Tacoma Town Center debt collection continues locally as property foreclosure looms
A contractor who performed work at the once-planned Tacoma Town Center project near the University of Washington-Tacoma campus won a summary judgment and judgment in December in a debt collection case against the developer and a property investor.
The news comes amid mounting debt for the developer here and across the state line in Idaho.
The 6.4-acre Tacoma property, bordered by South 21st to South 23rd streets and from Jefferson to Tacoma avenues, has just one building completed by its original developer (who is not part of this case) at the planned six-building campus.
Puyallup-based Northwest Cascade on Dec. 13 received a judgment against Kurtin Properties, a San Diego-based real-estate investment entity, from Pierce County Superior Court Judge Andre Penalver, the result of an earlier order of default against Kurtin issued in September.
Kurtin was added to the case, originally filed against Tacoma Town Center Parcels LLC, after the contractor’s attorneys found that the LLC had conveyed a parcel tied to the case to Kurtin in early 2024.
NWC attorney Michael Murphy wrote in an Oct. 29 motion filing that sought both summary and default judgment that “Kurtin, a California corporation, recorded a deed of trust against the property in the amount of $3,000,000.00 on January 10, 2024 ... . Kurtin took title to the property on February 26, 2024, by a special warranty deed ... . Both the Kurtin (deed of trust) and the Kurtin deed were recorded after NWC recorded its lien against the property and commenced this action.”
No attorney is listed on the case file representing Kurtin Properties, and attorneys for Tacoma Town Center Parcels LLC withdrew from the case in January.
Before their withdrawal, the LLC’s attorneys filed a response to the initial complaint, with a general denial of the allegations and contended that the LLC was not a party to the contract with NWC.
The contract listed GIC Tacoma LLC as the property owner, which also shared the same Boise address as Galena Equity Partners, and a Galena Fund agent was listed as point of contact.
Murphy pushed back on that defense, stating in his October filing that “It is undisputed that TTCP (Tacoma Town Center Parcels) was the owner of the property when the work was contracted for and performed. TTCP was part of a group of companies operating under the umbrella of Galena Equity Partners. The Tacoma Town Center project was featured on Galena’s website.”
He also noted that “To the extent defendant made a mistake in listing GIC as the owner on the contract, that is on them. It does not somehow permit TTCP to avoid application of the lien statute.”
December’s judgment gives Northwest Cascade priority on its lien ahead of the interest of Kurtin Properties.
The judgment states that NWC is “entitled to foreclose its claim of lien ... against the property and the interest of Kurtin Properties, Inc. and against the interest of any persons claiming under it ... .”
Penlaver also issued an order granting NWC’s motion for summary judgment against Tacoma Town Center Parcels, with NWC entitled to interest “at 12%” and “reasonable attorneys’ fees” to be determined in a subsequent motion.
The latest actions were sought to clear the way to foreclose on the property and, via sheriff’s sale, recover the money owed NWC, along with “state sales tax, attorney’s fees, interest, lien fees, title search report costs, and other recoverable costs,” according to the judgment against Kurtin.
Murphy, in an email Jan. 2, told The News Tribune in response to questions that representatives for Kurtin had since reached out.
“They are requesting time to market and sell the property before a sheriff’s sale,” he wrote. “Northwest Cascade will be moving forward to get its attorneys’ fees awarded and an order of sale entered, but has agreed to defer a sale for 3 months.
“It will reevaluate any additional time as we approach 3 months,” he added.
NWC’s complaint, originally filed in September 2023, seeks payment for stormwater pond overflow and piping work to connect the site to the city’s stormwater system. NWC entered into the work contract around the end of August 2022, and filed a lien claim for more than $200,000 in February 2023 after nonpayment.
NWC isn’t alone in seeking repayments from Galena and its affiliated entities, who have faced multi-millions of dollars of debt collection in Washington state and Idaho from various entities.
Past-due property taxes at the undeveloped portions of the site now total more than $470,000, according to Pierce County Assessor-Treasurer records online. The debt goes back to 2022.
The county has a three-year time limit before pursuing tax foreclosure by filing a Certificate of Delinquency on a delinquent parcel with Pierce County Superior Court.
Other court action
Tacoma Town Center Parcels LLC took on the project in 2021 to continue after the original developer, Bellevue-based North America Asset Management (NAAM) was unable to generate sufficient financing, including EB-5 investment.
In April 2023, NAAM sued Galena over the Tacoma project in King County Superior Court for repeatedly defaulting on an agreement to purchase NAAM’s interest in Tacoma Town Center Parcels LLC.
Tacoma Town Center Parcels/Galena in September 2023 reached a settlement with the town center project’s architect, Caron Architecture, after Caron had sought more than $591,000 for its work. That case was dismissed in October 2023 ahead of its November trial date.
Then in January, NAAM was awarded more than $10 million from Galena in its lawsuit. Galena’s financial interests in Tacoma Town Center Parcels LLC and an LLC affiliated with a Vancouver, Washington, project known as 192nd Plaza Lofts were seized in an order issued to help satisfy the judgment.
In its home state of Idaho, Galena Opportunity Fund and its subsidiaries have been in court the past two years after failing to pay contractors in another stalled mixed used retail-apartment development in Meridian, Idaho.
The Idaho Statesman reported earlier this month that Galena owes $22 million in mechanic’s liens, interest and attorney’s fees to five of the project contractors.
Galena was ordered to pay up or risk the unfinished development, which sits across from Meridian’s City Hall, being sold to pay debts.
Previous reporting from The News Tribune contributed to this report.
Story updated Jan. 2 with comment from attorney for Northwest Cascade.
This story was originally published January 1, 2025 at 5:15 AM.
