Loading...
2017-05-24 Planning Board MinutesCITY OF EDMONDS PLANNING BOARD MINUTES OF RETREAT May 24, 2017 Chair Rubenkonig called the retreat session of the Edmonds Planning Board to order at 7:00 p.m. in the Brackett Room of City Hall, 121 — 5th Avenue North, Edmonds, WA 98020. BOARD MEMBERS PRESENT Carreen Rubenkonig, Chair Nathan Monroe, Vice Chair Alicia Crank Phil Lovell Daniel Robles BOARD MEMBERS ABSENT Todd Cloutier (excused) Matthew Cheung (excused) ANNOUNCEMENT OF AGENDA The agenda was accepted as presented. STAFF PRESENT Rob Chave, Planning Division Manager DEVELOPMENT SERVICES DIRECTOR REPORT TO PLANNING BOARD Chair Rubenkonig referred the Board to the written report that was provided by the Development Services Director. There was no discussion relative to the report. DISCUSSION WITH BARTELL'S REPRESENTATIVE ABOUT EDMONDS DEVELOPMENT OPPORTUNITIES Mark Craig, President of Henbart, introduced himself and shared background and history information about the Henbart LLC Company (formerly the George Henry Bartell Company, which was formed in 1924). The Board Members introduced themselves, as well. Mr. Craig explained that Henbart developed the Bartell's Drug Store at Westgate Village in 2001. The company only owns a small number of its stores, and most of its locations are leased. Henbart looks for acquisition opportunities in the marketplace, particularly focusing on properties it owns, as well as properties that are adjacent to their existing properties. Henbart entered into a Purchase of Sale Agreement with the previous owner in 2013. At that time, the center was strong with a number of retailers, but he felt that the additional property, with the slopes and trees as the background, would make an excellent location for residential or mixed -use development. He later learned of the City's process to rezone the Westgate area. He advised that closing on the property was delayed to address environmental issues, and the final closing occurred within a week of when the City Council approved the Westgate Subarea Plan. Henbart engaged Studio Meng Strazzara to begin to create what they thought would be a special type of development, given the opportunity to use the treed slope as the backdrop, but also take advantage of all of the amenities that would be available in the area. Board Member Lovell asked if Henbart has maintained an interface with the residents living in the area throughout the planning process. Mr. Henbart answered that Henbart hosted a public meeting just prior to the ADB review, and 40 to 50 notifications were mailed out to immediate neighbors. Board Member Lovell asked if Henbart plans to have additional public meetings to keep the public informed of its plans. He recalled that when the Planning Board conducted its review and public hearing relative to the Westgate Subarea Plan, there was a lot of public comment, and most were concerned about having monstrous buildings that completely change the character of their neighborhood. They were also concerned that too many trees would be removed, and the buffer between the residential and commercial development would be lost. The Board did a lot of shuffling to address these issues, and he is curious to know whether or not there will be as much public interest in the proposed plan going forward. Mr. Craig said there was a good turnout at the meeting Henbart hosted (about 20), and he feels strongly that everyone left with their questions answered. He said he also attended the City Council meetings where the Westgate Subarea Plan was the topic of discussion, and he heard a lot of the neighbor's concerns. However, those in attendance at the most recent public meeting seemed more concerned about traffic and parking than with the mass, size and scale of the proposed buildings. Mr. Chave noted that no one was present to testify at the public hearing before the Architectural Design Board (ADB). Board Member Robles asked if neighbors on top of the slope are still concerned about the impacts that rooftop mechanical equipment can have. Mr. Chave answered that most of these concerns were addressed at the public meeting that was held prior to the ADB hearing. The notion is that the residents were satisfied, since none of them attended the ADB hearing. Mr. Craig commented that one resident on top of the slope was particularly concerned, but it was noted that the slope would not be impacted by the proposed development. Chair Rubenkonig asked if Henbart plans to have additional public meetings as the project progresses, and Mr. Craig answered affirmatively. He explained that Henbart tends to build projects to hold, and there are no plans to put the properties on the market once the project has stabilized. Charles Strazzara, AIA, President of Studio Meng Strazzara emphasized that he works with both types of developers. One type is considered a merchant builder who builds to lease, but once their projects are leased, they look to sell and move on. Henbart intends to hold the property, which means that quality products and materials will be used, and the project will be deliverable both inside and out. This type of developer tends to be more cautious about the neighborhood context because they intend to hold the development. He suggested that much of the concern from adjacent neighbors is based on confusion and false assumptions. Henbart has done a great job addressing their concerns, and that is why