East C rrid r Implementati n Support
130th Avenue NE Transit-Oriented Development Opportunity Study and Financial Assessment
PHASE 2 REPORT
DECEMBER 2013
Otak, Inc. In association with: BAE Urban Economics and Nelson\Nygaard Consulting Associates Puttman Infrastructure GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support | DECEMBER 2013
The Growing Transit Communities Partnership is funded by the Sustainable Communities Regional Planning Grant Program of the U.S. Department of Housing and Urban Development. The work that provided the basis for this publication was supported by funding under an award with the U.S. Department of Housing and Urban Development. The substance and findings of the work are dedicated to the public. The author and publisher are solely responsible for the accuracy of the statements and interpretations contained in this publication. Such interpretations do not necessarily reflect the views of the Government.
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support | DECEMBER 2013
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Project Management Team of the East Corridor Task Force The following members of the East Corridor Task Force are serving on the Project Management Team for the East Corridor Implementation Support Project:
Wes Edwards – King County Tom Hinman – Redmond Community Representative Emil King – City of Bellevue Doug Mathews – Bellevue Community Representative Lori Peckol – City of Redmond Tracy Reich – Impact Capital Kelly Rider – Housing Development Consortium Seattle-King County Arthur Sullivan – A Regional Coalition for Housing (ARCH)
Alternates: Paul Inghram – City of Bellevue Sarah Stiteler – City of Redmond
Puget Sound Regional Council, Growing Transit Communities Partnership Ben Bakkenta, Program Manager Mary Pat Lawlor, Program Manager Cameron Duncan, Planning Technician
Consultants Otak, Inc.—Prime Mandi Roberts, Project Manager Kurt Creager Tom Litster Jenny Ngo
BAE Urban Economics, Inc. Janet Smith-Heimer and Paul Peninger
Nelson\Nygaard Consulting Associates Kevin Shively and Tim Payne
Puttman Infrastructure, Inc. Thomas J. Puttman
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support | DECEMBER 2013
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Preface The Regional Vision ...... 1
Summary of the Growing Transit Communities Partnership ...... 1
Three Corridors/Three Task Forces ...... 2
East Corridor Context ...... 2
Four Focus Areas for East Corridor Implementation Activities ...... 3
East Corridor Project Purpose and Overview ...... 3
Implementation Support Project Guidance and Timeline ...... 3
Overview of Phases 1 and 2 ...... 3
Phase 2 Products ...... 4
The Focus of this Phase 2 Report: 130th Avenue NE Transit-Oriented Development Opportunity Study and Financial Assessment Background and Introduction ...... 6
Study Site Context ...... 6
Study Process & Partners ...... 8
Study Objectives ...... 9
Summary of the TOD Opportunity Study Findings ...... 10
Next Steps ...... 11
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support | DECEMBER 2013
Description of Conceptual TOD Scenarios Studied ...... 11
Key Assumptions of Analysis ...... 14
Financial Feasibility Analysis ...... 16
Conclusions and Recommendations ...... 20
Ridership Calculations ...... 24
Appendix Pro Forma Sheets
Conceptual Plans and Sketch-Up Models
Comment Letter from Sound Transit
Comment Letter from the City of Bellevue
(Please note that the comments in these letters have been addressed in this final report.)
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
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to help make the most of this investment by locating housing, jobs, and services close enough to Preface transit so that it is a viable option for many people. If done right, more people will have a faster and THE REGIONAL VISION more convenient way to travel.
