The study was created by a 12-person panel of local business owners, residents and artists, as well as members of the BEDP, Parks Department, City Council and other related groups. It outlines enhancements the city says are needed to help the district, with more than 90 small businesses, reach its economic potential.

The city’s goal is to “create a strong, unique identity for SW 153rd Street as a destination corridor in downtown Burien” according to the study.

Here’s more from the study, which can be downloaded as a PDF file here:

SW 153rd … is inconspicuous relative to other areas of downtown, such as SW 152nd Street and 4th Avenue SW, and the City desires to look at ways to support and enhance its economic vitality. Opportunities to give the corridor a stronger identity and clearer wayfinding are important to its economic vitality within downtown. With over 90 businesses located between 1st Avenue S to the east and Ambaum Boulevard SW to the west, the corridor is ready to be discovered as its own unique destination in downtown.

As a preliminary step, the goal of this study was to identify whether there is support from business and property owners for enhancements and to discuss what direction those enhancements should take. This study does not identify actual solutions but is meant to provide the context for enhancements. The next step will be to convene a stakeholder group, along with designers, to develop concepts and a budget.

The initial stakeholder group meetings found a consensus around the need to improve the corridor. As a result of this process, the following design goals were identified for the corridor:

• Create a unified commercial corridor that supports businesses.
• Strengthen the business environment by supporting the full range of businesses.
• Provide clear wayfinding to the corridor at key locations.
• Provide pedestrian amenities to encourage a more friendly business environment.
• Provide parking management for both the corridor and downtown.
• Create a strong, unique identity for the corridor that the businesses can associate with.

Part of the challenge the panel found was that the SW 153rd Street corridor is a very wide, auto-oriented commercial/retail street. In comparison, SW 152nd Street is a narrow, pedestrian-oriented commercial/retail street. The buildings along SW 153rd Street are generally about 180’ apart. Buildings on SW 152nd Street in Olde Burien are 60’ apart – one-thirds closer to each other.

“The SW 153rd street realm is about three times wider than most commercial main streets,” the report reads. “This results in storefronts that are very far from the roadway. This diminishes the presentation and legibility of individual storefronts, with their storefront signs being less clear.”

As anyone who’s driven down SW 153rd can attest, it does seem very wide, which presents a challenge in how to make it more user-friendly without having to re-build it at a huge cost? We here at The B-Town Blog wonder:

“What the heck were our city planners thinking when they designed this street? That we’d all be driving super-wide Cadillacs with really big fins?”

The report concludes with photos of various street-oriented works of art, and is meant as a starting point for further discussion. Here’s some of them:

We recommend you download the PDF here, take time to read it, then come back here and chime in with a Comment – we’re curious to hear your ideas on how you’d improve SW 153rd’s appeal?

by Ralph Nichols

Urban Partners will inform Burien by early next year about its plans for a “marketable” new development at the city’s Town Square.

Construction by Urban Partners of a second multi-use Town Square facility was to begin by mid-July – two years after the private developer’s condominium/retail complex was certified for occupancy.

Since then, however, the current recession has frozen the condo housing market – and due to circumstances beyond its control, Urban Partners no longer owns its first Town Square building.

ST Residential, which now owns the six-story building, has yet to sell a condo or lease ground-level retail space.

Urban Partners asked the city in June for an extension of time to break ground on its next Town Square project, Burien Economic Development Manager Dick Loman recently told The B-Town Blog.

After reviewing that request, the city asked Urban Partners “to provide information on what they think will be marketable,” Loman said.

“Urban Partners has agreed to supply this information to the city 45 days after the first sale closes at the Town Square condos, but no later than Jan. 21. Urban Partners will key off ST Residential because that [sale] will be a local market indicator.”

Still owned by Urban Partners for anticipated development are the vacant Town Square parcels north of the condo/retail complex and the King County Library/Burien City Hall building, and a narrow property east of the post office between S. 150th and S. 151st streets.

ST Residential is still penciling out prices for the 118 unsold Town Square condos “that are fair to us and give value to the owners,” First Vice President David Ploger told Burien City Council members Aug. 15.

Those prices are expected to be “more than 35 percent below the original prices” when the seven-story complex opened over two years ago. The new prices may be approximately $120,000 to $420,000, compared to the original $200,000 to almost $700,000.

While ST Residential “looks forward” to its public launch of condo sales, “I can’t guarantee it will happen yet this year,” Ploger told the city council at that time. No mention was made of the building’s 20,000 square feet of vacant retail space.

