Plans for the new apartment building next to the downtown Elks Temple are on life support.
Developers Rick Moses and Grace Pleasants are in default on their agreement with the City of Tacoma, which owns the vacant land north of the historic building. The city has given them until Nov. 28 to prove they can finance the project and to ask for new terms. Otherwise, the deal dies.
Portland-based brewpub operator McMenamins is proceeding with its plans to renovate the historic Elks Temple. They own it, and company officials have said they have a “competitive alternative” for financing. They plan to open in spring 2013.
On Wednesday, Moses wouldn’t comment on specifics other than to say he and Pleasants appreciate the city giving them more time.
For two years, during the worst recession in decades, the pair has tried to pull together a financing package that includes two loans, tax credits and federal mortgage insurance to build a retail- apartment-hotel building on top of a city-owned garage. The new building would complement and supplement activity at the renovated temple. The city would build the parking garage only if the developers could find financing for their part and buy the land.
The land-purchase deadline was Sept. 23, and it passed without action. McMenamins now has decided to put its hotel rooms in its own building, effectively divorcing the projects, and Moses and Pleasants have been negotiating with the city.
On Oct. 25, acting City Manager Rey Arellano sent the developers a letter outlining where everyone stands.
The developers have until after Thanksgiving to prove they can finance a now-smaller project. In the meantime, they have to show the city what they’ve spent so far.
Arellano wrote that the city is open to renegotiating an agreement with Moses and Pleasants but offers no guarantees. It also says that the more changes the developers ask for, the more the city will require in exchange; and it suggests the city might open up the site to bidders.
So far, the city has spent about $1.7 million: $900,000 to buy the land, about $63,000 in pre-development costs and about $740,000 in design plans for the garage.
An exact accounting of the developers’ costs so far isn’t clear, but they’ve hired architects and a general contractor, GLY, which is also an investor. They had received final design approval from the city’s Landmarks Preservation Commission and had started the process to obtain building permits.
All of those approvals were for a building containing a McMenamins-operated hotel. So if the developers are able to find financing and negotiate a new deal, the design and permit process likely will begin anew.
Kathleen Cooper: 253-597-8546
kathleen.cooper@thenewstribune.com
blog.thenewstribune.com/business
Twitter: @KCooperTNT
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