VISION 2040 is the central Puget Sound region’s The Partnership was formed through a coalition of long-range vision for maintaining a healthy region city and county governments, housing authorities and is a guiding premise for all regional planning and affordable housing interests, transit agencies, and implementation. VISION 2040’s cornerstone is public health agencies and departments, real estate its emphasis on development of vibrant, mixed-use and development interests, social justice and centers where people can live, work, and play. community development groups, economic Integrating affordable housing in mixed-use centers development and business interests, community throughout the region contributes to achieving a based organizations, educational interests, jobs-housing balance that increases access to environmental advocacy groups, and the public. opportunity, lowers households’ combined cost of This coalition of the Partnership has been housing and transportation, and helps ensure that supporting neighborhood planning for more infrastructure investments enhance equity across connected, livable, and sustainable communities the region. around more than 74 high-capacity transit centers in the region—covering three counties in sixteen cities—including existing, new, and future station SUMMARY OF THE GROWING areas. TRANSIT COMMUNITIES Through these efforts, the Partnership has been PARTNERSHIP working to shape the region and station areas in In keeping with the regional vision described above, ways that benefit current and future residents, local the central Puget Sound region is investing more businesses, and the wider region. Working within than $25 billion dollars in high-capacity transit over the framework of existing plans, policies, and goals the next twenty years, providing a once-in-a lifetime of local governments and guided by VISION 2040, opportunity to capitalize on these investments by the Partnership has been helping local communities growing and strengthening communities around bring their visions to reality and to make the most stations. The Growing Transit Communities of new light rail service, bus rapid transit, and other Partnership (Partnership), funded by a grant from transit investments, including identifying unique the US Department of Housing and Urban roles and opportunities for community Development’s Sustainable Communities Regional development associated with high-capacity transit Planning Grant Program and administered by Puget investments. For more information about the Sound Regional Council (PSRC), has been designed
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
Growing Transit Communities Partnership and completed extensive planning for the station areas PSRC, visit www.psrc.org. in their jurisdictions, so the Task Force decided to focus on stations in Bellevue and Redmond
THREE CORRIDORS/THREE TASK Staff from the cities of Bellevue and Redmond FORCES indicated that the station areas in the Bel-Red Planning activities of the Partnership have focused Corridor and Overlake were in most need of along the three light rail corridors from Seattle implementation support. Given these north to the city of Everett, south to Tacoma, and considerations, the Task Force determined that the east to the city of Redmond. Based on the premise East Corridor Implementation Support Project that change can happen at the local level through should focus on the following subset of East tools and solutions that address similar challenges Corridor station areas in the cities of Bellevue and 2 shared by communities in the region, the Redmond, along East Link and King County Partnership has provided a big-picture perspective Metro’s RapidRide Route B stations: so that people can see both local and regional benefits, and local entities can apply lessons East Link Light Rail Station Areas (Future) learned in other places in the region. Corridor task Selected for the East Corridor forces for the North, East, and South corridors were charged with analyzing and reviewing existing Implementation Support Project: conditions and identifying unique opportunities and • Hospital Station Area in Bellevue challenges for development of existing and future • 120th Avenue NE/Spring District Station transit station areas. Area in Bellevue • 130th Avenue NE Station Area in Bellevue In development of its work plan and specific • Overlake Village Station Area in Redmond assignments for each task force, the Partnership felt • Overlake Transit Center Station Area in that it was important to focus implementation Redmond activities in specific station areas of the region’s transit corridors to serve as models for other parts King County METRO RapidRide B Line of the region. In the case of the East Corridor, the intention was to work with the East Corridor Task Station areas (Existing) Selected for the Force to identify what catalyst project, or projects, East Corridor Implementation Support were most appropriate. This evolved into the Project: defined scope of work for the East Corridor Located in Bellevue’s Crossroads Neighborhood: Implementation Support Project. • NE 10th Street Station Area • NE 15th Street Station Area EAST CORRIDOR CONTEXT In 2011, the Sound Transit Board of Directors made The Partnership funded and guided the East its final decision about the East Link light rail transit Corridor Implementation Support Project to (LRT) corridor alignment and station locations. Also examine opportunities for TOD along Sound in 2011, King County Metro began operation of its Transit’s East Link Light Rail and King County Metro Bus Rapid Transit service (BRT) RapidRide line B. In RapidRide Line B alignments through the Eastside order to help areas around LRT and BRT stations cities of Bellevue and Redmond in these station transform into more transit-oriented communities, areas initially as part of Phase 1 of the project, and the four cities participating in the East Corridor Task then to provide more focused analysis and Force (Seattle, Mercer Island, Bellevue, and strategies for selected station areas as part of Phase Redmond) and other Task Force members were 2. Portions of the project area are located within interested in developing focused implementation the areas known as the Bel-Red Corridor and strategies and tools for specific East Corridor station Overlake. areas. Seattle and Mercer Island had already
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
FOUR FOCUS AREAS FOR EAST IMPLEMENTATION SUPPORT CORRIDOR IMPLEMENTATION PROJECT GUIDANCE AND TIMELINE All phases of the East Corridor Implementation ACTIVITIES Support Project have been informed by Through a series of meetings, the East Corridor Task representatives of the East Corridor Task Force. The Force examined key issues and identified barriers to Task Force identified a subset of members, called transit-oriented development in the East Corridor, the Project Management Team (PMT), to advance along with particular challenges to implementing the project and bring back matters to the Task equitable TOD in station areas. In its discussion of Force for direction and decisions. PMT members how to incent and accommodate equitable transit- were selected from the general membership of oriented development in station areas, the Task the Task Force (including representatives from 3 Force determined four areas of focus for the East the cities of Bellevue and Redmond) and Corridor Implementation Support project. The Task confirmed by the Task Force co-chairs. See the Force identified the need for detailed strategies and Acknowledgements page for PMT members. action steps to implement existing local plans, particularly in the areas of: Growing Transit Communities staff and the PMT • Affordable Housing members of the Task Force retained a consultant • Business Retention and Attraction team with expertise in affordable housing, urban • Public and Private Partnerships design, transportation planning and policy, real • Transportation Access and Connectivity estate and economic development, and other areas to assist in identifying actions and strategies to EAST CORRIDOR PROJECT address these issues and help to catalyze TOD.
