Tumwater brewery puzzle: 9 owners, 30 parcels, plenty of plans

When Chandulal Patel, through his company Tumwater Development LLC, snapped up the most iconic structures of the former Olympia beer brewery — the big beige buildings that overlook Interstate 5 and Capitol Boulevard — a sigh of relief could be felt throughout the community.

The most significant brewery buildings had finally changed hands, erasing a dozen years of false starts tied to the property and injecting some new hope into the beloved site.

The brewery sent hundreds of workers to unemployment lines when then-owner SABMiller Brewing Co. closed it in June 2003. The site has sat empty and unused since.

Patel is just part of a large puzzle of property owners that now own part of the former brewery land that runs north of Custer Way into the Deschutes River basin and south along Capitol Boulevard to the southeast corner of Tumwater valley, where the city owns property.

  

In total, nine groups own 30 parcels that hold the hopes for game-changing development that would transform the derelict, hulking buildings into beacons for the future of not just Tumwater but also the region.

Patel, who splits his time between Southern California and India, and his representatives met with city of Tumwater officials in April about their purchase, said Heidi Behrends Cerniwey, Tumwater’s assistant city administrator.

“They have a sincere desire to engage the community in their strategy,” Cerniwey said. She also reiterated what Patel representative Ronny Vogel shared with The Olympian following Tumwater Development’s $4 million acquisition: They plan to first focus their redevelopment efforts on the former brewery warehouses along Capitol Boulevard, followed by the main buildings on the knoll.

But not all of the land is intended to become destination development. Here’s some of what the other owners of former brewery property have planned for their parcels:

LOTT Clean Water Alliance

  

LOTT, the organization that provides sewage treatment services to the region, acquired 43 acres of brewery property in the Tumwater valley in 2011-2012 for a project to be called the Deschutes Valley reclaimed water plant, which would produce 3 million gallons of reclaimed water per day, said Lisa Dennis-Perez, interim director of environmental planning.

But that was then, she said. LOTT isn’t going to need that additional treatment capacity as soon as they had thought, which pushes the construction date past 2024, she said.

LOTT doesn’t need the plant by 2024 for several reasons: growth slowed during the recession, a water conservation program has proven successful and the organization is beating its permit standards for treating water, which has freed up capacity, Dennis-Perez said.

“It has delayed the need to build,” she said.

City of Tumwater

  

The city owns four parcels, including land in the southeast corner of the valley near Cleveland Avenue. The city needed that land because it has plans to extend E Street to Cleveland Avenue as a way to alleviate congestion at Capitol Boulevard and Custer Way, and at Custer Way and Cleveland Avenue, Tumwater permit manager Chris Carlson said.

The three other parcels are closer to Capitol Boulevard. One is set to become a constructed wetland to filter stormwater; one will become home to a municipal well field owned by Olympia, Lacey and Tumwater; and one will become a roadway to provide access to Tumwater Valley Golf Course and Valley Athletic Club, Carlson said.

The three cities acquired the brewery’s water rights in 2009, which is the basis for the future well field, he said.

George Heidgerken (Falls Development LLC, Hi Roads LLC and Old Brewhouse LLC)

  

Heidgerken, a Centralia developer who also has an office in Tacoma, owns the most former brewery properties through Old Brewhouse LLC, Hi Roads LLC and Falls Development LLC — a total 14 parcels. All are north of Custer Way, including, until recently, the historic brick brewhouse below Tumwater Falls.

Heidgerken donated that building to the city of Tumwater last month. Jon Potter, a consultant with Falls Development, told The Olympian that Heidgerken “thought this iconic building should be under someone else’s wing.”

It’s not clear what Heidgerken plans to do with the remaining property, although he has been a font of ideas in recent years. For example, Heidgerken owns a warehouse on Custer Way, once referred to as the RST Cellars building, which he has pitched for a hotel or apartments.

No definitive plan has materialized yet.

South Sound Bank and its buyers

  

The bank still owns two parcels on Capitol Boulevard, but bank President and Chief Executive Dan Yerrington said both are under contract and the sale could close on July 1. The buyer, according to city of Tumwater data, is Cinnabar Growth Capital, a San Jose-based investor with an interest in the Tumwater and South Puget Sound Community College plan to create a public education and training facility tied to the craft beverage industry.

Cinnabar representative Michael Weinstock could not be reached last week. According to the city, Cinnabar would develop the property to complement the city and college plan by bringing “breweries, distilleries, cider-makers, restaurants, a hotel or offices” to the site.

The bank at one time owned five former brewery parcels, but not because it wanted to. The bank was the lender of record for a mixed-use project proposed by developer Tri Vo called Bellatorre. But the recession arrived and the bank wound up foreclosing on the property.

“Timing is everything and he got caught in the wrong place at the wrong time,” Yerrington said.

Three of those parcels were sold right away: to a hotel operator, to the owner of a local school, and to the city of Tumwater for the stormwater wetland.

The hotel, shown as parcel “E” on the map, is now home to a La Quinta Inn & Suites, while parcel “D” on the map, closest to Tumwater Valley Drive Southeast, is home to Serendipity Academy at the lodge.

Yerrington said the bank has owned the property for about 10 years. Selling the three parcels relatively quickly eased the pain of the foreclosure.

“We’re going to do OK in the long run,” he said.

  

This story was originally published May 14, 2016 at 1:16 PM with the headline "Tumwater brewery puzzle: 9 owners, 30 parcels, plenty of plans."