Just six condos were sold by Urban Partners before sales were placed on hold when the Federal Deposit Insurance Corporation (FDIC) closed Corus Bank of Chicago in September 2009.

Corus Bank had financed construction of the building with a $38.5 million loan in 2007 to Urban Partners, the city’s partner as developer of the private components of the Town Square project.

But the nation’s housing market began to collapse a year later, eight months before the condo/retail complex opened along with the library/city hall building and Town Square Park.

After the FDIC seized the bank’s assets, including Urban Partners’ loan, ST Residential became holder of its residential construction loan portfolio.

ST Residential is comprised of the FDIC, which holds a 60 percent share of that portfolio, and Starwood Capital Group and four other private investors.

Urban Partners eventually transferred ownership of the condo/retail complex to ST Residential – avoiding a trustee’s sale of this property, which was in foreclosure. The FDIC earlier had rejected an offer by Urban Partners to buy back its construction loan.

“We fully expect that once [ST Residential] gets this thing off the ground, they’re going to sell many more units than just one,” Loman continued. “There is a lot of interest in them” and the first sale should result in a “domino effect.”

In the meantime, “the city is limited in what it can do” to assist Urban Partners in moving forward, he said. Burien’s role is “largely speculative at this point, but we’re anxious to do whatever we can.”

And if Urban Partners is still unable to present a phase two development plan by January, the city will probably re-negotiate with them.

Urban Partners “remains committed to our investment in Town Square with a ground up development” in the future, principal Paul Keller told The B-Town Blog earlier this year.

“As the economy continues to heal, we are optimistic that at some point in time we will be able to move forward” with the second phase of private development there.

by Ralph Nichols

Two years ago this month, everything was coming up roses at Burien’s new Town Square.

Community celebrations heralded grand openings of the Burien City Hall/King County Library building and a condominium/retail complex, and the downtown park between these two facilities began attracting people and events.

When the condo/retail complex – built by Urban Partners, the city’s private developer for this visionary project – was certified for occupancy on July 21, 2009, the clock started ticking. Urban Partners had two years to begin construction of a second mixed-use facility in Town Square.

But through circumstances beyond its control, which stemmed from the onset of the recession in 2008, Urban Partners no longer owns its first Town Square building.

And with less than two months remaining before the construction-startup deadline, Urban Partners still has no plans for a second development.

Dick Loman, Burien’s economic development manager, told The B-Town Blog on June 1 that Urban Partners has asked the city for an extension of time to begin construction of the next Town Square building.

“We [city staff] have it under advisement,” Loman said. “We want some assurance that they will continue their investment in Town Square … Staff is not ready to present it to the City Council at this point, but we hope to very shortly have an extension request for them to consider.”

Urban Partners “remains committed to our investment in Town Square with a ground up development” in the future, principal Paul Keller said in a phone interview.

They have asked for a three-year deadline extension and meet regularly with city officials, Keller noted. “As the economy continues to heal, we are optimistic that at some point in time we will be able to move forward” with the second private development.

While city hall and the library are constantly busy, and the park draws public activities like Burien Farmers Market, only six condos have been sold.

ST Residential, the investment group that now owns the condo/retail complex, has yet to make known its plans for the remaining residential units and commercial space. However, an announcement is expected in the next few weeks.

Corus Bank, which held Urban Partners’ Town Square construction loan, was closed by the FDIC in September 2009. ST Residential, a consortium of private investors and the FDIC, gained control the property a few months later.

Meanwhile, Urban Partners has placed on the market the vacant Town Square parcel north of the condo/retail complex – one of three undeveloped parcels it still owns – currently advertised on Craigslist by Leibsohn & Company Commercial Real Estate Services:

Its other two parcels are the old city hall building north of the new city hall and library, and a narrow property east of the post office between S. 150th and S. 151st streets.

Loman also reconfirmed that a proposal to build a 10-screen multiplex cinema – once considered as an alternative to a second Town Square condo/retail complex – “is no longer on the table.”

Here’s more from Liebsohn’s Executive Summary on the property (download the PDF here), which lists the price at $1,875,000.00:

The two parcels available make up the undeveloped portion of the Burien Town Square. The larger parcel is 1.72 Acre lot is zoned downtown commercial (DC). Per an executed development agreement with the City of Burien this parcel can be developed as a 7 story, 286,600 Square Foot mixed-use building consisting of approximately 142 residential units, 20,000 Square Feet of retail, and 258 parking stalls. The second parcel is a 0.32 Acre lot which is also zoned downtown commercial (DC). Per an executed development agreement with the City of Burien this parcel can be developed as a 3 story, 20,000 Square Foot residential town home project consisting 11 residential units, and 22 under unit parking stalls.