no one was present to testify at the ADB hearing. He said addressing adjacency issues has been a common goal from the beginning, given that the single-family residential use abuts a more intense use. They tried to be extra compassionate in terms of adjacency, recognizing that the slope and trees provide an excellent buffer. The intent was to maintain their existing environment as much as possible, and the pattern of vegetation they see throughout the seasons should not change. Mr. Craig said he was asked to comment on the types of communities and neighborhoods Henbart prefers to develop in. As a long-term holding company, their focus is very specific to real estate and location. He referred to the Valley Commons Project, which Henbart recently completed at 56th and 22nd in Ballard across from the library and Ballard Commons Park. The site was developed with 84 for -rent residential units, 20,000 square feet of retail space, and 22,000 square feet of office space. The project took advantage of the City of Seattle's Multi -Family Tax Exemption (MFTE) Program, which is intended to result in more affordable units. He also noted that Henbart is currently developing a site on Capitol Hill across the street from the light rail station entrance at Broadway and Denny. This development should be completed in August and will include 44 residential units and 3,500 square feet of retail space. They were particularly attracted to this site because of its close proximity to the light rail station and other amenities. They are also working on a project on Central Way in Kirkland, which should start in 2019. The project will be similar to the one being done on Capitol Hill with residential and office space. It will be across the street from Peter Kirk Park, as well as the library and transit center. He said they were attracted to the Westgate site in Edmonds because of its close proximity to walkable amenities. Chair Rubenkonig noted that the idea of mixed -use buildings is hardly new. Her grandmother, and others who were money challenged, lived on top of the farmers store. The rooms shared a common bathroom down the hall, but they were located in the center of town. She never felt her grandmother lacked for social standing as to where she lived. She is glad to see mixed use buildings coming back again in the center of town to provide a sense of place and be part of the community. Mr. Craig explained that retail is such an important component of a mixed -use development, and they put a great deal of focus on not only the design layout and functionality of the retail, but also on the types of businesses located there. Planning Board Minutes May 24, 2017 Page 2 Board Member Robles asked if Henbart developments tend to focus more on lower -density, higher income development or higher -density, lower income development. Mr. Craig answered that, by virtue of the location of their projects, the focus is definitely not on lower income. However, the projects on Capitol Hill and Ballard are part of the MFTE Program, which is an affordability program implemented by the City of Seattle. Henbart will apply to participate in a similar program that is administered by the City of Edmonds. Board Member Lovell pointed out that housing costs are going up rapidly in the Seattle area, and it seems that they are no longer talking about affordable housing. He asked what Mr. Craig anticipates the rental rates will be for the proposed Westgate development. Mr. Craig said the City is currently working on a matrix that will set the rental rate parameters for the tax exemption program, which will be modeled after the City of Seattle's table but based on Snohomish County values. Board Member Lovell asked if escalating construction costs mean that the calculations being done for rental rates and the cost of construction will cross at some point to make the projects pencil out. While the concepts and principals are great, there are a number of things in the economy that are moving faster. Mr. Craig answered affirmatively, but he cautioned that they are proceeding with their eyes wide open. They are working with a number of contractors in an effort to keep the costs down. He pointed out that although the market rate for rent is much higher in Seattle, the construction costs are the same. While they are gearing up internally to move the project forward, he acknowledged that it will be challenging. Mr. Chave noted that the proposed unit sizes are relative small, and affordability is a relative term. He reminded the Board that smaller units is one housing type that is lacking in Edmonds because the old zoning codes tended to push towards large units based on the density requirements. Because there is no specific density requirement for the Westgate Subarea, it is hoped that the market will decide the size of the units, rental rates, etc. Mr. Craig said he heard early from City staff of the City's desire to bring smaller units into the market, and they tried to work this into the design. Mr. Chave said the City's Housing Strategy calls for providing as many housing choices as possible, and that was one of the hopes for Westgate. Questions were raised about whether or not the proposed project would be developed with the idea that the units could be sold as condominiums at some point. Mr. Craig emphasized that is not Henbart's intent. Mr. Strazzara advised that all of his design work is done to condominium