Business

Hey, McMenamins, remember Tacoma? Port of Kalama next on to-do list

This rendering shows how the development of the Port of Kalama McMenamins — which includes a 40-room hotel, meeting rooms, rooftop brew pub with a river view and a smallerpub at the Port of Kalama’s Ahles Point — is expected to look.
This rendering shows how the development of the Port of Kalama McMenamins — which includes a 40-room hotel, meeting rooms, rooftop brew pub with a river view and a smallerpub at the Port of Kalama’s Ahles Point — is expected to look. Courtesy

Yet another project has moved ahead of Tacoma on McMenamins’ to-do list.

The Port of Kalama on the Columbia River this week inked a deal with the Portland-based developer for a Hawaiian-themed hotel and brew pub at its property.

The property should be up and running in less than a year, according to the contract with McMenamins, said Liz Newman, Port of Kalama marketing and communications manager.

But what about Tacoma?

Two local projects have been slow to come to fruition. The historic Elks Lodge on Broadway has pushed back deadline after deadline as the company sought investors for an ever-ballooning deep renovation project.

McMenamins chief financial officer Chris Longinetti said it’s taking time to assemble the needed financing for the Elks Lodge renovation project.

“We are working with our financing partners right now and hopefully we will have an announcement soon,” he said by phone Thursday afternoon when asked when construction on Elks would begin or when it might open.

A company spokeswoman said construction on Elks could start “by summer.”

In November 2015, the company made a push for local investors for its Tacoma project. Longinetti said they have enough investors now, but financing also involves a complex web of historic tax credits and construction lenders, he said. That takes time.

McMenamins bought the Elks building in 2009. Tacoma waited as the company weathered the recession, then moved ahead on a big project in Bothell. That facility, the Anderson School, opened in fall 2015.

McMenamins had to complete the Bothell project first because it was owned by the city, which set performance deadlines as a condition of the sale. That pushed the Anderson School ahead of the Elks.

As for the newly announced Kalama project, the port is constructing the shell and utilities up to but not including interior fixtures, Newman said. McMenamins will complete finishes on the four-story structure. Once McMenamins takes possession of the shell it will begin paying rent at $42,500 per month, Newman said.

The Hawaiian-themed development on a 1.5 acre site includes a 40-room hotel, meeting rooms, rooftop brew pub with a river view and a smaller pub at the Port of Kalama’s Ahles Point.

Newman said the building could be open within a year, according to the contract commissioners approved Wednesday.

“We expect this development to draw even more visitors and potential business interests to the area,” said the port’s executive director, Mark Wilson, in a news release.

Historically the company has worked on one project at a time. Newman said the port’s contract with the hotelier and brew pub company says McMenamins will complete the project within 360 days.

“Because of the port’s involvement (in building the hotel’s shell), that will give us the capacity to launch Elks” at the same time, Longinetti said.

McMenamins also has its thumb on a project just across the street from the Elks Lodge, at the 125-year-old Old City Hall building, now owned by the city of Tacoma. McMenamins was the top choice of four companies that bid to revitalize the Tacoma landmark.

The two-property complex, if developed, will be a first for McMenamins.

About two years ago, the McMenamin brothers — Brian and Mike — said the Elks property could be open this spring; a few months later that timeline slipped to summer. Stated deadlines for the property’s development have changed many times, with the latest being fall of this year.

Cost estimates for the Elks Lodge’s renovation also have increased as the company learned more about the building and its condition. The company had once thought renovating the beaux-arts-style lodge would cost around $25 million.

Last year, contractors cleared out tons of garbage, asbestos and lead paint from the structure and its adjacent annex. At that time, the company said it would cost around $32 million to renovate the lodge.

The company has said the Elks Lodge at 565 Broadway would feature a pub, three restaurants and a hotel with about 45 rooms. One former ballroom would include cabin-style rooms with a terrarium feel.

OLD CITY HALL STILL IN PLAY

Once the Elks Lodge is complete, company staffers have said Old City Hall would be its next focus.

Elly Walkowiak, business development manager with the city of Tacoma, said the city still hopes to have a McMenamins project at Old City Hall. Walkowiak is among those at the city who have negotiated with the company on a development agreement for Old City Hall.

Next month will mark a year since McMenamins placed negotiations with the city on hold so it could focus on attracting investors and starting construction on Elks, Walkowiak said. At the time the negotiations were paused, Walkowiak said the company told her they planned to start construction on Elks in the first quarter of 2017, the end of which is just a few weeks away.

Walkowiak said Thursday that the work of negotiations was almost complete before the pause.

“We made a lot of progress on that, and there isn’t much yet to do,” she said. “We would like to complete that as soon as possible.”

She said the company has responded to her notes over the past several months, as she expressed the city’s interest in continuing negotiations on the development agreement and purchase and sale agreement.

“We respect the McMenamins’ decision to focus on Elks first,” Walkowiak said. “We are really excited and looking forward to them getting started on Elks, as is the community. We are hopeful they will start very soon.”

June will mark two years since the Tacoma City Council voted to buy Old City Hall, a building that once housed a jail in its basement in Tacoma’s north downtown. The city bought the property for $4 million after the previous owner continued to delay repairs that led to the city labeling it as a “dangerous building.”

The city received four proposals to renovate Old City Hall, and McMenamins’ came out on top with its vision of 60 hotel rooms, bars showcasing the jailhouse, clock tower and rooftop greenhouse; a rooftop restaurant; soaking pools; community/private meeting and event spaces; and a gift shop.

The city has said any Old City Hall project would include deadlines to ensure the structure doesn’t sit empty long.

While some might be chagrined at Kalama landing its hotel project and it being done in a year, Newman said the port’s executive director reached out to McMenamins a decade ago. McMenamins also is not gutting and renovating a century-old landmark, she said.

The Kalama project “is all new construction on a site we had designated for some type of project like this for many years,” Newman said.

News Tribune archives contributed to this report.

Kate Martin: 253-597-8542, @KateReports

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