PURPOSE AND OVERVIEW The East Corridor Implementation Support project OVERVIEW OF PHASES 1 AND 2 has identified pivotal opportunities to transform The scope of work for the East Corridor Eastside station areas into more vibrant, Implementation Support Project was completed in economically healthy neighborhoods that offer two phases. Phase 1 included best practices equitable housing choices, more convenient access research, a high level assessment of seven East to jobs and jobs-to-housing balance within the high- Corridor station areas, screening and selection of capacity transit corridors and region, and better station areas for further analysis in Phase 2, and connectivity to goods and services. development of the scope of work for Phase 2. See the Phase 1 Best Practices Research Report for a The project is supporting immediate advancement detailed description of initial tasks. Go to: of the implementation of visions and plans that http://www.psrc.org/about/pubs to download the have already been developed by participating report. jurisdictions on the Eastside, and the project team has leveraged other products developed by PSRC Phase 2 involved more intensive analysis and and the Growing Transit Communities Partnership, development of specific recommendations for TOD including affordable housing and opportunity implementation for two station areas: 130th mapping, existing conditions reports, market Avenue NE in Bellevue and Overlake Village in analyses, station area typologies, Center for Transit- Redmond. Phase 2 explored innovative approaches Oriented Development (CTOD) market strength to leverage opportunities and incent TOD index, and other information as a base of reference implementation in the short- and long-term in these for the project. station areas. Phase 2 developed recommended actions, strategies, and products to address specific issues in each station area per the scope of work that was developed by the Task Force and overseen by the PMT.
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
PHASE 2 PRODUCTS Products developed in Phase 2 supporting these four focus areas are listed in the chart below.
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These products have been completed as stand-alone, complementary documents and reports. All reports are available for download at http://www.psrc.org/about/pubs (look for Growing Transit Communities Partnership, East Corridor information).
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130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
The Focus of this Phase 2 Report: Avenue NE Station Area Plan, which further characterizes the desired vision for urban, mixed- use redevelopment around that station. 130th Avenue NE Integrating affordable housing options and Transit-Oriented attracting new businesses to support residents’ needs are encouraged by the Growing Transit Development Communities Partnership and the City’s adopted Opportunity Study and Financial plan. Transportation is the second largest Assessment household budget cost for families in the US, and locating affordable housing near light rail 6 The focus of this Phase 2 report of the East stations gives people the opportunity to use Corridor Implementation Support Project is the transit and lower their household costs. And 130th Avenue NE Transit-Oriented Development when housing, retail, services, and employment (TOD) Opportunity Study. This report provides a are located in close proximity, people can choose summary of the background, purpose, and results to walk, bicycle, and use transit more frequently, of the study. further reducing their transportation costs.
The information developed as part of this study Building partnerships to implement the best supported by the Growing Transit Communities solutions for TOD around light rail stations is Partnership can serve as a model and reference to another key objective of the Growing Transit other transit-oriented development studies for Communities Partnership. As demonstrated by station areas throughout the region. this opportunity study, the Partnership has been successful in pulling together multiple partners to BACKGROUND AND look at how to best leverage the regional investment in transit and foster TOD INTRODUCTION opportunities. The 130th Avenue NE TOD One of the key objectives of the Growing Transit Opportunity Study builds on the Partnership’s Communities Partnership is to make the most of objectives and the previous station area planning the regional investment in high-capacity transit by work completed by the City of Bellevue. locating housing, jobs, and services close enough to stations that using transit is a viable option for many people. STUDY SITE CONTEXT The study site is located between 130th Avenue NE Once completed, the City of Bellevue will have six and 132nd Avenue NE, immediately north of the light rail station areas, each with unique future alignment of NE 16th Street, where the light characteristics. The City has been focused on the rail line will operate. The northside platform of the potential for new TOD in the Bel-Red Corridor 130th Avenue NE light rail station will be th th (120 Avenue NE and 130 Avenue NE stations), constructed within the proposed NE 16th Street while other stations such as the South Bellevue right-of-way, which borders the south edge of the station are expected to experience little or no study site. change. The City has adopted a plan for the Bel- Red Corridor that calls for a mix of land uses, Refer to the maps of the 130th Avenue NE station including high density housing, retail, area on the next page. These maps were created employment, and public services surrounding the by the City of Bellevue’s team for the 130th th th 120 Avenue NE and 130 Avenue NE light rail Avenue NE Station Area Plan. stations. The City also has completed the 130th
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
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Maps of the 130th Avenue Station Area from the City of Bellevue 130th Avenue NE Station Area Plan.
