaccountable political-appointee controlled board employs relies on decades of excessive heavy sales tax confiscations as security for the mountain of long-term bonds it plans on issuing. That means the working poor and middle class will be paying heavily for decades to subsidize increased profits the large developers will realize because their properties are worth more due to nearby rail stations. Sound Transit was conceived from the get-go to function this way – as a reverse-Robin Hood, taking from the most economically-weak and transferring wealth to the rich.

Don't like that? Tough nuts. Sound Transit was structured to be immune to any attempts by people here to control its board -- and the legal policies that board promulgates -- by any political means.

crossrip

Posted Thu, Jul 17, 11:04 a.m. Inappropriate

Spot On commentary:
To get a sense of how our political/developer masters have performed, just look north to Vancouver BC transit for their solutions. Most bus lines cost in the range of $1.00 per passenger to operate, and debt financing is minimal.
Sound Transit spends money like drunken sailors, yet delivers costs per rider on their rail systems from $6 to $30 a ride. Their bus rides are little better than that.
King County Metro, run by the same pols/devs, where costs have soared in recent decades, while ridership is stalled around the 100mil/yr number. Just wait until they whack service next year when the voters get wise to this 'Regional Transit Scam' they have been running since the early '90's.
Judgement Day is Near

007

Posted Thu, Jul 17, 12:42 p.m. Inappropriate

Why should Bellevue do the "affordable housing" scam when Seattle is willing to play the sucker? There's a reason Bellevue's household income is 50% higher than Seattle's.

NotFan

Posted Thu, Jul 17, 8:08 p.m. Inappropriate

There might be if it were, but it isn't. IN 2012, Seattle: $80K, Bellevue: $91K. Neither is known for affordable housing.

sarah90

Posted Fri, Jul 18, 7:21 a.m. Inappropriate

Try using good data. It'll help your arguments. Plus, you'll be able to provide citations. Hint: that's a good thing.

Here's what US Census data say about the income of households in Seattle:

The bottom 20 percent of Seattle households subsist on a paltry $13,000 a year, while the top 5 percent earn an average of $423,000. That makes us the "fifth most affluent" city in America.

http://blogs.seattletimes.com/fyi-guy/2014/01/17/income-inequality-how-bad-is-seattle/

Admit it -- you know full well most people in Seattle aren't in households making anywhere near $80K a year.

crossrip

Posted Sat, Jul 19, 9:17 a.m. Inappropriate

I think you should hold the snark.

Here's a quote from the article you link:

"According to the most recent census data, the top fifth of Seattle households earn, on average, 18 times more than the bottom fifth. That is a wide income gap, to be sure, but it only ranks Seattle in the middle of the pack among major U.S. cities. By contrast, in Manhattan the top fifth make 40 times that of the bottom fifth.

What narrows the income gap here somewhat is that Seattle’s lowest tier earns more on average compared to most other big cities. In fact, the bottom 20 percent here make more than the same group in New York. This is most likely the result of our state minimum wage, the nation’s highest at $9.32 (the federal minimum wage is currently $7.25).

kieth

Posted Sat, Jul 19, 10:30 a.m. Inappropriate

What's your point? So what if the lowest quintile here has $13K annual income, whereas it's some amount less than that in NYC? That's immaterial. It certainly is no justification for the abusive financing plan the unaccountable political appointees comprising Sound Transit's board designed.

What does matter is that the purported "$80K" annual income for Seattle households is an average, and the massive disparities in income here render that average a useless, misleading figure.

crossrip

Posted Sat, Jul 19, 6:09 p.m. Inappropriate

The point is that your link does not support what appears to be your argument, namely thatincome inequality somehow negates the rationale for development around transit stops. Higher incomes in Seattle and Bellevue are a good thing not something to gnash your teeth about.,,what's the alternative? You want a little bit of Buffalo around here? Transit, which is highly subsidized, is a benefit for low income people.

kieth

Posted Sat, Jul 19, 6:58 p.m. Inappropriate

Oh I get it -- you don't understand what I was posting about. Mmm-kay.

