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Kenmore takes loss, moves on

  • Written by Don Mann
A week after the city of Kenmore terminated its development agreement with Urban Partners for the Kenmore Village project — its highly anticipated downtown renovation venture that took five years to ultimately go nowhere — it did what it needed to do.

They called a town meeting.

Development of the 9.6 acre site at the northwest corner of NE 181st Street and 68th Avenue Southeast — right across from the new city hall — did not move forward in the wake of the severe economic downturn beginning in 2008. Los Angeles-based Urban Partners, in the end, could not secure tenants, most notably an anchor store to attract steady customers.

The city finally released itself from its commitment with a $700,000 buyout, though most of it was payback of earnest money UP paid in deposits to keep the venture afloat.

According to Kenmore Deputy Mayor Bob Hensel, the city took about a $250,000 loss in the end.

And that’s why more than 60 Kenmore citizens filled the council chambers last Monday night — requiring city staff to search for more chairs — to ask why it happened, how it happened, and where things go from here.

Hensel began the proceedings with some history as he chronicled events dating back to 1998 with the city’s incorporation.

Hensel enumerated the council’s successes and failures that led to the project’s demise, but hinted of good things to come.

“We’ve been approached by a third party to purchase a parcel — about one-third of that property,” he said. “Unfortunately those items are privileged and are in executive session now so we won’t be able to answer any questions about those.”

Hensel went on to say the city owns the property — and has collected “probably $3 million in rental revenue.”

Kenmore citizens asked several critical questions, including why the council paid over $400,000 in consulting fees — people’s tax money to a project that tanked.

Said Hensel: “It didn’t work out the way we planned because the economy went south. If it went the way it should’ve we would have 300 units of housing and all that retail ... but unfortunately things didn’t turn out the way we hoped ...We did what we thought was right.”

Another audience member, a former Kenmore planning commissioner, he said, asked why the new development plans were not available to the public.

“Everything’s always secret,” he said. “There was a time when everything always wasn’t a secret deal ... everything was not in executive session.”

Mayor David Baker was quick to answer: “One of the reasons is when property negotiations are going on it’s our fiducial responsibility to make sure we get the best price we can. Our asking price may be ‘this much’ but when they start negotiating it may come down to ‘that much.’  ... That would undermine the whole process...That’s one of the reasons it has to be kept in executive session, and state law specifically says that.”

Later, after some contentious citizen debate, Councilmember Allan Van Ness took the mic: “I can understand the frustration of the people in this room,” he said.” I’ve been on the council for six years and it still frustrates me with the time it takes to get anything done. All the permitting and how much it costs in the process ... We worked on disengaging with Urban Partners for at least a year. Many of us are dissatisfied with what they’ve done — or haven’t done. We ran into snags ... I hate to say too much negative but they had a legal right to that property via agreement. And the city as owner now was legally prohibited with negotiating with anybody else ... Fortunately we’ve resolved things and we’re now free to deal with that property as we see fit. We don’t have to wait until the end of 2013 ... While I don’t like to pay somebody to go away, it was necessary in this case ...”

Van Ness paused for emphasis.

“Looking back four years ago who would have predicted what’s happened with this economy,” he asked.

“It’s been a broadside blow to everybody.”

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