This morning the State House convened to review the condo conversion bill (HB 2014) which passed its third reading by a vote of 94 to 1. The House version of the bill:
- Extends the notification period from 90 days to 120 days.
- Authorizes a city or county government to require developers to provide relocation assistance to low-income tenants in an amount to be determined by the city or county government. Currently, the state requires a $500 relocation assistance payment to low-income tenants.
- Prohibits construction within the 120 day notification. Though, construction may begin earlier provided the developer waits at least 12 hours after the last tenant vacates.
- Authorizes cities & counties to restrict the number of conversions.
On the other side of the aisle the State Senate will hold a public hearing on Tuesday, February 5th at 1:30 PM at 1:30 PM on January 22nd. The senate’s version (SB6411):
- Extends the notification period from 90 days to 180 days.
- Provides that notice of any county or city relocation assistance programs must be expressly stated to tenants.
- Requires developers to pay relocation assistance in an amount determined by city or county ordinance.
- Provides that the amount of relocation assistance may be adjusted annually.
- Allow developers to begin limited construction/remodeling within the 180 day notification period only if all tenants have vacated or if they provide written waivers to the developer.
- Authorizes cities & counties to restrict the number of conversions.
I have been in favor of some sort of change to the current requirements - 90 days notice and $500 towards low-income tenants - which is hardly anything. The cost to move and secure a new place to live is considerably more than $500. And, if you’re not low-income, you get nothing. But, I’m a little skeptical about placing limits on conversions. I’m a firm believer that the market will self-correct and adjust accordingly. And, it has.
1. “Repartmenting”
In the past six months, the slowing condo market has taken its toll in Seattle. At least three heavily promoted conversion projects have reverted, or repartmented, back to apartments. These include the Max in Greenwood as well as the Strata and Gables in West Seattle.
2. Repurposing
Another trend that we’re now seeing in Seattle is the repurposing of condominium projects to apartments. The most recent example was Expo62 in lower Queen Anne. However, it wasn’t the only one. The Landes on First Hill and the Chloe on Capitol Hill, both originally planned as condos, will be developed at apartments.
Also, there is speculation that more are on the way such as the recent announcement that the Domaine project on Queen Anne is currently up for sale as an apartment complex.
3. Constructing
Often overlooked is the new apartment boom that’s occurring in the Emerald City. Several high-rise apartment buildings are presently under construction or in development in downtown. These include The Olivian at 8th and Olive, Kinects on Minor at Stewart, the Aspira at Stewart & Terry as well as three additional high-rises on 2nd & Virginia and 3rd & Virginia, a twin-tower development at 6th & Lenora, and the massive 500+ unit 1200 Stewart project.
A number of smaller apartment projects are under construction around the Seattle Center including The Borealis (Denny & Dexter), Taylor 28 (Taylor & Denny) and the Bernard (Warren & John).
In the north end, The Tyee is currently under construction across from Green Lake, which joins the large apartment projects planned for the old Vitamilk (The Park 71) and Albertson’s (Alexan Green Lake) lots. And, in Greenwood, the old Leilani Lanes parcel is expected to be developed as apartments as well.
Capitol Hill will also see new rental inventory with the Packard (12th & Pine), The Pearl (15th & Madison) and the Agnes Lofts (12th & Pike). Additionally, two large apartment projects are planned on Broadway at Pine Street and the old QFC lot.
4. Fundless
The mortgage meltown and the evolving housing market have combined to dry up funding for conversions. Many developers, as reported by the Daily Journal of Commerce, are finding it difficult to obtain financing for conversions. Lenders are realizing that conversions are now too risky to fund. The heyday of mass conversions that we’ve experienced between 2005 and 2007 has passed.
The heart of the bills are necessary, namely the parts that softens the stress of displacement and provides relocation assistance for tenants. Though, artificially constricting conversions, which provide first-time homeownership opportunities, on the basis of a declining rental stock is simply unnecessary. Clearly, the market has adjusted as witnessed by the more than 1,000+ new apartment homes being built. The new apartments aren’t just for the wealthy, either. A number of projects are aimed towards the affordable apartment housing market.
Tags: Apartments, Condo Conversion, Seattle, Seattle Condos
Vulcan announced the opening of its third apartment complex, The Borealis, in the South Lake Union district. The development is the result of a land purchase deal with the city back in 2001 that’ll provide 53 workforce units available to individuals and families earning less than 80% of the King County median household income.
Address: 1139 NW Market Street
Address: 24th Ave NW & NW 57th (QFC site)
Address: Market between NW 15th & 17th
Construction at the former site of Seattle’s iconic Twin Teepees restaurant at 7201 Aurora Avenue has begun. The 4-story mixed-used building will include office space and a 24-unit apartment complex called the Tyee at Greenlake.