standards, regardless of whether they are intended to be sold or leased. Board Member Crank pointed out that the development in which she previously lived attempted to convert to condominiums, but learned that it was more difficult to sell the smaller units because they offered fewer amenities. They had more success with the larger units. She asked if the units proposed at Westgate would have washers and dryers in each unit, and Mr. Craig answered affirmatively. Board Member Crank commented that this would help deflect from the smaller size of the units because they provide a certain convenience factor. Board Member Crank emphasized that the City must be very deliberate when talking about affordable housing as opposed to low-income housing, which has such a stigma. The dialogue should be intentional to make it clear the units would be affordable to those in the median income. She said she hopes the Board and Council can be intentional in tying these together. Board Member Robles recalled that "aging in place" is also a goal of the City, and the intent is to avoid driving people out of their homes because they cannot afford to keep them. For example, a homeowner could lease a portion of his/her home or construct an accessory dwelling unit on the property, which would provide rental income that allows them to stay in their homes as opposed to turning the property over to a developer. He emphasized that part of the branding for affordable housing should include the idea of allowing people to age in place. He asked if Henbart's buildings are designed with that in mind. He noted that the standards for condos are different than for apartments. Mr. Strazzara said it is not a development strategy at this time, but they make it part of their concept of design. For example, their designs provide parking, secure buildings, and other amenities that an owner would want. However, for -rent products have such a strong market in the region, that is what is currently being constructed. Mr. Strazzara said what the board is doing as a group right now is perfect and forward thinking, and it will set the City up for success in the future. He recalled that seven years ago, 90% of his company's mixed -use projects occurred in the large cities. However, he predicted that, as the cities become more expensive, certain parts of the demographic would look elsewhere for similar value (walkability, connectivity, security, services). Now, about 90% of his projects are done in the outlying areas, Planning Board Minutes May 24, 2017 Page 3 and cities that have responded to this change are doing great. How the City positions itself will determine its success in the new marketplace. He shared the following examples: • The City of Kent's downtown code did not allow housing, and this model was no longer effective after the market changed. They approached him for advice, and he encouraged them to change their codes to allow residential development to bring people to the area to shop, walk, etc. The Platform Project was done as a pilot program. The 176- unit project was super successful and all units were quickly leased. Another similar project has now been developed in the area. • He was approached by representatives from the City of Auburn about how to encourage development on vacant lots in their downtown area. He pointed out that empty lots are the worst thing for a downtown core because they create a loss of connectivity and walkability. The City changed its zoning to allow residential development and the Trek Project was constructed on a vacant lot that was owned by the City of Auburn, near where the transit platform was built. The project provided parking and commercial space on the ground floor, with four floors of residential development above. Other projects are now moving forward in this area, as well. • He worked with the Maple Valley Planning Commission to rewrite the city's codes for the Five Corners area, which is considered their major retail hub. Based on a study done by a third -party consultant, only 8% of the housing stock was multi -family, compared to an average of between 20% and 30% for other outlying cities (Edmonds is around 40%). Because only 8% of the housing stock is multi -family, Maple Valley quickly became unaffordable for people to live and work there. He advised them to reincorporate density and housing into select areas of the City. Once the zoning was changed to allow flexibility, two large projects were done that resulted in nearly 400 new units. The new residents are now able to access amenities within a walkable distance. • Federal Way is another example of having a bad stigma by having a lot of apartments that are focused in a few areas. He advised them to encourage housing in the retail core, and development took off. • The Meeker Street Corridor in Kent is prototypical of the type of auto -oriented development that occurred because of code constraints (single -story building with surface parking around it). This same type of development is present in Edmonds, as well. The City of Kent has been able to revitalize the corridor by changing the zoning to allow residential development to occur and by having more flexible commercial requirements. He noted that it is not desirable to have too much commercial development in the core commercial areas, and it is important to be flexible on the percentage of commercial space required and how to best