The City of Burien’s agressive plan for growth and modernization centers on it’s downtown, where Burien Town Square is located. The civic plaza has ushered in a new King County Library and City Hall, along with retail and restaurant space, a one-acre park and residential condos. The city also plans a new, state-of-the-art transit center and upscale hotel nearby. All told, the more than $200 million in public and private funds have been spent on road and infrastruc- ture improvements.

by Ralph Nichols

Tukwila-based O’Keefe Companies, whose principal and managing director Tom T. O’Keefe is the founder and past chairman of Tully’s Coffee, has acquired Normandy Park Towne Center.

O’Keefe told The B-Town Blog he will rejuvenate the 53,000-square-foot, single-story retail space, and is planning a grand re-opening for the community – and the five businesses now there – sometime in May.

Towne Center, at 1st Ave. S. and S. 199th St., opened in 2007 but soon was mired in financial difficulties brought on by the nationwide recession.

Things only got worse when a major improvement project to 1st Ave. through Normandy Park was delayed by problems with a contractor, which proved costly to businesses in the new development and discouraged other retailers from locating there.

Columbia Bank of Tacoma, the construction lender, took the property back in December after the original developer defaulted on its loan. O’Keefe Companies closed its purchase on March 31.

“I will put on a very creative leasing campaign to fill with tenants space that has never been occupied,” O’Keefe said. “Currently five businesses are operating there. The bad news is that they’ve been operating by themselves for a number of years.

“I have met individually with every business owner and they are excited about my plans to fill the space that will rejuvenate their businesses as they had planned for” when they moved in.

Normandy Park City Manager Doug Schulze said in a statement, “This acquisition is very significant and a positive step toward the creation of a vibrant and successful commercial area.

“O’Keefe Companies has the experience, motivation and financial ability to bring new businesses to Normandy Park Towne Center.”

O’Keefe Companies develops, acquires and manages office buildings, industrial buildings, retail centers and multi-family projects in the greater Puget Sound area, including RiverPoint Corporate Center in Tukwila.

The group formed within O’Keefe Companies that took title to Normandy Park Towne Center is Medina Fund Four LLC.

“I’m the manager of the LLC,” he said. “O’Keefe development will be the property manager. We manage everything we own.”

He became interested in Normandy Park Towne Center, which includes four new buildings, when it became available last year. “Unfortunately with the market timing, the original developer lost the title given the economy. I was able to buy it at a very competitive price from the bank.

“I’m a big believer in the demographics in the neighborhoods of Normandy Park,” O’Keefe continued. “And this is what I do for a living. I develop new commercial projects or buy what’s referred to as value add, which is competitively priced.”

O’Keefe Development Corporation was established in 1986 and since then has developed or acquired over 3,800,000 square feet of projects valued at approximately $400 million.

Prior to that, O’Keefe was a commercial real estate broker for nine years with Coldwell Banker Commercial Real Estate Services in Seattle.

He founded Tulley’s Coffee in 1992, but his only affiliation with Tully’s today is as its largest shareholder.

O’Keefe and his wife, Cathy, have also been actively involved in community organizations for over 30 years. Their charitable efforts focus largely on the health, education and welfare of the children – including cystic fibrosis and juvenile diabetes – in the Puget Sound region.

This involvement is one of the reasons why he met with Schulze before closing the deal. “My goal is to immediately immerse this project in community programs,” including art shows and fundraisers in the short term.

Beyond the commercial potential of his Towne Center, O’Keefe is eying the possibility of leasing space for a new Normandy Park City Hall, police station, parks and recreation center and, “most importantly, for a new city library.”

“Maybe there are opportunities for some of those uses at this location,” he added. “We’re going to have various discussions about those opportunities. I acquired this as a retail center but there is an opportunity for municipal services as this location.”

by Ralph Nichols

Urban Partners no longer owns the largely unoccupied six-story condominium/retail complex it built as the first private development in Burien’s Town Square.

And the clock continues ticking toward the deadline for Urban Partners to begin construction of its next Town Square project.

It appears, however, that a 10-screen multiplex cinema will not be this project – and that one may never be built at Town Square.

City Manager Mike Martin told The B-Town Blog this week that Paul Keller, managing partner of Urban Partners, implied the proposed cinema complex may be stalled.