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
The study site focused primarily on three parcels, What would success at the 130th Avenue NE TOD which are the same parcels being proposed for site look like to both Sound Transit and the City of development of a surface park-and-ride lot and Bellevue? bicycle parking facility, to be constructed by Sound Transit and open with the light rail station in 2023 Could a public/private partnership create an (see additional discussion later in this report). integrated TOD/park-and-ride that advances a These three parcels total approximately 4.04 acres: transit-supportive land use vision in lieu of a • Parcel 1—NW Parcel: 53,809 SF stand-alone surface parking? (And be implemented without requiring additional • Parcel 2—SW Parcel: 51,265 SF Sound Transit funding?) • 8 Parcel 3—SE Parcel: 70,819 SF Can the TOD solution be designed to meet A conceptual TOD plan for a fourth parcel (NE Sound Transit’s needs and to be consistent with Parcel where Goff Creek flows at the far City plans and how can this solution activate the eastern edge), also was developed, but this area, catalyze additional development around the 2.35 acre parcel was not included in the station, increase ridership, and create a safer, financial analysis. The team included more welcoming environment? conceptual analysis for the fourth parcel to test connectivity and open space relationships For part of the first workshop session, participants worked in study groups to evaluate potential with the other three parcels of the configurations of TOD for the study site. Group rectangular-shaped study area. representatives then summarized the
organizational concepts to the full group at the Refer to the maps and plans at the end of this end of the session. report, illustrating the site context and conceptual TOD scenarios. After the first workshop session, representatives from the consultant team (Otak, Inc., BAE Urban STUDY PROCESS & PARTNERS Economics, and Nelson\Nygaard Consulting The study process engaged representatives from Associations) further developed the TOD the City of Bellevue, Sound Transit, A Regional configurations discussed in the workshop into Coalition for Housing (ARCH), Puget Sound three distinct scenarios (see scenarios descriptions Regional Council, and other stakeholders through starting on page 11) and then conducted an initial a two-part workshop series. The workshop financial feasibility analysis, as well as an analysis process brought partners and stakeholders of potential ridership (see pages 24 and 25). together to explore ideas and concepts. These
ideas were then developed into specific TOD A second workshop session was held in early fall scenarios, and a financial model was developed to 2013, reconvening the original participants. The test feasibility of the scenarios as well as sub- conceptual scenarios and results of the financial alternatives that layered in housing affordability and ridership analyses were shared and discussed formulas and various other options. at the session. Several elements of the analysis
were identified as needing further refinement and The first workshop session, held in spring 2013, checking to ensure accurate calculations of focused on a discussion of project goals and vision development fees and right-of-way/land value and centered discussion on the questions: assumptions. The City of Bellevue and Sound
Transit provided comments via letters (included in
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
the Appendix) outlining areas that needed further sound solutions (that would keep Sound development and discussion in the report. The Transit financially “whole” without requiring consultant team addressed these comments more funding than already budgeted for the through revisions and refinements, which are 130th Avenue NE station). reflected in this final report. . Evidence of public and private investment potential/market for TOD STUDY OBJECTIVES Prior to the study process, representatives from City of Bellevue Objectives: Sound Transit and the City of Bellevue met to . Site development that furthers City’s identify key objectives. They then shared the adopted Bel-Red plan with housing and 9 following lists with the consultant team. redevelopment in the station area . High quality, market-ready, and functioning Sound Transit Objectives: TOD project is developed . Light rail station constructed and operating by . 300 stall park-and-ride is integrated into TOD 2023 without adding to cost of East Link and . 300 transit customer parking spaces available without delay to Sound Transit timetable at opening . TOD construction is closely coordinated with . Transit customer and station facilities are Sound Transit staging and construction accommodated (bicycle parking, ADA access, . Possibility of shared parking considered as utility access areas, etc.); part of site development/transit park-and-ride . Site provides construction staging/lay down area . Open to partnerships that provide for true sharing of risks and benefits and financially
Vision for 130th Avenue NE station area, from City of Bellevue Station Area Plan
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
What Would a Successful TOD Look compared to the surface parking solution. Key findings of the study include the following: Like? . . Park-and-ride would be served by a transit At this initial stage, it appears that there are forms of an integrated TOD/park-and-ride that garage or another type of integrated parking could work and meet Sound Transit and City solution as part of the TOD rather than a of Bellevue objectives. surface parking lot. . Development would be phased to allow for . Park-and-ride capacity of a minimum of 300 Sound Transit’s use of the site during cars, as well as space for bicycle parking can be accommodated in the integrated TOD construction. solution in accordance with Sound Transit’s . The TOD would provide a mix of housing 10 objectives. choices, including affordable housing. . . The TOD would result in ridership that A successful TOD solution can be implemented without increasing Sound supports and sustains the light rail system. Transit’s costs. . The TOD would create vibrant, urban neighborhood character with excellent . Implementation of a built-form TOD solution pedestrian and bicycle connectivity to the at the site would support Sound Transit’s station. adopted TOD policies, as well as adopted policies, plans, and zoning of the City of . The TOD would help to catalyze other future