integrate it into the mixed -use developments. Board Member Robles pointed out that low-income units have higher densities and higher -income units have lower densities. However, lower densities mean fewer people going to the retail businesses. He asked if there is an equation to determine the correct mix. He also pointed out that Edmonds is still a "commute to downtown Seattle" community. You can't move much further north and still have a decent commute to Seattle, and the Westgate intersection will be a highly -valued place to live. Mr. Strazzara agreed and said he considers the project to be transit -oriented development (TOD) because of its proximity to the urban core. Again, he said it is great that the City is having this dialogue and recognizes the need for flexibility. Mr. Chave said Highway 99 is a classic example of the problems that the City of Kent experienced on Meeker Street. Although the corridor has been zoned for high-rise development for a long time, it requires two -stories of commercial development. The common type of development along the corridor is single -story commercial. The City changed its zoning a few years ago to allow development that is entirely residential, with horizontal mixed use, etc. Suddenly, the City is seeing more interest from developers. Mr. Strazzara said it is important to match the current market or the developers will not come. There is a performance or risk/reward that developers need to hit. In Maple Valley, they wanted walkability and pedestrian corners. Since the commercial requirement could not be beneath the podium deck, they did a commercial center in the heavy traffic corner of the project, and it connects to the apartments behind. They also allowed horizontal integration. Chair Rubenkonig asked if this is the first Bartell's store in Snohomish County that has a residential component. Mr. Craig answered affirmatively. Mr. Strazzara emphasized that having 90 units of housing in an area that is walkable is considered a TOD as long as the vertical and/or horizontal integration has a quantifiable pedestrian-scape that is within walkable distance to services. He said he hopes that this type of development occurs along the entire corridor. Board Member Crank expressed a desire to review the proposed plans for the Westgate Project. Chair Rubenkonig advised that it was not the intent to go through the plans at the retreat. It was noted that the project has been reviewed by the ADB, and Mr. Craig agreed to meet with Board Member Crank to review the specifics of the plan. Planning Board Minutes May 24, 2017 Page 4 Board Member Robles observed that the City is already fulfilling its Growth Management Act mandate for growth based on its current zoning. They are not looking to make themselves attractive for multi -family development in other areas. However, they are looking for advice on how to make the City attractive to great projects that are consistent with Edmonds values. Mr. Strazzara agreed it is important for the City to maintain its values. Board Member Robles commented that "aging in place" also means giving people the same opportunity to develop their own property as a construction company coming into town. They don't want to encourage developers to buy single-family lots and develop condo units. Mr. Strazzara referred to the questions submitted prior to the meeting by the Board and responded as follows: What kinds of communities and neighborhoods do you prefer to develop in and why? Architects and developers want to create high -quality, creative projects, which is common with the City's goals. Developers want to develop quality products that resonate with the community they are being built in. That is what has the best chance for success and longevity. It is important to be flexible with how you get there with a commitment to community values while embracing the need to allow for growth change to the existing built environment. No developer will be interested in redeveloping a one-story retail building in the same model. The model has changed, and the City must be adaptable to the changing environment. It is important to be forward thinking. Lifestyles are changing and Edmonds must adapt now and in the future. He referred to a project in downtown Phoenix, which was required to meet an erroneous parking standard, yet many of the spaces have never even been used. He encouraged them to change their standard. Years ago, most people owned cars, but that is no longer the case. Many of the young people that work for his company do not own cars and prefer to walk, commute, and ride the bus. It is important to have a partnering mentality with the private sector, developers and the design community. It is about opening yourself up to developers and architects by identifying the intentions you want to achieve via development (walkable neighborhoods, a sense of place, a sense of arrival, and amenity features)., and then talk about how they can get there. As long as the intent of the code is met, you get much more progress. Edmonds is one of his favorite cities to work in because of what they are doing, and he encouraged them to do more. He had a project in Redmond called the PCC and Avondale Plaza, which received the People's Choice Award for Excellence in Design in 2006 and 2012. The project met the criteria he described above of forward thinking, partnering, and being flexible. It was done as a pilot