Keller reportedly said this while he was in Burien on Nov. 12.

According to Martin, Keller indicated that development costs are significantly higher than earlier estimated, while additional funding for such a project is harder to obtain at this time.

So what happens at Town Square next? It appears that no one knows – or, if they do, they’re not talking.

Neither Keller nor Frank Rimkus, president and CEO of Los Angeles-based Galaxy Theaters, have returned calls from The B-Town Blog.

Last November, Rimkus presented a proposal to Burien council members to build with Urban Partners a Town Square multiplex cinema.

Development Agreement
Urban Partners’ original plan, agreed to by the city in 2005, was for construction of a second condo/retail complex as phase two of the private development component of Town Square.

The development agreement between Burien and Urban Partners also required the city’s private partner to have its second project underway no later than two years after completion of the first.

A certificate of occupancy for the condo/retail complex was issued in July 2009.

Urban Partners owns the vacant parcels east of that property and the library/city hall, immediately west of SW 150th St. It has submitted no plans for the development of either parcel to city staff.

Under the development agreement, Burien could buy back those parcels for 90 percent of what Urban Partners paid for them if a second project has not been started by the deadline.

But, said Martin, “at this point the city has no intention of triggering [the buy-back] provision … we know with a great deal of certainty they will not be building condos there in the next couple of years.

“The reality is that nobody is building big projects right now. They just aren’t. It would be foolish to start a major project right now.”

Noting that Urban Partners “just got caught up in a bad economy,” he added the city is “willing to work with them on alternatives.

“We want them to be ready, not too soon and not too late,” when the economy begins to recover. “What is smart now is to be planning what comes next.”

A negotiated alternative might include a realistic time extension for Urban Partners to begin construction of its phase two development, with the city receiving certain benefits in return.

The proposal by Urban Partners/Galaxy Theaters for a multiplex cinema, as an alternative to another condo/retail complex, suggested building it at the southwest corner of S 150th St. and 4th Ave. SW.

Rimkus estimated it would bring 400,000 movie-goers – most of them from the area between West Seattle and Federal Way west of Interstate 5 – to downtown Burien annually.

Some retail space was to be included in the cinema complex.

Urban Partners as Manager?
On Oct. 29, Urban Partners transferred title of its Town Square building to ST Residential rather than going through a foreclosure sale or filing bankruptcy in an attempt to retain ownership of this property.

ST Residential announced at the time that Urban Partners would be manager of the building because of its history with Town Square and the city.

But even this may not be a sure thing.

The Federal Deposit Insurance Corporation (FDIC) holds a 60 percent in ST Residential. Because public funds are involved in this investment group, a request for proposals for a permanent manager of the condo/retail complex may be a legal requirement.

Although Urban Partners likely would submit a proposal – with an inside track given its history with the project – there is no guarantee the development group would win the contract.

Urban Partners financed construction of the private Town Square development with a $38.5 million construction loan from Corus Bank of Chicago.

But the bank, a major construction lender, was closed and its assets seized by the FDIC in September 2009, just three months after the building opened.

ST Residential – an investment group formed by the FDIC, Starwood Capital Group and four other private investors – acquired Urban Partners’ Town Square project loan.

With negotiations between Urban Partners and ST Residential – initiated shortly after the failure of Corus Bank – moving slowly, a legal notice of foreclosure was filed on July 26.

If Urban Partners did not make a past-due payment of $3.5 million by Sept. 1, according to that notice, the Town Square complex would go into foreclosure.

Six condos sold last year were not impacted.

Peter Marino, a spokesman for ST Residential, said this week the investment group is “in deep analysis mode right now since we got the property a few weeks ago. We are getting our arms around it and we will be making decisions on a variety of issues in the weeks and months ahead.”

Those decisions may include how much to reduce condo prices, if at all, and what new retail leasing rates should be so sales can resume and the building can start filling up.

No new sales or leasing activity is expected to begin until mid-spring at the earliest.

by Ralph Nichols

A dark financial cloud that cast a long shadow over Burien’s plans for its future disappeared when City Council members gave unanimous approval Monday night (July 19) to a negotiated insurance settlement.

The lawmakers accepted an agreement with the Washington Cities Insurance Authority (WCIA) that favorably resolves for the city issues of outstanding insurance coverage in the long-running Westmark v. Burien case.

“No longer will we have millions of dollars of liability staring us in the face,” City Manager Mike Martin told the B-Town Blog.

