Lakewood plans ‘game changer’ development to include retail, restaurant, residential
Lakewood has begun soliciting proposals from developers to create a restaurant, retail and apartments near the Sounder Station.
The city uploaded a listing for Lakewood Landing on a commerical real estate site the week of Feb. 8.
The project would span nearly 29 acres and redevelop a strip mall and a Washington state Department of Transportation office off Pacific Highway between 108th SW Street and Sharondale Street SW.
The city of 60,000 residents has determined the area surrounding the Sound Transit Lakewood Sounder Station needs more housing and economic development.
Lakewood economic development manager Becky Newton told The News Tribune that redevelopment of the area is one of the city’s “highest priorities.”
Annual tax revenues from sales, property and utility taxes could rake in up to $9.5 million for the state, $1.4 million to Lakewood, $800 to Pierce Transit and $275,000 to Pierce County, the city said on the project page.
The city estimates the development would bring in 1,433 permanent jobs.
Mayor Don Anderson and deputy mayor Jason Whalen consider the redevelopment to be a “win-win-win” for the city, residents and the school district by raising property values.
“All of these good things raise the economic boat for all of us and our residents,” Whalen said. “I think, economically, it would be a game changer for Lakewood. You’d see as a result of that project enhanced retail sales tax, property tax opportunities and brand development.”
Discussion of the project began in 2007, but the conversation was put on the back burner when the Great Recession hit, Newton said. In 2014, the city began talking with the Department of Transportation about its property off I-5 adjacent to the Sounder Station.
In September and October 2020, the city spoke to several developers for input on the project.
Phase one
The city has broken the project into phases. The first phase focuses on 12 acres adjacent to the Lakewood Sounder Station, which could add 760 housing units and 87,000 square feet of retail and office space with a courtyard.
The city’s site design includes an entertainment center, Amazon pick-up lockers and a brewery, but the private developer would make final decisions about how the area is developed.
“We want something with high visibility that will be sustainable for the future,” Newton said. “We are open to changes in details. It isn’t necessary to look like what we proposed, but we would like to see those elements in the proposal.”
The current property owners have been working with the city, Newton said. The property owners, JRD Pierce, Gary & Debbie Krumweide and Choo Kim did not respond to requests for comment.
Another phase of the project would focus on relocating the WSDOT office at 11211 41st Ave. SW and redeveloping the property. Newton said that portion of the project would take a while, but the city and state reached an agreement to sell the property and relocate the WSDOT facility elsewhere in the city.
The third phase would focus on land surrounding the current WSDOT office and its development, Anderson said.
Funding
If built as proposed, the first phase is estimated to cost $250 million, Newton said.
The city is seeking approval from the state Legislature to allow them to finance the project against future returns through “tax increment financing (TIF).”
“Basically, it allows for a project to estimate future sales tax as a result of the project and bond against that and pay over time on a yearly basis,” Newton said.
Lakewood is also exploring the “Local Infrastructure Financing Tool” (LIFT) program that allows selected local governments to use tax revenue generated by private business to help finance public infrastructure improvements with a state contribution.
Similar projects have been approved by the state, including the Bellingham Waterfront Redevelopment Project, the Bothell Crossroads Project and the City of Everett’s Riverfront Revenue Development Area.
Lakewood voters also likely would need to approve a bond in the future, Anderson said. Bond proceeds can be used for construction projects and be paid back with property taxes over time. A bond requires 60 percent approval to pass in Washington.
“One source of funding won’t satisfy the need for this,” the mayor said.
The soonest development could occur would be the second or third quarter of 2022, Newton said.
Elected officials say the Lakewood Landing project is part of a continual effort to bring economic development to the city.
It took years for the city and Clover Park School District to close Woodbrook Middle School. The 57-year-old building, needing nearly $15 million in repairs closed last year.
The school was located in the city’s southwest corner between I-5 and the Joint Base Lewis-McChord, which is becoming a manufacturing and warehousing district.
Lakewood worked to make road improvements, utility and water line repairs near the school to renovate the area, Anderson said.
“Commercial property there is popping up like mushrooms,” he said.
Amazon has announced plans for a Lakewood delivery station there, giving officials hope that more family-wage jobs will bring more residents and continued development.
“If you raise the bar on better economic development of under-utilized lands — which is exactly what this is — that can be better utilized to market,” Whalen said. “Amazon is coming in, potentially Tesla, with hundreds of thousands of square feet of light manufacturing and industrial warehousing space and potentially hundreds of new jobs. I mean, that kind of stuff is transformative.”
This story was originally published February 16, 2021 at 5:00 AM.
