by Ted S. McGregor Jr
Usually you have to drive out of town a while to get to the wide-open spaces, but not so in downtown Spokane. If you wander down to Spokane Falls Boulevard, you'll find nearly three city blocks sitting empty. Yes, just across the street from the Opera House and running all the way along Riverfront Park, only a single building interrupts this pristine stretch of urban vacancy.
"In New York City, that's prime property," says Mike Edwards, president of the Downtown Spokane Partnership. "Here, it's like it doesn't exist. It's crazy."
While Donald Trump uses the property across from Central Park to create his latest high-rent destination, in Spokane such property is considered convenient for parking.
"That's the best site in the city," says one developer of the westernmost of the three blocks, who thinks a higher-end condo project could do very well there.
Larry Soehren, a downtown commercial real estate broker and property manager, says that when he looks down Spokane Falls Boulevard today, he thinks about what has happened in San Diego in recent years.
"Not that long ago, when you looked down the street from the San Diego [convention] center, it was all parking lots," says Soehren. "Now you've got the convention center on one side of the boulevard, looking out on the water, and across the street, now it's housing, retail. It just draws you in."
"Sooner rather than later, Spokane Falls Boulevard will be the nicest street, the focal point, the highest rent and the best pedestrian access," predicts architect Glen Cloninger, who has a stake in the block across from the Opera House. "But maybe it's not ready to happen yet."
Like a Butterfly
Surface-level parking lots might look like land of opportunity to a real estate developer, but in Spokane these canvases have been left blank for decades. When people emerge from a symphony concert at the Opera House, they probably don't think about what the parking lot across the street could become: no, it's a harsh reminder that in significant ways, downtown Spokane is a glass half empty.
Depending on your point of view, surface-level parking lots are a blight or a boon, but really they're just a natural phase in the evolution of any urban landscape. It's a sad fact, but buildings don't last forever. In Spokane's case, many of the city's oldest buildings were located on what is now Spokane Falls Boulevard. The old Coeur d'Alene Hotel -- which now houses O'Doherty's and Boo Radley's and is at the west end of the open stretch -- is an example of a building sturdy enough to survive.
The now nearly demolished Fort Spokane Brewery building is another example of another survivor; even though it is being taken down, it lived a lot longer than many of the buildings that once fronted the street.
Cloninger says it's a bit like the life of a butterfly: The old building is the caterpillar; the vacant lot is the cocoon; and the building that eventually is built on the site is the butterfly. In an active real estate market, the cocoon phase may only last five years or less. In Spokane, it's been 30 years or more for some of these parcels.
The recent history of downtown Spokane has a lot to do with what may or may not happen to the sites. Back in the mid-1990s, as the Spokane Valley Mall opened and NorthTown expanded, downtown Spokane reached a crossroads. Would it be an office-only environment, devoid of retail and entertainment uses? Or would it somehow keep all the elements together and survive -- or even thrive? At that crucial moment, downtown did not go out of business (though the struggle continues). Instead, projects like the Davenport Hotel, River Park Square, the convention center expansion, the Big Easy and various other smaller projects have added up to a solution.
Still, the local economy has struggled along with the nation's, and growth here is unremarkable. There's a lot of optimism about downtown, but the proof will come when projects are planned or built: Will banks loan money to fund them? Will people and businesses support them?
While you're thinking about that, think about this: Another caterpillar is about to enter its cocoon stage. It's on the site of the old Rookery Block at Riverside and Howard.
Is Vacant Better?
What's happening with the Rookery Block is a case study in the hurdles downtown developers and property owners face. The owner of the buildings in question, Wendell Reugh, has said that unless a buyer emerges for his property, he'll tear it down and turn it into another surface-level parking lot. It sounds like a heartless thing to do, since everybody knows saving classic old buildings is a public good. But if you challenge that conventional wisdom for a moment -- as some downtowners do privately -- the decision is not so black and white.
The facts are that the separate buildings that make up the block are a mixed bag. One is historically and architecturally significant; another is literally falling apart. A renovation -- as developer Ron Wells has shown some interest in for the block -- would be much more expensive than new construction on the same site. If Wells could save the block, he'd then be faced with finding tenants willing to pay a premium for the spaces.
"I care about old buildings -- the quality -- and new [construction] doesn't always have it," says Cloninger, "but customers won't always pay extra."
With buildings falling into disrepair, it gets harder and harder for property owners even to find a company that will insure them. Even the relatively modest income a parking operation can bring is a lot better than getting zero income from an empty building. And property taxes are much lower for a vacant lot than for a building of any kind. So there comes a point where the market -- through insurance, income streams and property taxes -- practically forces a building to come down.
"At some point," says Soehren, "you have to decide what's worse -- an empty building or a parking lot?"