Westmark Development has had plans to build Emerald Pointe on the Sound – a controversial housing development with up to 200 market-rate condominiums at 13401 12th Ave. S.W. – for 20 years.

But the project, opposed by residents of the Seahurst area who have voiced environmental concerns, has been on hold since the city incorporated in 1993 and took over permitting from King County.

The proposed site of Westmark's "Emerald Pointe on the Sound" is at this location at 13401 12th Ave SW, which is essentially a vacant, wooded ravine.

Westmark eventually filed suit against Burien for intentionally interfering with its “business expectations.” In 2007, the state Court of Appeals upheld a $10.7 million judgment against the city, plus interest and other expenses.

While the WCIA paid most of the Westmark award, “Burien paid an additional $510,341.77 to satisfy the Westmark I judgment,” according to the claims settlement agreement.

The city later paid additional “substantial attorneys fees and defense costs” in two subsequent suits related to this case.

City Attorney Craig Knutson said under the agreement, which holds Burien harmless, the WCIA will:

• Reimburse the city for the $510,341.77.
• Reimburse the city for approximately $60,000 it has already paid in the current round of litigation with Westmark.
• Accept responsibility for coverage of the city’s ongoing liability for Westmark’s attorney fees and other defense costs in this suit.

“The agreement with the WCIA resolves insurance coverage issues so the city will not incur any financial liability on what has been incurred to date or will be incurred in the future,” Knutson noted.

“In essence,” Martin said, “the city has come out unscathed after all these years. This is significant because [the liability] has had such immense financial consequences that it clouded our ability to plan for the future.”

When considering city programs and projects, “I always had to ask myself, ‘what happens if we are held liable for part or all of this?’” he added. “This agreement takes away that cloud. This is absolutely the tail of the dog.”

The reimbursements will go “back into the general fund where it come from.”

Knutson said the settlement is the result “of ongoing negotiations and analysis of insurance coverage issues complicated by the fact that the coverage was over so many years.”

As for Westmark’s proposed condo project, “it is alive in the sense that it’s still buildable. But no permits have been issued yet,” Martin said.

While project plans have been revised, “it’s still a major multi-family complex but with major modifications … it’s something that can still be built.”

by Ralph Nichols

Burien City Council members were told in a cautiously optimistic “bottom-line” update Monday night (May 24) that residential units in the mostly vacant, six-story Town Square condominium/retail complex could be selling later this year.

“This city and community will see the project sold out sometime in the future,” said Paul Keller (pictured, left), managing partner of Urban Partners, Burien’s private developer for the Town Square project. “I don’t think it will be years. I think it will be months.”

Keller also announced that, in June, Urban Partners and Galaxy Theaters will present the council “with a proposal to move forward with a theater project.” The idea of building a cinema in Town Square was initially discussed with lawmakers last November (read our previous coverage here).

This development, if built, would include a 10-screen multiplex cinema, with an additional stage for community theater and dance, on the Town Square parcel at SW 150th St. and 4th Ave. SW where the old city hall building is located.

“Working in this economy has been very, very challenging,” Keller said. “And then when we lose the construction lender – that was frustrating.” Nevertheless, “Urban is absolutely committed to this project.”

Burien's old city hall building at SW 150th and 4th SW could be the home of a new Galaxy Cinema complex.

Corus Bank of Chicago, through which Urban Partners obtained the construction loan to build the phase one complex in Town Square, was closed and its assets seized by the Federal Deposit Insurance Corporation on Sept. 11.

Now the Urban Partners’ construction loan is held by a joint venture of the FDIC and Starwood Capital Group – S.T. Residential.

“The FDIC entity does not lend itself to any quick resolution,” Keller noted. “I have spent countless, countless hours in meetings in New York, in Chicago, in San Francisco, in Seattle trying to move that process forward.”

“We have people waiting to close escrow and move into the building, but they’re stymied.” While Urban Partners waits on the FDIC process, the investment group continues to actively manage the condo/retail building.

“We have made four separate proposals to the FDIC to maintain our involvement with phase one,” Keller continued. But “since the federal takeover of Corus, we are not in control of the timing or the outcome of events.”

He said as recently as Monday afternoon, he was involved in an exchange of ideas that could help bring the parties to an agreement in the next 30 to 45 days “on our continuing involvement in phase one.”

But, Keller cautioned, although he remains hopeful, there is no certainty at this time that a resolution will emerge from the current discussions. Even so, “I don’t anticipate that an impasse will develop.”