Bellevue. redevelopment in the station area. . Implementation of a built-form TOD solution will increase transit ridership over the long- term (see pages 24 and 25 for ridership SUMMARY OF THE TOD projections). OPPORTUNITY STUDY FINDINGS . th The 5 over 1 form of mixed-use construction The 130 Avenue NE TOD Opportunity Study holds the most promise in the redevelopment explored redevelopment scenarios that would scenarios studied (5/1 mixed-use buildings create a mixed-use TOD on the study site with an typically have up up to 6 levels , including a integrated park-and-ride facility (garage for transit ground floor level that may be retail or other riders). Scenarios were developed in accordance active uses and residential and employment with the City of Bellevue’s adopted plan, which uses in up to 5 levels above that); the reason calls for a built TOD solution at the site, and also this construction type makes the most sense were designed to integrate Sound Transit’s financially is that construction costs are high requirements to provide park-and-ride capacity for tower forms and townhome and similar for 300 cars and bicycle parking to be available to development types are not as efficient in land serve riders when light rail opens in 2023. use as 5/1 construction. The study assessed financial feasibility of three . Scenarios that incorporate housing potential redevelopment scenarios, as well as sub- affordability with relatively available forms of alternatives (including affordable housing as a assistance (e.g. tax credits, short term component of the TOD). The study also assessed property tax exemption) appear to be feasible potential light rail transit ridership that would or to even increase viability. occur through a built TOD solution compared to that generated by the surface parking lot. . In response to discussions at the second workshop series the consultant team The financial assessment confirmed that there are confirmed that the conceptual scenarios financially feasible opportunities to develop TOD generally meet the City’s adopted Bel-Red at the site and that these would result in more code requirements including provisions for sustainable transit ridership over the long term pervious coverage and active ground floor
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
uses. Additional refinement of a preferred District master plan at the 120thAvenue NE plan/scenario would fine tune these details station, and Capstone Partners, which has and maximize the application of incentives started construction at the former Group and bonuses allowed by code. Health hospital site in Overlake Village. . A TOD solution will activate the neighborhood and create an attractive, urban transit- NEXT STEPS oriented place to live, work, shop, and play th that also would help to catalyze adjacent The 130 Avenue NE TOD Opportunity Study sets development. a good foundation, but it is preliminary and more work needs to be done to further clarify the . Locating the parking in an adjacent structure challenges related to the site and to explore 11 provides Sound Transit and the TOD with increased flexibility during construction, giving development options in more detail. The Sound Transit greater use of the site for a preliminary results summarized in this report will longer period. help to support ongoing work and coordination between the City of Bellevue and Sound Transit. . There are challenges to site development This ongoing work should focus on defining related to timing and phasing during construction that will require additional work specific phasing and construction needs and coordination between partners. associated with the site, identifying a specific partnership mechanism for Sound Transit’s . While specific development interests/partners participation in the project, and pursuing are still to be determined for the TOD project, there is definitely potential for a additional partners and funding opportunities to public/private partnership TOD with the City move forward with a solution that provides the of Bellevue and Sound Transit as key partners, desired park-and-ride capacity while also building along with affordable housing interests and out the site in phases as a mixed-use TOD project private-sector partners. A partnership with affordable and market rate housing. mechanism for Sound Transit’s involvement needs to be identified. The study process supported by the Growing . There is favorable market potential for Transit Communities Partnership could be used as redevelopment in the station area. The Puget a model of collaboration in exploring TOD Sound Region TOD Market Study completed opportunities and applying similar lessons learned for the Growing Transit Communities in other station areas throughout the central Partnership in June 2012 found strong overall Puget Sound region. market indicators for the East Corridor and
strong residential/TOD demand for the 130th Avenue NE station area. This market demand DESCRIPTION OF CONCEPTUAL is based on the growing high tech industry in
Redmond and Bellevue, which the Bel-Red TOD SCENARIOS STUDIED Corridor is well positioned for, among other Potential TOD scenarios were formulated to test factors. The TOD Market Study highlighted in interrelated physical and financial feasibility of particular the potential to serve employees various types of construction and urban form seeking a more walkable, transit-rich lifestyle configurations. Three potential development as the economy continues to recover from the scenarios—‘A’, ‘B’, and ‘C’—were tested around recession and the high tech industry adds the same street and parcel framework (Parcel more jobs. 1/NW, Parcel 2/SW, and Parcel 3/SE). Other investors are realizing this potential and A “transit garage” with a minimum of 300 spaces moving ahead with projects, including Wright in a structured parking facility to accommodate Runstad, which is implementing the Spring park-and-ride for the light rail station was
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
included in all three scenarios (to replace the Scenario A capacity of the proposed surface parking lot). Sub- Overall Description alternatives analyzed in the financial pro formas This 5 over 1, mixed-use scenario envisions show the transit garage as either being funded residential units built in a five-story configuration separately, or as being funded as part of the site over a concrete ground floor with a podium. This development. configuration is typically called a “5+1.” Due to
