Alcyone

Seattle, Washington

Project Type: Residential

Case No: C036007

Year: 2006

SUMMARY The first market-rate housing project in the city of to be certified through the U.S. Green Building Council’s Leadership in Environment and Energy Design (LEED) program, Alcyone is a 161-unit, seven-story apartment building located in the redeveloping South Lake Union neighborhood. Covering nearly half a block, the structure comprises a mix of loft apartments, studios, and one- and two-bedroom units. Alcyone was designed to conserve water in excess of code requirements by 25 percent, and to use 30 percent less energy than code-based standards for the equivalent of about $40,000 in yearly savings throughout the complex. In addition, 95 percent of the construction waste was diverted from landfills.

FEATURES

LEED Certified Green Building Urban Revitalization Alcyone

Seattle, Washington

Project Type: Residential

Subcategory: Housing–Multifamily

Volume 36 Number 07

April–June 2006

Case Number: C036007

PROJECT TYPE

The first market-rate housing project in the city of Seattle to be certified through the U.S. Green Building Council’s Leadership in Environment and Energy Design (LEED) program, Alcyone is a 161-unit, seven-story apartment building located in the redeveloping South Lake Union neighborhood. Covering nearly half a block, the structure comprises a mix of loft apartments, studios, and one- and two-bedroom units. Alcyone was designed to conserve water in excess of code requirements by 25 percent, and to use 30 percent less energy than code-based standards for the equivalent of about $40,000 in yearly savings throughout the complex. In addition, 95 percent of the construction waste was diverted from landfills.

LOCATION Other Central City

SITE SIZE 0.8 acre/0.32 hectare

LAND USES Market-Rate Housing, Loft Housing, Multifamily Rental Housing, Restaurant, Public Rooftop Gardens

KEYWORDS/SPECIAL FEATURES

LEED Certified Green Building Urban Revitalization

WEB SITE www.alcyoneapartments.com

DEVELOPERS

Vulcan Real Estate 505 Fifth Avenue South, Suite 900 Seattle, Washington 98104 206-342-2348 www.vulcanrealestate.com

Harbor Properties, Inc. 500 Union Street, Suite 200 Seattle, Washington 98101 206-623-0916 Fax: 206-623-8232 www.harborproperties.com

ARCHITECT

GGLO 1301 First Avenue, Suite 300 Seattle, Washington 98101 206-467-5828 Fax: 206-467-0627 www.gglo.com

LANDSCAPE ARCHITECT Hewitt Architects 119 Pine Street, Suite 400 Seattle, Washington 98101 206-624-8154 Fax: 206-626-0541 www.hewittarchitects.com GENERAL DESCRIPTION

The first market-rate housing project in the city of Seattle to be certified through the U.S. Green Building Council’s Leadership in Environment and Energy Design (LEED) program, Alcyone is a 161-unit, seven-story apartment building composed of lofts, studios, and one- and two-bedroom units. Developed by Vulcan Inc. and Harbor Properties, Inc., the project was conceived and designed to enliven the center of the Cascade neighborhood in the emerging South Lake Union district.

With individual ground-floor street entrances and a prominent restaurant/pub on the corner, Alcyone activates an intersection next to block-sized Cascade Park and its popular “P-patches” (community gardens). The $25 million project is intended to be an environmentally responsible and healthy alternative for Seattle renters, with features that are replicable throughout South Lake Union and beyond.

THE SITE

A street plaque in the sidewalk in front of Alcyone marks the geographic center of the city of Seattle. Alcyone takes up three-quarters of a half block, stretching north from the intersection of Thomas Street and Minor Avenue, and bounded by an alley to the west. A small chrome-plating business and espresso bar occupy the remaining quarter of the half block. Cascade Park—the heart of the historic Cascade neighborhood—fills the entire block eastward across Minor Avenue, with P-patches and children’s play areas. The site was previously occupied by parking, offices, and two one-story houses.