A factor that could help Urban Partners is that their construction loan is the only one of the 135 large commercial assets – ranging in value from more than $50 million to around $225 million – in the portfolio held by S.T. Residential for a property located in Washington state.

The $52 million, phase one condo/retail complex in Town Square, with 142 residential units and 20,000 square feet of ground floor commercial space, “was completed on time and on budget,” Keller stated.

This city and community will see the project sold out sometime in the future,

But phase two – construction of more condos in a separate complex just north of the existing building, which opened last June – “is on hold given the collapse of the housing market.”

Development of a cinema in the meantime would “increase business downtown and benefit existing businesses,” he predicted.

“Urban Partners is so proud to be part of Town Square,” Keller told the council. “This development and our investments remain a very high priority … despite the severe economy.”

PREVIOUS COVERAGE:

• ‘We Can Be Proud Of What We Did’ – Town Square Developer Dan Rosenfeld
• Is Town Square’s Urban Partners Becoming A ‘Silent Partner’ To Burien?
• What Is Urban Partners Planning To Do With Burien Town Square?
• Here’s Why Burien Town Square Sits Vacant Less Than A Year After Opening
• 10-Screen Multiplex Theater May Be Built At Old City Hall Location
• Cinema Reps Make Their Pitch To Burien City Council
• Will Condo Prices Be Lowered Now That Burien Town Square’s Lender’s Assets Have Been Sold?
• Are Reports Of The Demise Of Burien’s Town Square True? Take Our Poll
• Over 1,000 Witness Burien Town Square Grand Opening

by Ralph Nichols

As work on the six-story condominium/retail complex in Town Square neared completion, principals of Urban Partners held their breath, month by month, until troubled Corus Bank of Chicago paid each draw on the construction loan.

“The good news is we made it to completion. They funded every construction draw,” Dan Rosenfeld, a founder of Urban Partners – Burien’s private developer for Town Square, told The B-Town Blog last week. “Then they went bust.”

Corus Bank was closed and its assets seized by the Federal Deposit Insurance Corporation on Sept. 11. Now the Urban Partners construction loan is held by a joint venture of Starwood Capital Group and the FDIC.

“If we do nothing else in our lives, we can be proud of what we did with this project in this community,” Rosenfeld continued. “In our hearts, we know we have done a great thing in Burien. We took empty parking lots and turned them into a world-class project.”

But the condo/retail complex – which opened last June at the same time as the new Burien City Hall/King County Library – remains only partially occupied with six residential units sold, due to complex financial entanglements completely removed from the control of Urban Partners.

“Every sale or lease of space requires lender approval,” Rosenfeld said. But since the failure of Corus Bank, “there is no one to approve leases or sales. There is no one to even approve prices.”

Starwood currently seems”unwilling or unable” to do that, “but this won’t last forever,” he continued. The financial issues resulting from the bank failure will be resolved, and he expects that most of the condos will be sold and the retail space leased or sold by the end of this year.

Trading Places
Although no longer a principal with Urban Partners, a Los Angeles-based development company, Rosenfeld remains involved with Town Square as “an active partner and investor” through Urban Ventures – a related company that actually owns this property with other investors.

[Note: Because Urban Partners submitted the original private proposal for Town Square, the name Urban Partners is used throughout this story.]

Rosenfeld became concerned in 2007 “that the real estate market was increasingly fragile, and we needed to take a more conservative approach. It was time to get out. But I didn’t want to let this one go.”

Keeping his Burien investments – including Town Square – in his portfolio, he sold his shares in Urban Partners and many other investments to his partners in the development company, Paul Keller and Matt Burton.

“I stayed loyal to Burien,” he added. “It’s a great community.”

In the meantime, Urban Partners, with Rosenfeld no longer a principal, has continued with its other investments and development projects, including the Terry Avenue Apartments in downtown Seattle.

Rosenfeld formally left Urban Partners last year to join the staff of Los Angeles County Supervisor Mark Ridley-Thomas, a friend of 20 years.

Dan Rosenfeld now works for Los Angeles County Supervisor Mark Ridley-Thomas.

As a senior deputy responsible for economic development, land use, sustainability and transportation issues, he now oversees a $1.7 billion light rail project and the $700 million replacement of hospitals that don’t meet seismic codes, just in Ridley-Thomas’ district.

“Transit-oriented and community development remain my great interest,” he said. “The time to develop new real estate will someday return.”

While his personal interest and connections in the Northwest helped him sell the Burien City Council on Urban Partners at the inception of the Town Square project, Rosenfeld admits the L.A. investors face an uncertain future here.