The fact that the top 5 percent of households here earn an average of $423,000 is neither bad nor good, it simply is. What IS bad is how all the government heads around here incessantly target the least wealthy with the taxes they impose. Because of the abusive, excessive taxing in the name of buses and trains here transit in fact does far more harm than good for the great majority of the working poor, the elderly on fixed incomes, the underemployed, and middle class families generally.

The biggest beneficiaries of transit are businesses, and they aren't targeted for transit taxes. That abject disparity is what blows about how transit around here is financed.

You get this, right? Most "low income people" don't benefit from transit because they don't have jobs in fixed locations they can use transit to reach.

crossrip

Posted Sun, Jul 20, 8:27 a.m. Inappropriate

"You get this, right? Most "low income people" don't benefit from transit because they don't have jobs in fixed locations they can use transit to reach."

Really? Where is your proof? Are you saying these low-income people have jobs at locations that are not fixed?

Besides the condescending tone of your post, you're wrong,pal.

jeffro

Posted Sun, Jul 20, 9:23 a.m. Inappropriate

My proof is that Census data show 20% of households here have less than $13K in annual income, and that is a figure below what a single fixed-location low wage job would pay -- by a lot. A $12 an hour job is $24K per year, for example.

Are you saying these low-income people have jobs at locations that are not fixed?

If you're in the bottom-quarter of household income there's probably nobody in that household with a real full-time job. Only a small percentage of the bottom-quarter of households on the "annual income scale" rely for that income on somebody who can commute from home to some fixed-location job on a bus or a train.

Transit's benefits are disproportionately enjoyed by corporations, governments, and those who make FAR more than the unemployed, the disabled, and the working poor families around here. That holds true in spades for the users of Sound Transit's rail systems. If it weren't for tourists using SeaTac and suburbanites travelling to sporting events near the ID the ridership numbers would be considerably more pathetic.

crossrip

Posted Sat, Jul 19, 1:39 p.m. Inappropriate

sarah90, you really arern't very bright, are you? Typical "progressive" here -- stupid and doesn't know it.

BELLEVUE

Est. household income 2012: $91,449

www.city-data.com/city/Bellevue-Washington.html

SEATTLE

Est. household income 2012: $64,473

http://www.city-data.com/city/Seattle-Washington.html

That's 42% higher in Bellevue. Other data show a wider gap.

NotFan

Posted Sat, Jul 19, 5:17 p.m. Inappropriate

Please explain what possible relevance there is in comparing mean household incomes, given that 52% of Seattle residents are renters, but only 39% of Bellevue residents. Renters compared to home owners are more likely to be poorer, younger, and single. Per capita income provides more of an "apples to apples" comparison:

Seattle: $42,280
Bellevue: $51,309

Difference: 21%

Posted Mon, Jul 21, 5:50 p.m. Inappropriate

Why the insults, NotFan? And how bright are you if you cannot spell "aren't"?

Cheonasty

Posted Mon, Jul 21, 5:50 p.m. Inappropriate

Why the insults, NotFan? And how bright are you if you cannot spell "aren't"?

Cheonasty

Posted Tue, Jul 22, 7:31 a.m. Inappropriate

Cheonasty, how bright are you when you post the same comment twice?

Posted Tue, Jul 22, 1:12 p.m. Inappropriate

I think being able to take the train from home to work and back is a luxury, for many reasons (Save on car/insurance, relaxing ride, cheaper living not having to pay for a parking space in your building). Luxuries should be reserved for people who produce enough to afford them, so I'm glad nobody is building low income housing in such soon-to-be affluent areas. No one is entitled to a better quality of life they didn't earn through their own productivity.

However, using taxpayer dollars to create this train is evil because of the above. If wealthy people want to have a transit system to get them to and from places of interest, they should pay for it themselves. Our transit system, like everything else, should be done purely through private for-profit ventures.

aminshar

Posted Tue, Jul 22, 2:10 p.m. Inappropriate

"No one is entitled to a better quality of life they didn't earn through their own productivity."

That explains why all the folks that inherit their wealth all still have to live in the ghetto.

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