program on existing parcels that were rezoned to neighborhood commercial. The regulations were taken away and new ones were created under the "best intention" rule, which provided maximum flexibility, including reductions in traffic and parking requirements. When considering development what do you look for as far as City regulations? He prefers to have informal strategy sessions and understanding between the design team and City staff, which the City already does. Openness to discussions on parking regulations and the changing regional transit scene and new urbanism are important, as well. People want to live, work, shop, and play in an environment that is less reliant on cars and more walkable, and the City should be open to providing these areas. It is also important to have an equitable entitlement process and associated fees. Many developers turn down great sites because of the high impact fees associated with the parcels, and this is hurting downtown cores because there are empty blocks. The City should be open to offering reductions and incentives to those groups with stronger -designed projects. Impact fees could be incentive based. What local regulations or incentives are especially important for developers. Development incentives are the best way to meet common goals of a desired development quality. The most commonly asked question of developers is, "What do we get in return for meeting the City's zoning requirements?" As long as a developer feels there is mutual understanding of the incentive program, you get good projects. Incentive programs can even be weighted more to the City's advantage, as long as developers get something valuable in return. For example, he commended the City for allowing an extra floor of height in exchange for other amenities in the Westgate Subarea. Board Member Robles asked if staff would act as adjudicator if the Planning Division is given a fair amount of space to negotiate for incentives if and when a really great project comes forward. Mr. Strazzara commented that the City has already adopted an incentive zoning program, and Bellevue has one, as well. Base zoning is regulatory and by the books, but allowing flexibility for creative design via incentives results in better designed buildings. Most developers want to build quality products, but they want to make sure that whatever they do to add value for the community results in some type of incentive to offset the additional cost. Cities that do not have good incentive programs in place get mundane projects because there is no reason to go beyond the basic box. Incentives that are most important are those that add project area, parking share plans, impact fees, and phasing. Planning Board Minutes May 24, 2017 Page 5 What incentives are used for both positive and negative outcome in Edmonds and regional regarding locally required design standards? The City's bonus point incentive program is great. It is straightforward and very easy to understand. It's easy to see the benefits to the community and the developer. The City's active planning staff is the most helpful he has worked with. They provide helpful guidance for the submittal work that is required by code. The park sharing the City allows is great and he appreciates that the City's codes are flexible. Many times, the intent of both the developer and the City is the same, but it requires a different way to get there. The design review process is excellent, and the planning recap done by the planner was great to set the table for the ADB's review. On the other hand, there are always challenges of being the first, and it always comes during the decision -making process. Hopefully, their project will set a precedence so the process can move faster in the future. Lastly, he said it is important to have a connection between the code language and available products and the efficiency of energy consumption. The City should trust the architects to know exactly where things are trending and what products use less energy, and the City's code needs to adapt to the trends. For example, if the code were to allow a few extra inches in height for an elevator, it would open a project up to a variety of other options that are more energy efficient. Mr. Chave commented that upon further review, the City's code regarding elevators may be more flexible than thought. However, he agreed that this particular code section, as well as others, are dated. Mr. Strazzara summarized that, for the most part, the City is right on. The openness of staff, creativeness of staff, and bonus program are great. The City is forward thinking and appears to be amenable to future changes. Mr. Strazzara summarized that times are changing and connectivity is becoming more and more important. There is a need for smaller units in places that are close to amenities and affordable. They know what the rental cost must be based on the cost to build. If they reduce the size of the units, they also reduce the cost. There is a need to live big in a smaller space such as providing a washer/dryer and providing amenity spaces in the buildings for connections. Even though the units will be small, the proposed project at Westgate provides a spa, rooftop garden, gym, terraced balconies and other communal space. The trend is that people prefer this type of development. Mr. Strazzara said his parents moved from their home in Magnolia to an assisted living unit in Magnolia