HomeMy WebLinkAboutReg 2022-03-07 Item 6D - Update - Wadajir Development AgreementCOUNCIL AGENDA SYNOPSIS
A.41,----- Initials
ITEM NO.
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Meeting Date
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Council review
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290$
ITEM INFORMATION
STAFF SPONSOR: B. MILES
ORIGINAL AGENDA DATE: 3/7/22
AGENDA ITEM TITLE Update on Forterra's Wadajir project on Tukwila International Blvd.
CATEGORY Wadajir
0
Mtg
Discussion
Date 3/7/22
❑ Motion
Mtg Date
❑ Resolution
Mtg Date
❑ Ordinance
Mtg Date
❑ Bid Award
Mtg Date
❑ Public Hearing
Mtg Date
❑ Other
Mtg Date
SPONSOR ❑ Council
►1
Mayor ❑ Admin Svcs ❑ DCD ❑ Finance ❑ Fire ❑ P&R ❑ Police ❑ PIF
SPONSOR'S Forterra is requesting the City execute a Development Agreement (DA) for the old Knight's
SUMMARY Inn property at 14110 Tukwila International Blvd. Staff would like to provide a briefing on
the various issues related to the DA and discuss next steps. No decision is needed at this
time.
REVIEWED BY ❑ Trans&Infrastructure Svcs ❑ Community Svcs/Safety ❑ Finance & Governance // Planning & Community Dev.
❑ LTAC ❑ Arts Comm. ❑ Parks Comm. ❑ Planning Comm.
DATE: MUTIPLE MEETINGS IN 2021 COMMITTEE CHAIR: HOUGARDY (2021 CHAIR)
RECOMMENDATIONS:
SPONSOR/ADMIN. Mayor's Office, Economic Development
COMMITTEE Forward to Committee of the Whole for Discussion, No reccomendation
COST IMPACT / FUND SOURCE
EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED
$N/A $N/A $N/A
Fund Source: N/A
Comments: N/A
MTG. DATE
RECORD OF COUNCIL ACTION
3/7/22
MTG. DATE
ATTACHMENTS
03/7/22
Informational Memorandum, dated 2/28/22
Powerpoint Presentation Slides
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City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
TO: Tukwila City Council
FROM: Brandon J. Miles, Business Relations Manager
CC: Mayor Ekberg
DATE: February 28, 2022
SUBJECT: Forterra's Wadajir Development Briefing
ISSUE
Forterra is requesting the City execute a Development Agreement (DA) for the old Knight's Inn
property at 14110 Tukwila International Blvd. Staff would like to provide a briefing on the various
issues related to the DA and discuss next steps. No decision is needed at this time.
BACKGROUND
Forterra is proposing the construction of a 154,500 square foot mixed use project on the old
Knight's Inn motel property, focused on supporting the environmental, social, and economic
sustainability of Tukwila's East African immigrant community. A total of 100 owner occupied
units will be constructed, with 25 one -bedroom units; 45 two-bedroom units; and 30 three-
bedroom units and approximately 14,000 square feet of commercial space. The project is
called Wadajir, which means "together" in Somali. Abu Bakr Islamic Center, which is located
across Tukwila International Blvd, is a community partner on the project.
Figure 1, Project Site and Surrounding Area.
The project aims to provide affordable, cooperatively owned, housing for households having
annual income levels 70 to 110% of King County's area median income (AMI)To achieve this
affordability goal, the project proposes to use Cross Laminated Timber (CLT) technology and
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INFORMATIONAL MEMO
Page 2
prefabricated modules to create a standardized set of building units. In addition to building
construction technology, the applicant is also requesting certain deviations from the City's
design and zoning standards to improve the project's financial feasibility.
DA's are permitted under Tukwila Municipal Code (TMC) 18.86 and are discretionary, legislative
acts of the City Council. The City has used DAs in the past for the expansion of Southcenter
Mall, Tukwila South, Bellwether Housing, and Tukwila Village. Major development and zoning
issues requested to be modified by the applicant as part of a DA for the Wadajir project include:
1. Structured Parking. The applicant is asking that the requirement to provide the
residential parking for the project within a parking structure in the urban renewal area be
waived.