The Cascade neighborhood lies at the eastern edge of South Lake Union, west of Interstate 5, and northeast of the central business district. Until the 1990s, parking lots for commuters and housing for low-income and special-needs populations were gradually replacing traditional light-industrial land uses there. Then Seattle-based REI, a supplier of specialty outdoor gear and clothing, built its new Seattle store, highly visible along I-5—joining major employers PEMCO Insurance and the Seattle Times in South Lake Union area.

Across the street from Alcyone is the mixed-use Alley 24 project. Developed by Vulcan and co-owned by PEMCO and Vulcan, it includes a completed, commercial LEED Silver-certified section that serves as the headquarters for international architecture firm NBBJ. Alley 24 also houses offices for international contractor Skanska and WPP Companies, which specializes in marketing and advertising. The project’s multifamily residential components are under construction as of April 2006.

DEVELOPMENT BACKGROUND

Both of Alcyone’s developers—Vulcan Real Estate and Harbor Properties—are long-term property owners that have reinvested in many of Seattle’s inner-city neighborhoods and downtown. Vulcan Real Estate is a division of Vulcan Inc., a project and investment management company founded in 1986 by Microsoft cofounder Paul G. Allen. Harbor Properties is a Seattle real estate firm founded in 1972 by local businessman Stimson Bullitt. Among the civic-scale projects in its portfolio is Harbor Steps, a landmark stepped open space connecting the waterfront area with the cultural centers on First Avenue. The development of Alcyone was led by Harbor Properties partner Denny Onslow along with staff members Martha Barkman, Megan Murphy, Alison Jeffries, and Charlie Laboda. The latter three have since joined Vulcan.

Vulcan purchased the land for Alcyone in 1999 as the company assembled over 60 acres (24.3 hectares) in and around South Lake Union, where it is actively promoting the creation of a mixed-use neighborhood. As Alcyone was in the planning stages, Harbor Properties and Vulcan were also in partnership for the development of a laboratory and office building for the Seattle Biomedical Research Institute, also located in South Lake Union. For the partners, the Alcyone site presented an opportunity to bring needed market-rate housing to the area. It also held the potential to set a standard for development in a rapidly changing neighborhood, with emphasis on environmentally sensitive, healthy living near .

By the time the site for Alcyone was purchased, the Cascade neighborhood had completed a community-based planning process to guide future development and shape a revised zoning code. The desire for more market-rate housing resulted in a land use designation unique to the neighborhood, “Seattle Cascade Mixed Residential,” which allows up to 55 feet (16.7 meters) in height for office buildings and up to 75 feet (22.8 meters) for residential structures. There is no requirement for ground-floor retail space as there are in similar Seattle zones. The planning process also resulted in relaxed parking requirements, stipulating only one stall per living unit.

Because of the master use permit conveyed along with the land purchase, the building permit for Alcyone did not require approvals of the city-sponsored neighborhood design review board. The development team, however, made a special effort to meet neighborhood priorities and field issues. Representatives attended regular neighborhood meetings to present ideas about the design of Alcyone and to listen to any emerging concerns.

The development team also accessed studies conducted by community design architect Michael Pyatok, who led a neighborhood planning process during the 1990s. These studies emphasized the activation of the alley through entries and other features, and also suggested the use of the quarter block as a basic unit of scale in redeveloping the neighborhood. Both of these became important elements in the design of Alcyone.

DESIGN

GGLO is a Seattle-based multidisciplinary design firm with a large portfolio of multifamily and mixed-use projects in urban infill sites and large new developments. The firm, which had worked with Harbor Properties on a number of multifamily projects, specializes in the integration of sustainable design and construction with pedestrian-oriented street features and art. Hewitt Architects, also a multidisciplinary firm, was responsible for landscape design.