Urban Partners future role?
“Starwood [Financial Group] has very strong rights” to the condo/retail complex, he conceded. “They bought the [construction] loan –with the FDIC after it closed Corus Bank. They control the note.”

The FDIC sold a 40 percent interest in the bank’s construction loan portfolio to the Starwood group for about 50 cents on the dollar – while Urban Partners was attempting to buy its Town Square construction loan directly from the federal agency.

Now Urban Partners is negotiating with Starwood and the FDIC for a restructuring of its construction loan that reflects current financial conditions. “The market has changed since the project started,” Rosenfeld said. “Nothing is easy today.”

He hopes the negotiations will result in either a partnership or similar relationship between Urban Partners and Starwood for ownership and management of the building, or its outright purchase by Urban Partners. The development company’s other investment partners are also involved in the negotiations.

While Starwood and the FDIC own the note on the construction loan for the condo/retail complex, “Urban Partners knows Burien and the project better than anyone else,” Rosenfeld said. “It would be hard for Starwood to focus adequately on this one project in the Corus portfolio,” especially since many of their projects are in the Sunbelt.

With these factors in mind, he speculated that Starwood might seek a partnership or joint management role with Urban Partners for the Town Square building. “Urban Partners has credibility [in Burien]. No one can do a better job for Starwood, or for the community.

“Let’s each bring our strengths to this and get the project sold out. Sell the condos with pending buyers and then sell the rest.” Six condos closed last year, with serious interest from buyers in 34 others despite the fact the sales can’t be closed at this time.

Land for Sale
For now, Urban Partners still owns the three remaining parcels of land on the northern half of the Town Square site. But the group recently listed two of the undeveloped parcels for sale with a commercial broker “to test market interest,” according to Rosenfeld.

The largest parcel, located south of SW 150th St. and east of 6th Ave. SW, is listed for $1.8 million. Immediately beyond the condo/retail complex, this land – originally designated for phase two development of the project – was occupied by the Burien/Interim Arts Space last year.

A vacant half block south of SW 150th St. and west of 6th Ave. SW is listed for $330,000.

At this time, Urban Partners shows no indication that it would let go of the third large undeveloped parcel it owns in Town Square, located south of SW 150th St. and west of 4th Ave. SW, still occupied by the old city hall building.

A proposal for construction of a 10-screen cinema on that site is under study. Yet nothing is carved in stone for Urban Partners, either the parcels it might sell to the right buyer, or the future use of each parcel.

All Options Considered
“We’re looking at all choices,” Rosenfeld said. In the future, Urban Partners could end up developing mixed-income housing or a medical office building or a hotel on the remaining parcels. “All are possibilities. It’s a matter of time and economic recovery.”

Any new buyer of vacant land in Town Square will be obligated, legally, to conform to the original development agreement that Urban Partners signed with the city, according to Dick Loman, Burien’s economic development manager.

City Manager Mike Martin noted last month that Burien “has no money invested” in the private development components of the Town Square, “so the city will not lose any money” if Urban Partners is unable to continue and new investors don’t move in to complete the project.

Rosenfeld remains optimistic. “I don’t know what will happen in the future, but, with our long history here – my family has been active in business in Burien for 47 years – we have made commitments. We set the bar high. Eventually phases two and three will be built.”

Although he provided input to the original Burien City Council when a town square was first discussed, as far back as 1995, “I had no idea I would bid on the site someday, let alone build on it. We are very proud of what we have done together.”

Town Square today – the King County Library/Burien City Hall building, the condo/retail complex and the park between them – is “recognized around the country as a textbook example of first-tier suburban revitalization,” he said.

“It took a lot of determination, and it happened because of the dynamic intervention of the city ten years ago. When we started, parking spaces along [SW] 152nd [St.] were empty after five o’clock.

“Now, with new restaurants and businesses on the street, it’s busy well into the evening,” Rosenfeld added. “We have changed Burien significantly – for the good. Nothing worthwhile is easy, indeed.”

PREVIOUS COVERAGE:

• Is Town Square’s Urban Partners Becoming A “Silent Partner” To Burien?
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by Ralph Nichols

A $20.5 million parking garage with 500 stalls, planned for the park-and-ride lot in downtown Burien, has moved a big step closer toward the start of construction.

The King County Council adopted unanimously on Feb. 16 an ordinance approving both a ground lease of the county-owned parking lot to Alliance Wasatch I, LLC, which will build the garage on that site, and a lease back to the county of the parking facility upon its completion.