2. Minimum Required Parking. The applicant is requesting that the number of parking stalls
required for the development be reduced from approximately 200 spaces to a total of 69
stalls on site. The applicant has proposed adding additional parking on S. 141St Street for
the project to have access to. This could increase the total number of on-site parking
stalls for the project to 80 stalls, depending on the find design of S.141st Street.
3. Building Setbacks. The applicant is requesting that the requirement for the building's
upper floors to be set back be waived because the CLT construction method using
prefabricated modules creates issues with modulation.
Note, there are other minor issues that will also need to be addressed as part of the DA. Staff
wanted to highlight the major issues for the council discussion since they impact project
feasibility.
The applicant has also requested that the City reenact its Multi -Family Property Tax Exemption
(MFTE) project to accommodate the project. The MFTE cannot be reenacted via a DA and
would require a separate City Council action.
DISCUSSION
Wadajir provides an opportunity to expand the number of owner -occupied affordable housing
units in south King County and would be the first project of its kind in Tukwila. As outlined
above, the applicant is requesting deviations from several development standards for the
project. Additional context on the request is provided below.
1. Structured Parking Requirements
TMC 18.43.070 requires that 75% of the required residential parking be in a structure such as a
parking garage'. Forterra is proposing to provide a surface parking lot at the rear of the building
along 42nd Ave South, as shown in the site plan below. The applicant has indicated that
structured parking could make the project financially unfeasible for owner occupied affordable
housing.
1 This provision only applies to projects within the urban renewal overlay.
INFORMATIONAL MEMO
Page 3
TUKWILA INTERNATIONAL BLVD
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PARKING k LOADING PARKING SUMMARY NOTES:
Figure 2. Forterra's Initial Site Plan and Parking Layout.
Staff Response
S 3AV CINLY
Structured parking can add additional development costs to a project, with a rough estimate of
the cost being $30,000 to $40,000 per stall. Thus, a 100 -stall garage adding between $3 and $4
million to a project's cost. The goal of the structured parking is to reduce the visual impacts of
large surface parking lots on Tukwila International Blvd and to allow more dense development.
By locating the building along Tukwila International Blvd. the applicant is screening the parking
lot from the street. However, the parking area would be visible to141st and 42nd Ave South
unless it has significant landscape screening.
Through the DA the City could waive up to 100% of the requirement that the parking be
structured.
Both Tukwila Village and Bellwether Housing provided structured parking for the residential
components of their projects. Because those are rental units and not ownership, they were able
to receive significant funding through the federal tax credit program.
2. Minimum Required Parking
Per TMC 18.43 and 18.53, the project is required to meet the following standards for parking:
• 1 stall per dwelling unit per 1 bedroom, plus
• 0.5 spaces for every bedroom in excess of 1 bedroom in a dwelling unit.
With 100 units, including a mix of unit types, the Wadajir project is required to have 153 stalls for
the residential portion of the project.
In addition to the residential parking requirements, an additional 1 stall is required for each 100
square feet of usable floor area for the proposed restaurant and 2.5 stalls for every 1,000 usable
square feet for the retail uses. Thus, the required parking stalls for the commercial uses on site
is about 44 stalls.
Based upon the proposed project and parking standards outlined above, the project is required
to have a total of approximately 200 parking stalls. The applicant is requesting a reduction of the
onsite parking to approximately 69 stalls on-site (or 80 stalls depending on the design of South
141st Street) and would pay to construct approximately 45 public parking stalls along South
141st Street and S 42nd Ave South.
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INFORMATIONAL MEMO
Page 4
The applicant provided a Parking Study prepared by Transpo Group, dated March 8, 2021. The
Parking Study concluded that 92 vehicle stalls would be needed during peak demand.
Staff Response:
Based upon preliminary analysis, staff believes that the City's parking requirement for nearly
200 stalls for this project is high and would likely result in unneeded stalls being constructed.