Alcyone is designed to present a complex, multifaceted addition to the neighborhood. Courtyards, crenellations, setbacks, and material contrasts are intended to modulate the bulk and scale of the large building. Two landscaped entry courts along Minor Avenue break up the long dimension of the building. Although only one leads to the main lobby and common areas, each court has a large entrance door and lobby, entrances that activate the open space and help establish the perception that Alcyone is really multiple structures instead of one. That perception is reinforced through the contrasts in materials, forms, and detailing. A traditional masonry veneer and window details cover the south third of the building, industrial metal siding dominates the north end and the upper floors in the middle sections, and cement board clads the set-back upper three stories and center of the seven-story structure. The contrast is completed in the industrial modern character and corrugated metal finish of the blue-and-white north third of the building.

The courtyards help tie the building into Cascade Park, located across the street. The upper three floors of Alcyone are set back at a distance carefully calculated to preserve views of the and preclude casting shadows on the popular P-patch. All of these features satisfy neighborhood concerns about high walls and shadows, but they also respect the fine grain and variety of the neighborhood. In this sense, Alcyone is not an extension of downtown Seattle, but a close-in village alternative.

With doors, windows, and porches fronting two sides of its structure and along an alleyway for half of a city block, Alcyone is positioned to literally set the pace for the streets of this redeveloping neighborhood. A variety of loft and flat unit types open out directly to the street on three sides. The series of entrances on the alley are modern and industrial in character, with garage-door walls that can be opened out onto private decks. On the streets, some lofts open directly onto the sidewalk, and there is also a row of flats with doors atop traditional stoops. In these ways, Alcyone reflects traditional urban residential forms around the world. The overall variety of the entrances, combined with their arrangement in small, repetitive series, adds to the sense of multiple structures built at a quarter-block scale.

Anchoring Alcyone is the aforementioned restaurant/pub that sits at the intersection of Minor and Thomas, and extends the public realm of the street into the development. An outdoor seating deck, an open-air terrace, canopies, and lighting all combine to create an inviting and convivial corner.

Inside, Alcyone’s 161 units include a balance of 46 studios, 58 one-bedroom flats, and 17 lofts with mezzanines. The mix also features 32 two-bedroom apartments and nine one-bedroom apartments with den. Most have city views of downtown Seattle, the Space Needle, Lake Union, or the Olympic Mountains. The complex outer-wall configuration of the building means that many units have two outer sides yielding access to natural light. Angled bay windows on the alley side present lake views. Tall windows throughout most of the structure admit extra natural light. With the exception of the street-level lofts, all units are accessed through double-loaded corridors with entrances distinguished by color and lighting.

A rooftop terrace offers alternative open space for tenants only, and deep planters hold 20 P-patches for residents, served by rainwater captured in barrels from the higher rooftops.

To help advance the goals adopted by the larger neighborhood while enhancing the immediate environment, Vulcan and Harbor Properties partnered with corporate neighbor PEMCO to invest $650,000 in Cascade Park. It was used to remove a forbidding concrete retaining wall at the street edge, build a naturalistic streambed on the slope, and add pathways and more lighting.

SUSTAINABLE FEATURES

The developers’ goals for sustainability were matched by the aspirations of the Cascade neighborhood, which made sustainable design and construction a high priority in its plan. As a challenge to themselves and to other private developers, the partners made the important decision to seek certification for sustainable construction through the LEED benchmarking program created by the U.S. Green Building Council.

To seek LEED certification, a project must first satisfy some minimum requirements, including erosion and sedimentation control, storage of recyclables, standard ventilation, minimized energy requirements, and no chlorofluorocarbon (CFC) use. Then, proponents must show special achievements in seven areas of sustainability, such as: site; water efficiency; energy and atmosphere; materials and resources; and indoor environmental quality.