the need to provide parking for the residents, The TOD scenarios vary in building construction types, height, active ground floor space, number along with ground floor commercial space, some of residential units, and location of the transit of the parking in this scenario would be located garage facility. underground. A separate free-standing transit 12 garage is also included in this scenario. All scenarios were developed in accordance with Proposed Land uses are configured as follows: the adopted Bel-Red zoning code provisions in the conceptual development of these scenarios, . Parcel 1: Park-and-ride with ground floor including requirements for active ground-floor active uses. space. Assuming there would be a focus on retail on the proposed shopping street context of 130th, . Parcel 2: Mixed-use residential in 5+1 wood other street frontages could emphasize a variety over concrete with structured parking above of other active uses, such as studio space for and below grade. artists, art galleries, dance lessons, and other uses consistent with the potential of this neighborhood . Parcel 3: Mixed-use residential in 5+1 wood further evolving into an arts and culture district. over concrete with structured parking above More in-depth analysis of the Code is needed to and below grade. analyze and confirm the range of active ground floor uses that could be implemented at the site. Constructability and Design Considerations . The proposed uses work well with the parcel A fourth, add-on development parcel, labeled ‘D’ geometry. In particular: also was conceptualized. While adding on this o The NW parcel has a good plot geometry parcel to any of the three development scenarios for the transit garage. would require the additional purchase of land o The SW/SE parcels have good plot (beyond what Sound Transit already intends to geometry for residential use. purchase for the parking area), developing this site could bring a variety of benefits to the transit- . SE and SW parcels show construction type oriented project and neighborhood, as discussed that maximizes wood frame construction over later in this report. concrete podium.
These scenarios are further described and . Building the transit garage facility on the NW analyzed in the following portion of this report. parcel may help activate ground floor Also refer to the layout and urban form retail/commercial/active use establishments illustrations of the scenarios at the end of this located en route between park-and-ride and report. These illustrations show the assumed mix light rail station. of at-grade active uses (retail, etc.) and housing for each scenario.
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
Scenario B was not applicable because it is a shared garage Overall Description concept, blended together into a functioning This mid-rise, mixed-use scenario envisions a more mixed-use, multipurpose project. Proposed land densely-developed site, with a 13-story mid-rise uses are organized as follows: . Parcel 1: Transit garage with ground floor structure housing both market rate and affordable retail, combined with residential “wrap” and rental, along with a 5+1 structure, and a free additional parking, 5+1 wood over concrete standing parking garage. Proposed land uses are with structured parking above and below organized as follows: grade. . Parcel 1: Mixed-use residential in 5+1 wood over concrete with structured parking above . Parcel 2: Townhomes, 3 stories, wood with 13 and below grade. at-grade parking.
. Parcel 2: Mixed-use residential tower . Parcel 3: Mixed-use residential in 5+1 wood maximum height 150’, steel and concrete with over concrete with structured parking above structured parking above and below grade. and below grade.
. Parcel 3: Park-and-ride (transit garage) with Constructability and Design Considerations ground floor active uses. . Best screening of multi-level parking on NW parcel by wrapping three block sides with Constructability and Design Considerations ground floor retail and residential at all upper . Transit garage on SE parcel adjacent to light levels. This building typology (aka “Texas rail station as a stand-alone with ground floor Wrap”) is less common in the Pacific retail. Northwest; however, more projects of this kind are recently being built (including some . SW parcel takes full advantage of 150’ height in Portland, Oregon). limit (13 story). There is the potential for increased corner presence, visibility, and . Lowest-intensity development of all views potential due to the tall tower. There alternatives on SW parcel with 12 townhome may be some view premiums related to views units. Having smaller structures helps create of Cascades/Mount Rainier and towards variety and smoother transition with adjacent downtown Bellevue skyline, and this building properties. type would make a bolder transit-oriented development statement. . Building the transit garage facility on the NW Parcel may help activate ground floor Scenario C retail/commercial establishments located en Overall Description route between park-and-ride and light rail station. This scenario proposes a wrap style building of a
transit garage wrapped with ground floor retail . SE parcel shows construction type that and housing, as well as 5+1 and townhouse (for maximizes wood frame construction over sale) product types on the site. To provide parking concrete podium, (5+1) (SE parcel is same as for both residents of the wrap building and transit Alternative A). riders, the wrap product type includes a central garage which would serve both kinds of parking needs in a single structure. Thus, for this scenario, testing feasibility with and without the transit garage as part of the private development project
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