“I’m excited to see signs of progress on this project because connecting people to transit is a critical part of maximizing our transit investments,” said King County Councilwoman Jan Drago, who represents Burien.

“This is one piece of a [Transit Oriented Development] package that the King County Council will be addressing to help bring smart, green development to the heart of Burien and [Council] District 8.”

The existing park-and-ride lot with 300-plus stalls on the northeast corner of SW 150th St. and 4th Ave. SW is adjacent to the new Burien Transit Center – the first part of a three-phase Transit Oriented Development (TOD) project in Burien. The transit center opened last June.

Temporary transit parking during construction of the garage may be located at the old BBC Dodge site at 1st Ave. S. and SW 148th St. An arrangement for this currently is being negotiated.

King County Executive Dow Constantine was authorized by the County Council to execute final details of both the ground and project leases, and to approve certain other provisions of the lease–leaseback transaction.

Burien Economic Development Manager Dick Loman noted that the ground lease, which is expected to be dated April 1, “is subject to receipt of legal documents from Sound Transit, the Federal Transportation Agency, and the U.S. Department of Energy,” which are the county’s funding partners for the project.

After the County Council gives final approval to the project and the lease becomes effective, the developer will have 90 days to finalize construction financing and building permits.

Loman added that construction could begin by Labor Day, with project completion and the opening of the garage expected by July 2011.

He said the county “plans to exercise its option to purchase the parking facility upon completion.”

The final phase of Burien’s TOD – construction of approximately 100 affordable multi-family units around the outside of the five-story parking garage, with a sixth level underground – is expected to proceed after construction of the garage is completed as financing is available.

“Once the apartments are built, you won’t even know a parking garage is there,” Loman said. A lot of this housing is expected to be made available to new teachers in the Highline School District.

Retail and office space will be located on the ground level of the garage/apartment development.

by Ralph Nichols

Although vacant commercial properties in downtown Burien are beginning to fill up with new and returning businesses, as we reported last week, a couple of big pieces still are missing.

None of the street-level retail space in the Town Square condominium complex at SW 152nd St. and 6th Ave. S. is occupied five months after the development opened, with no indication that any businesses are likely to move in anytime soon.

And a twice-anticipated hotel, which just a few years ago was expected to have welcomed its first guests long before now, still is just a dream.

So, despite all the encouraging news, what’s going on with these stalled commercial ventures?

According to Dick Loman, the city’s economic development manager, a combination of factors beyond the control of the city, Town Square private developer Urban Partners and other investors are at play.

But Loman is optimistic that these pieces will fall into place “hopefully sooner rather than later.”

With a number of hotels clustered in SeaTac and more in Tukwila, Burien, which is less than four miles from the airport terminal, seems like an ideal place for the next hotel development in this area, he said.

But while being first in a new location is seen as a marketing advantage for lots of businesses, the hotel industry – in which several properties often are located close together – considers “a pioneering effort” as having “a higher degree of risk,” Loman explained.

So Burien continues to wait for a hotel to come here. Still, there have been promising signs of interest.

In December 2005, Loman recalled, a Tacoma group signed a development agreement with Burien to build a hotel on the vacant city property at SW 150th St. and 2nd Ave. SW. Less than two years later, however, they ran into serious problems with a hotel already under construction in Lakewood and had to withdraw. The city released them from the contract.

A few months later, another group signed a letter of intent with the city to build a hotel at the same site. “But during the course of that process the financial markets began to drift,” he said. “They couldn’t proceed. There was too much risk.”

Despite these setbacks, Loman is optimistic. “I’m very confident that we’ll get a hotel here as soon as the market changes,” he said, noting several hotel chains have expressed interest in building in Burien in the future. “The demand is here. (A hotel) is needed. It will be a wonderful piece of our redevelopment.”

The wait to fill Town Square retail space may not last as long, but in the short term it’s a more complicated process. The primary problem is that leasing retail space in the complex involves working through the same maze with the construction loan that Urban Partners must navigate before condo units can qualify for financing.

“Urban Partners needs to talk to the bank, but they don’t know who (in the banking group) to talk to” right now, Loman continued. In the meantime, the developer tells him “yes,” businesses are interested in leasing this space. “But potential tenants want to know who (will hold the lease) before making a commitment.”

Although he has “no idea” how long it will take for Urban Partners to work things out with the banking group that now holds its construction loan, “I can’t imagine it will last more than 90 to 120 days. It’s too important an asset just to sit there.”