Alcyone’s sustainability can be assessed based on several categories of sustainability, including the following:

Commute reduction. Alcyone integrates several strategies for decreasing residents’ dependence on automobiles. It is an easy walk to downtown Seattle. There are several bus routes in surrounding blocks. Secured bicycle storage exceeds code requirements. Recharging stations for electric vehicles are located throughout the parking garage. Special car-sharing parking stalls make it easier to forgo car ownership. Residents pay extra for parking. It is located two blocks from a streetcar line scheduled to start construction in 2006, which will connect riders to downtown Seattle and mass transit.

Water conservation. Water conservation is integrated with the entire open-space plan at Alcyone, which, as mentioned previously, exceeds code requirements by 25 percent. Potable water use for irrigation is reduced by 60 percent.

Drought-resistant plants are used in the common spaces and private terraces. Plants are irrigated with a high-efficiency drip system that will be decommissioned when they are established. Rainwater is captured for high-efficiency irrigation. A P-patch roof garden is irrigated by water diverted from the roof to rain barrels. Showers, kitchens, and lavatories use fixtures with flow restrictors to conserve water above code requirements. Parking spaces do not add to runoff because parking is located beneath the building.

Atmospheric impact. Several strategies decrease air pollution, greenhouse gases, and impacts on the immediate environment.

A reflective roof will reduce the heat island effect generated by the buildings. Exterior shielded lighting will minimize night sky “pollution.” No CFCs were used in the mechanical, fire suppression, or refrigeration systems.

Indoor environmental quality. Special measures were taken to protect indoor air and create a healthy environment inside Alcyone.

During construction, air quality was protected through a two-week flushout period. Low-VOC paint and carpet were used throughout. Chemical mixing rooms and copier rooms are isolated and ventilated. All rooms on the perimeter have natural ventilation and individual control of heat and light fixtures. Heating is zoned by room for better control. Fresh air is ducted into corridors, creating a higher pressure in the public areas than in individual units. Smoking is not allowed in the building.

Energy conservation. Alcyone was designed for energy use at a 30 percent reduction below code required standards, for an equivalent of about $40,000 in yearly savings over the entire complex. Conservation measures include the following:

Low U-value (coefficient of heat transfer unit) windows. Inch-and-a-half-thick rigid insulation in addition to standard cavity insulation. Air leakage control. Digital thermostats. Central gas-fired boiler for domestic hot water. High-efficiency lighting.

Material recycling. Choices of materials for Alcyone were made for maximal recycled content and minimal energy use.

More than 20 percent of materials were manufactured within a 500-mile (806-kilometer) radius of the site. Concrete is an admixture of 5 percent fly ash and traditional materials. Light-gauge steel framing has up to 60 percent recycled content.

The development team set a goal of recycling 80 percent of demolition and construction waste. In fact, 95 percent of the waste was diverted from landfills, based upon separation and weighing of waste at each stage of the project. Construction waste was reduced through the choice of prefabricated light-gauge steel framing instead of wood.

FINANCING, MARKETING, AND MANAGEMENT

Financing for Alcyone is conventional. Although the owners were fully capable of self-financing the project, conventional financing was seen as a way of imposing desirable economic discipline on the project. Equity of 30 percent is split equally between the two owner-developers, with an expected internal rate of return of about 18 percent. With standard fees and inspections, U.S. Bank provided construction financing of 70 percent, with variable interest rates based on the London Interbank Offered Rate (LIBOR).

When the Alcyone apartments were offered for lease in April 2004, a month prior to project completion. The Seattle economy had not fully rebounded from the technology bust of 2001, and units were not fully leased until early 2005.

The project’s Web site, signage, and invitational events such as the “Bite of South Lake Union” held in the common rooms on the premises all generated interest. Outreach to nearby employers and local media coverage on sustainability features also brought traffic into the rental office. Advertising and marketing messages focused on healthy living, as well as on targeting people who enjoy the outdoors and prefer to live close to the city but not in it.

Leasing, in six-month and one-year terms, began with typical concessions like “free first month,” discounted parking, and early move-in. Within the first two years, net effective rent reached levels that support the pro forma returns for Alcyone. The units are priced for those making 80 to 120 percent of median income. Median income for a single-person household in Seattle at the time of opening was pegged at $45,000, and has since been updated to over $50,000.