Scenario D (As Potential Add-On to ridership goals. Along with these guiding premises, Scenario A, B, or C) several key assumptions influenced the financial analysis, as follows. Overall Description • Private Developer—The financial feasibility This parcel (Parcel 4) is conceptualized as residential in 5+1 wood over concrete with at- analysis assumes that a private developer grade parking podium. would own and develop the site. The analysis shows the cost of the transit garage included . Approximately ½ acre is dedicated to park use some sub-alternatives but not included in along the east side of Parcel 4, along Goff others (assuming it would be funded Creek. separately). Another possibility would be to 14 explore creating a joint development Constructability and Design Considerations agreement or mechanism with Sound Transit. . The green corridor and open space along Goff Sound Transit would then likely be involved a Creek can be an important feature of the neighborhood once it is restored and public ground lease situation for the land, if land gathering spaces and uses are developed. The ownership were retained by the transit combined park and creek corridor would serve agency. as a focal point of the neighborhood with recreational and social opportunities that • Provision of Garage for Transit Riders—In all enhance livability. of the alternative development programs, it was assumed that the “project” would include . This is a good family housing location, due to construction of a multi-story parking garage the proximity to the park/creek and buffered serving transit customers. Similarly to the location from transit station activity/noise, and the restored creek corridor and park surface lot now planned, it was assumed that could serve as a catalyst to other development there would be no charge to transit customers in the neighborhood. using this parking garage (e.g., free parking). Several alternatives, however, were tested to . There may be the potential to look at other implement this concept including alternatives public uses on this site, such as a small where the private developer would purchase neighborhood center or senior center at the the entire site (either from Sound Transit or site as a “third place” opportunity. from original owners) and fund and provide
the transit garage, and other alternatives . There may also be the potential to look at where the private development land purchase stormwater vault and/or filter systems for subregional stormwater management to serve would exclude the parcel needed for the the surrounding development. If grant funding transit garage, shrinking the private or public funding were obtained to construct development site size. In those alternatives, it these facilities, this could reduce the cost is assumed that Sound Transit would retain burden to private sector development and ownership of its garage parcel, and fund its serve as another catalyst to development own transit garage1. activity in the neighborhood.
1 BAE made these assumptions at the direction of project stakeholders. BAE has advised that a Sound Transit land KEY ASSUMPTIONS OF ANALYSIS purchase and then ground lease to private developers would It is important to note that the development be a likely development option; however, for the sake of scenarios were formulated to meet public policy simplifying the analysis, project stakeholders requested the goals as well as the needs of Sound Transit and its model to be built to test a direct purchase of land by private developers. 130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
• Compact Development Programs— In each product types, the affordable housing and this alternative, the development envisioned on- companion favorable LIHTC program with site would result in relatively dense, compact bond financing, is assumed for just the 5+1 development, with 6 to 13-story buildings building (wood frame over podium), in order (including parking in a podium/underground to maximize feasibility as costs rise to produce combination for the 6 story buildings, and at the wrap building envisioned in this scenario. grade in garage structures for the wrap and transit garage structures). While the • Retail for Street Activation— In keeping with alternatives vary in the development the City of Bellevue’s policies to activate prototypes envisioned, all of the alternatives major commercial corridors, the scenarios 15 would result in a transformative catalyst incorporate ground floor retail space at the project, with greater development density ground level of most of the residential than the 130th Street station area has today. structures, as well as varying amounts of retail These alternatives create “tomorrow’s” value space within the transit garage, to also make capture opportunities from adding transit this space more active at the street level. It service to this portion of the Bel-Red Corridor. should be noted, however, that a specific market analysis of the potential for market • Mixed-Income Housing—In addition, each demand for this retail space has not been physical development program was tested conducted. Additional analysis would be assuming a mix of market-rate and affordable needed to ensure that the level of housing to demonstrate how this retail/commercial/active uses would be transformative project could also meet supportable as the project builds out. This housing goals. The scenarios assume that the caution is given due to the challenges that State of Washington’s 4 percent Low Income some mixed-use housing and retail projects Housing Tax Credit (LIHTC) program would be face, in terms of their retail space allocations. utilized, which allows for both third-party In some cases with TODs, retail occupancy can equity contributions in exchange for tax lag behind housing occupancy, due to reliance credits (to support the feasibility and financing on the market created by new residents of the affordable units), as well as utilization moving into the housing. of the companion bond program to finance construction at tax-exempt interest rates, • Transit-Oriented Parking Ratios—Proposed lowering the overall costs of financing parking ratios of roughly 0.7 parking space per (applicable to all housing if certain housing unit were included in the Scenarios A percentages are made affordable per the and B, and a lower .67 parking space per LIHTC). residential unit for Scenario C. While relatively low in terms of current parking ratios, this In order to maximize overall feasibility, for approach is in keeping with the overall policy Scenarios A and B, the combination of 80 goal of reducing automobile ownership per percent of each housing alternative is household in the region at transit-oriented assumed as market-rate, and 20 percent is locations. The assumed ratios would be assumed affordable to households earning no allowable by City code provisions that give more than 50 percent of the Area Median flexibility for TOD projects with affordable Income (AMI) per LIHTC regulations. For housing and public amenities. Scenario C, which has three different housing