Architect Cloninger says this is where public policy could come to the rescue. He says if the region is serious about protecting older properties, Spokane County should allow property tax abatements for buildings not in use. Policy makers could also develop some kind of local insurance assistance program for older buildings.
But Cloninger is also realistic about the fates of such properties. Even though Ron Wells has proven at the Steam Plant that old and decrepit can become spectacular, most developers want to build from the ground up. In other words, most developers would prefer to start with a vacant lot.
Another complicating factor is price. Every owner of any kind of property hopes it fetches top dollar when the time comes to sell. Reugh's price tag on the property is roughly double what buyers have offered. When a buyer and a seller cannot agree on terms, nothing happens -- which may explain the seemingly permanent state of vacancy on other downtown parcels.
There's another path, but it would require a more activist local government. If a public purpose is cited -- say, preserving the city's architectural heritage or eliminating blight -- the city can force the property owner to sell. Under the legal proceeding of eminent domain, the city would get appraisals and pay what is agreed upon as fair market value. This approach conjures up all kinds of unintended consequences, however, as the city would be viewed as treading on people's property rights and as it would require the city to go into the real estate business. (The plan would be for the city to turn around and sell the Rookery Block to a private developer.)
So as the case of the Rookery Block shows, there are times when surface-level parking lots seem inevitable. (Hope is not lost, however, since Reugh has been granted an extension on his demolition permit, which buys more time for a solution to be worked out.)
The big question for downtown Spokane is how to make that surface-level parking lot a genuinely transitional use rather than a long-term solution.
What's the Holdup?
One of the biggest problems with these sites seems to be that developers can't get ahold of them. Sometimes the owners won't sell; other times there are so many owners that it makes any deal more complicated.
In the case of the block across from the Opera House, there are several owners, but one use is certain: more parking for the convention center. The Public Facilities District, which has already budgeted money for property acquisition, expects to need parking by 2007. (See "The New Kid on the Block," starting on page 19.) The PFD is viewed as a good landlord or partner because over time it should have plenty of money to complete the projects it needs. Parking could be developed to meet the needs of the entire neighborhood.
"Centralized parking can increase the likelihood of development," says Edwards of the DSP.
But who would partner with the PFD on parking? The answer will probably make some people spit up their coffee when they read it, but it's the city of Spokane. The whisperings are starting to become audible: Downtown developers think the city of Spokane will have to get involved in parking again, despite its bad experiences at River Park Square.
"We have a parking crunch looming out there," says Soehren. "Parking is infrastructure, much like power, water and sewer."
Such a crunch would be made even worse if some of these surface-level lots are redeveloped for a better use. One rule of thumb even says you really need one extra lot per downtown development just for the parking. But shared parking structures overseen by a public entity can solve the needs of an entire area, freeing every developer from having to build a separate parking structure. It may be that a discussion about public parking facilities is a long way off, but developers say it remains one of the few methods for prompting new construction.
The DSP is pushing for one owner on the block across from the Opera House so that a master plan can be created -- and so an entity will exist that can say yes or no to specific proposals. Without a single owner, development gets even more difficult. That's the case on the old Fort Spokane Brewery block. Now only occupied by Auntie's (which owns its building and land) and a vacant restaurant, the property is a patchwork of parcels owned by Spokane resident John Hieber and the Pacific Operating Company of Houston, Texas.
But single ownership is no guarantee that a deal will happen, either. The parcel adjacent to O'Doherty's and Cyrus O'Leary's is owned outright by Hieber -- but he's in no hurry to sell.
"I'm a great supporter of downtown, and I'm hoping that the new developments are going to be successful, but it's a little early yet to tell," says Hieber, who has owned the property for 25 years. "We don't need to sell it. If the timing was right, we could do [a project] ourselves."
That parcel has been identified in the downtown plan as a prime location for condos, and at least one developer has been looking into the possibility. A recent DSP study concluded that downtown Spokane could support as many as 400 units of housing.
But housing has been an elusive target. There have been a lot of successful five-unit loft renovation projects, but there has not been a new construction project with, say, 50 units. Most think that when that first project goes up, it will be a gut check: If they sell or rent out fast, Spokane will pass the test. Lenders will jump on the bandwagon, developers will get interested and downtown will become a place more people call home.
That first project is a big risk, and that's why it's been so difficult. Jeff Warner, an architect who has worked up plans for the block for ALSC, looks out his office window at the possibilities every day. There are a million reasons not to do anything, he says, so "a project like this needs to get a backer who will push it past all the hurdles."
Perhaps with a new parking garage next door, with retail on the main floor and with views of the park, such a project might just get enough of a nudge to actually happen. So live it up while you still can: For now, at least, you're living in a parker's paradise.
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Publication date: 06/17/04