Staff's review, which is still ongoing, found that the following factors would likely result in the
project needing lower parking than what is required in the TMC.
1. The units at Wadajir will have access to frequent, convenient transit, including buses
along Tukwila International Blvd and the light rail station.
2. The unit mix for the project consists of a significant number of two- and three-bedroom
units. It's unlikely that the additional bedrooms will all generate additional parking
demand since these bedrooms may be used for individuals not driving (children and
seniors).
3. In 2019 DCD hired a consultant to examine parking usage at apartment complexes in
south Seattle, Tukwila, and other south King County cities. This parking study concluded
that the City's parking count requirements for affordable housing projects was too high.
The median parking demand rate for the apartment complexes surveyed in the study
was 1.33. Wadajir will have better transit options than many of the apartment complexes
included in the 2019 parking demand study.
4. King County's Right Size Parking tool, which utilizes a variety of factors, such as
location, transit options, and unit affordability, provides a parking ratio of .97 stalls per
unit.
5. The City's parking requirements do not take into account the ability to share parking
between residential and commercial uses.
Staff is still working to determine the appropriate parking demand for the proposed project. Staff
and the applicant are also looking at possible mitigation measures to address parking overflow
to limit impacts to adjacent residential and commercial areas. The table below presents some
possible mitigation measures. These are provided for information only and neither the City nor
the applicant are proposing any specific mitigation measures at this time. These mitigation
measures are not mutually exclusive and multiple measures could be utilized to ensure there is
adequate parking for the project and that any impacts to adjacent properties is minimized.
Proposed Mitigation
Measure
Impact
Staff Comments
Add public parking along S.
This option could add up to 45
Forterra has proposed paying
141st street and the west side
stalls. The stalls would
for the street improvements.
of 42nd Avenue
remain public and could be
used by anyone in the area.
Staff has not reviewed the
design for feasibility and code
compliance.
Leased parking
The applicant could examine
Typically, when offsite parking
securing an additional leased
needs to be secured for a
offsite parking spaces near
project the City requires the
the project for a certain
parking to be via a recorded
number of years. This would
covenant. This allows the
be a cost for the future
parking to remain indefinitely.
residents and businesses.
A concern with a lease
INFORMATIONAL MEMO
Page 5
83
approach is that either party
would have the ability to
terminate the agreement.
Enforcement of this provision
after the project is completed
may be difficult.
Car share service
Up to five parking spaces
could be reserved for a car
share service for residential
use.
Per code, one ride share stall
is required to be on site.
Additionally, the code states
that the rideshare spaces are
to be in addition to the
required onsite parking.
Parking Mitigation Fee
Require the applicant to
provide a onetime payment to
allow the City to better enforce
and manage existing on -street
parking in the area.
The applicant's Parking Study
notes that during the day only
20% of the current on -street
parking is utilized. With
funding, the City could provide
better signage along streets in
the area that provides on -
street parking, such as 42nd
Ave South. This funding could
also be used to help with
staffing for a limited amount of
time and to help set up the
RPZ program discussed
below.
Residential Parking Zone
(RPZ).
RPZ's are common in parts of
Seattle to manage on -street
parking in dense
neighborhoods, such as
Capital Hill and First Hill.
Parking permits are provided
to residents in the area and
parking is time restricted for
non-residents.
RPZs could be created using
42nd Ave South as a boundary
to ensure Wadajir's residential
parking does not impact the
neighborhood along the east
side of 42nd Ave.
A RPZ would require
administration by the City for
the issuance of the permits
and for enforcement. Signage
along the streets subject to
the RPZ would also have to
be installed.
Parking Improvement District
Washington State law allows
cities to create Parking
Improvement Districts to
manage and finance parking
in neighborhoods. The District
generates revenue with a
parking tax and/or
assessment on businesses.
This revenue could be used
for the acquisition and
management of parking
A Parking Improvement
District would need to apply to
a larger area and could not
apply to just one property.