because they didn't want to leave their neighborhood. This same opportunity exists in Edmonds, and he anticipates that there will be older people living in the Westgate project. Board Member Robles agreed and said this is just one option the City could encourage to allow people to "age in place." Other options include accessory dwelling units, Airbnb, renting out a room in their home, etc. Mr. Strazzara agreed this is very important and the Westgate project will be fully accessible throughout. Board Member Lovell asked how the City could avoid development that is basically five stories of sticks on a concrete podium. Mr. Strazzara said his opinion is that more specific regulations would be the wrong way to go. If they want to build a "ship box" they will find a way to do it no matter how strict the regulations are. The best approach is to provide incentives, which encourage buy -in from the design team and provide benefits to both the City and the developer. Strict regulations end up with dead pockets in the City that never develop or developers who learn to work around the regulations. Mr. Strazzara summarized that history makes Edmonds a bedroom community that supports Seattle, but it is also an urban area with its own identity. The proposed development at Westgate is very urban for the context of Edmonds. READING/APPROVAL OF MINUTES BOARD MEMBER CHEUNG MOVED THAT THE MINUTES OF MAY 10, 2017 BE APPROVED AS SUBMITTED. VICE CHAIR MONROE SECONDED THE MOTION, WHICH CARRIED UNANIMOUSLY. REVIEW OF EXTENDED AGENDA Chair Rubenkonig reported that she had a discussion with the Development Services Director regarding the Housing Strategy and learned that the City is still working with the Alliance for Housing Affordability (AHA) to establish the scope of work before hiring a consultant for the project. The Board's work on the Housing Strategy will not resume until the consultant's report is available for their review. Planning Board Minutes May 24, 2017 Page 6 Regarding the Five Corners Subarea Plan, Chair Rubenkonig announced that it has been decided that the previous work could be strengthened by hiring a consultant to do a feasibility study. However, this study has not been done to date. The Board will remain in a holding position until the study has been completed. Mr. Chave said, given the amount of time taken up with the Shoreline Master Program and Highway 99, the staff s plates are full. In addition, it is a benefit to be slower with Five Corners as they wait to see lessons learned from the Westgate project. Board Member Robles asked if it would be beneficial for the Board to review the Five Corners work before it is sent to the consultant for a feasibility study. That would allow the Board to better respond to the consultant's ideas. Perhaps the Board could provide input into the consultant's scope of work. Mr. Chave said the consultant would be reviewing market factors and identifying what is needed for development to move forward. He noted that a consultant has not been hired yet. Mr. Chave reported that a consultant has been hired to complete the Urban Forest Management Plan, and they have met with the Tree Board and had some stakeholder interviews. PLANNING BOARD CHAIR COMMENTS Chair Rubenkonig advised that she and Vice Chair Monroe need to prepare a report to the City Council regarding the Planning Board's recent work. She would like to include information about the status of the Five Corners Subarea Plan and Housing Strategy. The report to Council is scheduled for a meeting in June. Mr. Chave suggested they work with Ms. Hope to prepare the report. Chair Rubenkonig said she found tonight's discussion helpful. She was very pleased with the positive comments that were made regarding the City's forward -thinking approaches. PLANNING BOARD MEMBER COMMENTS Vice Chair Monroe reported on his attendance at the May 17th Economic Development Commission meeting, where they discussed three new focuses: affordable housing, development of the arts and civil assets. They are interested in relocating some of the City's administrative offices from City Hall to make room for a hotel. Board Member Lovell said it is important for the Board Members to be aware that light rail is coming to the region, and property values in the areas with stations are going up. A few years ago, the oversight panel made a strong recommendation to Sound Transit that they needed to be a little more take charge when it comes to transit -oriented development because the law requires that excess lands used for staging and storage during construction are to be sold at market rate once the project has been completed. He noted that the Roosevelt Station area is literally becoming a City of high-rise buildings and property values are increasing. Single-family residents are being pushed out, and buildings are going higher and higher. Although Highway 99 will not have light rail, he wonders if the Herbart Company has paid attention to opportunities in Mountlake Terrace, which markets itself as the closest bedroom community to Seattle on the north side. Lovell said he has some angst towards Highway 99 in terms of what can and will happen, and he pointed out that the new Animal Cancer Center at Five Corners was a huge investment and the site will not likely be redeveloped for quite some time. ADJOURNMENT The Board meeting was adjourned at 8:47 p.m. Planning Board Minutes May 24, 2017 Page 7