Harbor Properties manages Alcyone through its real estate division, an arrangement that puts decision making into the framework of long-term investment in the property and the neighborhood. To extend the value of sustainable construction and healthy living at Alcyone, maintenance crews and tenants are educated about common household products that can introduce pollutants into indoor air and harm low-VOC finishes. Harbor Properties includes information on green cleaning products and local vendors in welcome baskets for new tenants.

Renters typically are young singles and couples. With a resident dog in the leasing office and a tolerant policy toward pets, Alcyone has attracted many dog-owner tenants. The first to rent were typically from other inner-city neighborhoods in Seattle. Occupancy plateaued at 92 to 93 percent in early 2005, settling at around 95 percent late in the year.

EXPERIENCE GAINED

Investments in sustainability at Alcyone have met several goals.

Alcyone has proven that incentives to reduce automobile use among market-rate renters can work. In a city with more cars than residents, 30 percent of Alcyone residents do not own one. P-patches have an important place in renter priorities. Within five months of the start of leasing, there was a long waiting list for the 20 rooftop P-patches at Alcyone. Thanks to the Built Smart program of Seattle City Light, which granted Alcyone a cash incentive of $95,000 for energy-efficient building envelope improvements over code requirements, investments in LEED-driven energy-efficiency measures were repaid within the first year of occupancy. Energy efficiency and low heating bills continue to draw tenants and lower the net cost of housing for them.

Following the first year of full occupancy, which ended in December, architect GGLO is compiling data about energy and water use at Alcyone. The data will be used to make better predictions about the performance of water- and energy-saving features. The architect estimates that LEED certification for the project involved “soft” (design, administration, and application) costs of $30,000. “Hard” costs were simply integrated into the overall project budget.

Alcyone has succeeded in connecting its residents with the neighborhood. Because of its proximity to the park, residents participate in seasonal events and activities there. With the project’s many street entrances, they can be seen coming and going over the course of the day. Entrances are customized with flowerpots and other personal touches, using beds and small wells of recycled glass aggregate.

The alley loft units with garage doors, originally perceived as a risky experiment, have been in high demand. Vulcan is repeating the choice to place lofts at ground level along an alley at Alley 24, another multifamily project the company is developing in the Cascade neighborhood.

As mentioned above, a welcoming policy toward pets has attracted a large number of dog owners to Alcyone. One result of this policy is a resident population on the street, as dogs promote interaction among residents and neighbors as well as increase pedestrian activity around the building and adjacent blocks.

With neighborhood compatibility and environmental responsibility among the highest priorities for Alcyone, the project yielded some design and construction lessons:

Garage doors, though popular, became a problem on summer nights when ventilation was needed but the doors could not be left open for security reasons. In response, the garage doors have been retrofitted with operable panels. Heat gain is a problem on summer afternoons on the western side of the building. Under these conditions, more shading features are called for. For the developers, Alcyone was a testing ground for light-gauge steel construction. It soon became clear that rigid insulation on the exterior makes it difficult to install cladding. In subsequent projects, insulation has been blown into the stud cavity. Preleasing, which began a month before Alcyone was complete, was not successful. In addition to the fact that the local economy was still rebounding from the tech sector bust of 2001, this was most likely because in the redeveloping location, potential renters needed the assurance of the completed lobby, landscaping, and finishes in order to commit to a move. Leasing began in earnest only after all of these were in place.