This could be a longer term
strategy to address parking in
the Tukwila International Blvd
Neighborhood. It would take a
significant amount of time to
create a parking improvement
district and to use the funds to
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INFORMATIONAL MEMO
Page 6
Figure 3, Portion of S. 141st Street that could be used to provide more public, on -street parking.
84
facilities or improvement of
existing streets to include
better managed parking.
mitigate any parking impacts
associated with the Wadijar
project. This would not
provide immediate relief for
any parking impacts
associated with the project.
Reduce the project scale
Reducing the total number of
residential units and/or square
footage of the commercial
space would reduce the total
parking demand for the
project.
Forterra has expressed
concerns that any reduction in
total unit count or commercial
space could impact the
project's feasibility. Staff
acknowledges that typically
new multi -family housing
developments are at least 100
units due to financial
economies of scale.
Structured Parking
The applicant could add
structured parking on site.
However, they have indicated
that structured parking is so
expensive to construct that it
would make the project
infeasible.
Staff acknowledges that
structured parking is very
expensive to construct and
can make projects financially
infeasible.
Mitigation measures would likely include several of the options listed above.
Figure 3, Portion of S. 141st Street that could be used to provide more public, on -street parking.
84
INFORMATIONAL MEMO
Page 7
TUKWILA INT'L BLVD
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Figure 4, Conceptual Design of Parking Along S. 141St and 42nd Ave S2.
3. Building Setbacks.
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The City's design standards require tiered setbacks to provide modulation for residential
projects in the Neighborhood Commercial Center (NCC) zoning. The applicant has noted that
the use of modular mass timber construction hinders the ability to meet this requirement.
Figure 5 the image above shows the proposed massing for the building.
2 This design has not been fully reviewed by City staff and is provided for
discussion purposes only.
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INFORMATIONAL MEMO
Page 8
Multi -Family Tax Exemption (MFTE)
The applicant has requested that the City reenact it's MFTE program in order to help with the
financial feasibility of the project. The City had a limited MFTE in place for the Southcenter
District in order to encourage housing in the Transit Oriented Development area of the District.
The Southcenter MFTE program sunset at the end of 2019 and the City is no longer accepting
applications.
MFTE programs can provide either an 8 -year property tax exemption on the residential
improvements for a property or up to 12 years if an affordability component is provided. The
property tax exemption would apply only to the residential portion of the structure, not the
commercial portion or the land value. The City has significant flexibility in designing a MFTE
and using it to encourage certain development types. For example, in the Southcenter District
the City required a minimum average size for units and limited the number of studios in a project
requesting the MFTE. For example, the City could create a program just to apply to owner
occupied housing within a specific area of the City.
A MFTE program cannot be created via a DA and would require a separate legislative action by
the City Council. The program would also need to be developed that applies to specific
development types and/or geographical areas of the City.
FINANCIAL IMPACT
N/A.
RECOMMENDATION
Discussion only.
For next steps, staff suggests that this request remain in the Planning and Community
Development Committee for work in drafting a development agreement, which would be
forwarded to the full council for its review and consideration.
Design Review
A project of this size would require a public hearing design review process. However, since the
City Council may approve a DA for this project, staff is suggesting that the project be approved
at the staff level through administrative design review. Many of the design elements such as
parking, landscaped, modulation, and recreation space are being addressed through the DA,
thus the scope of the design review would be limited. To assist moving this project forward,
should the Council choose to approve a DA, staff recommends that design review be
administrative. The public would still have the opportunity to comment on the project since the
DA requires a public hearing before the City Council can take final action.
ATTACHMENTS
• Presentation slides for March 7, 2022 City Council meeting.
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➢ Provide an overview of the project.
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➢ No decisions are required tonight.
➢ Discuss Next Steps
About Wadajir
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DEVELOPMENT AGREEMENT
A REDUCTION OF THE
A WAIVER OF THE
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MINIMUM REQUIRED
STRUCTURED PARKING
PARKING FOR THE PROJECT
REQUIREMENT
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