Tenants are attracted to Alcyone because of a rising level of concern about living and commuting choices and concurrent impacts on the environment. The project’s many sustainable features have proven to be a strong selling point to potential renters, but only as an added incentive after other amenities such as spacious rooms, views, large storage areas, and convenient location are considered. The tenant population is now beginning to recognize the significance of the LEED certification plaque framed in the Alcyone lobby, and the many design decisions that support it. PROJECT DATA LAND USE INFORMATION Site area (acres/hectares): 0.8/0.32 Gross density (units per acre/hectare): 196/484 Number of off-street parking spaces: 164

LAND USE PLAN Area (Square Feet/Square Use Meters) Percentage of Site Buildings 36,000/3,345 100

RESIDENTIAL INFORMATION Area (Square Feet/Square Rental Unit Type Number of Units Meters) Prices Studio 46 551/51 $927 Loft 17 847/77 $1,457 One-bedroom/one-bathroom 58 722/67 $1,276 One-bedroom, plus den 9 893/83 $1,493 Two-bedroom/two-bathroom 3 881/82 $1,642 Two-bedroom/1.75-bathroom 16 946/88 $1,642 Two-bedroom/two-bathroom 13 962/89 $1,765 Occupancy rate as of December 2005: 95 percent.

DEVELOPMENT COST INFORMATION Site Acquisition Cost: $3,600,000

Site Improvement and Construction Costs: $14,308,611

Soft Costs: $7,259,356 Architecture/engineering: $1,437,413 Project management: $911,230 Marketing: $419,809 Legal/accounting/taxes/insurance/title fees/other: $1,990,022 Construction interest and fees: $1,475,831 Contingency: $925,051 Retail tenant improvements: $100,000

Total Development Cost: $25,167,967

DEVELOPMENT SCHEDULE Site purchased: May 1999 Planning started: July 2000 Partnership between Harbor Properties and Vulcan Real Estate formed: October 2002 Construction started: January 2003 Leasing started: April 2004 Project completed: May 2004

DRIVING DIRECTIONS

From Seattle-Tacoma International Airport: Merge onto WA-518 heading east for about three miles (4.8 kilometers), then take a left onto Interstate 5 going north toward Seattle. Stay on Interstate 5 for almost 12 miles (19 kilometers), then take the Olive Way exit (exit 166). Take a slight right onto Olive Way and then take a left on Denny Way and cross over Interstate 5. After driving three blocks, turn right on Minor Avenue. Stay on Minor for two additional blocks until you reach Thomas Street. Alcyone is at the corner of Thomas Street and Minor Avenue and across the street from Cascade Park.

Driving time: Approximately 20 minutes in nonpeak traffic.

Clair Enlow, report author Jason Scully, editor, Development Case Studies David James Rose, copy editor Joanne Nanez, online production manager

This Development Case Study is intended as a resource for subscribers in improving the quality of future projects. Data contained herein were made available by the project's development team and constitute a report on, not an endorsement of, the project by ULI–the Urban Land Institute.

Copyright © 2006 by ULI–the Urban Land Institute 1025 Thomas Jefferson Street, N.W., Suite 500 West, Washington D.C. 20007-5201 Alcyone is the first market-rate housing project in the city of Seattle to be certified through the U.S. Green Building Council?s Leadership in Environmental and Energy Design (LEED) program. The 161-unit, seven-story apartment building consists of 46 studios, 17 lofts with mezzanines, 32 two-bedroom units, 58 one-bedroom units, and nine additional one-bedroom units with dens. Alcyone is part of a larger project led by Microsoft cofounder paul G. Allen?s Vulcan Inc. to transform the South Lake Union area just north of downtown into a mixed-use biotech center. Across the street from one of the city?s ?p-patches? (community gardens) sits a restaurant/pub—Alcyone?s sole tenant?that was placed there with the intention of enliving the corner with its open-air terrace, canopies, and lighting. With the use of garage-door walls, some of the lofts open directly out on the street. Alcyone was designed to conserve water in excess of code requirements by 25 percent and to use 30 percent less energy than code-based standards, generating the equivalent of about $40,000 in yearly savings throughout the complex. In addition, 20 p-patches sit on the project?s roof. Alcyone site plan. Alcyone elevation. Alcyone floor plan.