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TODs offer on-site residents the use of for parking in surface style, it is likely to incur transit to commute and travel, and improvement costs of at least $9,000,000 emerging car sharing and other options (assumes 300-surface lot spaces @ $3,000 per would provide the same residents to space; note that $3,000 per space is a low end access automobiles for longer-distance estimate and costs could be higher). In total, this trips as needed, without owning and expenditure as well as holding costs, could reach parking its household’s cars. The transit- $9 million or more, resulting in a surface parking oriented aspect of this type of lot that does not generate any income for the development project is key to its transit agency, assuming there is no charge for feasibility, providing a more sustainable the parking to transit customers. This strategy 16 lifestyle to residents, freeing up also does not provide built-form TOD and as household income for other purchases such, would not transform the area as and/or housing, and in general, envisioned by the City of Bellevue and the minimizing the overall costs incurred by Growing Transit Communities Partnership regional the developer for otherwise expensive initiatives. land and construction to “house” cars/vehicles. The scenarios envision a series of phased development projects with Sound Transit utilizing its station land in partnership with the City of FINANCIAL FEASIBILITY Bellevue, as well as affordable housing and private ANALYSIS development interests, to maximize on-site A financial feasibility analysis of the TOD scenarios development instead of the proposed surface (and sub-alternatives) envisioned for the 130th parking lot for transit riders. Building an actual Avenue NE station area site was conducted by BAE development project on the station site would Urban Economics. A representative from A advance the regional vision to “grow transit Regional Coalition for Housing (ARCH), a Growing communities,” by offering a more compact, Transit Communities Partner and member of the transit-oriented land use pattern for residents and East Corridor Task Force, assisted the process by workers to live and/or work near transit. adapting the financial model for use in evaluating various formulas of affordable housing. Given that Sound Transit is currently considering land acquisition and has started the design process for the surface parking area, this study Financial Assumptions Related to the helps to paint a picture of other options that could Surface Parking Lot Proposal be considered for the site, and considers the Sound Transit has preliminarily proposed to potential of using the funds for land acquisition develop a suburban-style surface parking lot with and construction of the surface parking lot as 300 spaces to serve park-and-ride transit partnership funds in the project. However, as was customers on the study site, immediately north of stated in the second workshop series, the Sound the light rail station at 130th Avenue NE. Transit Board has already certified property to be acquired at the site and the agency is starting This strategy would cost the agency approximately appraisals. As such, methods for Sound Transit’s $8 M in land acquisition costs for the roughly four- involvement in this project need to be further acre parcel at the station that would be dedicated explored. A mechanism would need to be to parking for transit riders (park-and-ride). In identified for reimbursing Sound Transit for the addition, if Sound Transit improves this property cost of the land purchase; and as discussed earlier,
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there is the potential to consider a joint “residual” land value matching current market development agreement/mechanism with Sound rate values for land: in other words: Does the Transit. project support the likely cost of acquitting the land to build this project type? Summary of the Initial Financial For the TOD scenarios, this test was done by Feasibility Analysis comparing the residual land value of the project, An initial financial feasibility analysis was to a $2M per acre assumed land value, based on conducted to explore four sub-alternatives for information provided to the consultant team. In each TOD Scenario (Scenarios A through C). These practice, this land value assumption would sub-alternatives were: 17 fluctuate, depending on a host of factors • Alternative 1: All market-rate housing with a including ownership, method of acquisition, real transit garage estate cycles, and how zoning and regulatory constraints impact eventual development “yield.” • Alternative 2: All market-rate housing with no transit garage funded by the private development project (e.g., assumes a smaller “Before” and “After” Potential Transit private development site and transit garage Agency Contribution would be built by others) The concept underlying the financial feasibility analysis includes a potential transit agency • Alternative 3: Mixed-income housing financial contribution to the project, based on the (including 20 percent affordable as described cost savings from not acquiring land and above) with a transit garage constructing a surface parking lot, but instead supporting this private project as needed to • Alternative 4: Mixed-income housing with no achieve feasibility. This contribution was tested transit garage funded by the private only for those concepts where the private development (e.g. assumes a smaller private development consumed the entire site, and development site and transit garage would be incorporated the transit garage parcel and costs to built by others) build it, into the private project.
It should be noted that for Scenario C, with a The next page shows a summary of the initial blended private and transit garage design, feasibility testing for the three design scenarios. separating the “with” and “without” transit garage Detailed pro formas are included as an Appendix alternatives was not possible for this analysis. to this report Thus, Scenario C was tested only for a “with transit garage” alternative, under both market rate and mixed-income assumptions.
Concept of Land Residual Value The financial feasibility analysis shown on the following pages tests for land residual value. This approach tests whether the total development revenues (including developer profit) exceed the total development costs sufficiently to generate
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Summary of Financial Feasibility Analysis for 130th Street Station Development Scenarios – Initial Feasibility Test
Charette Scenario A - Multiple 5+1 Buildings Charette Scenario B - Mid-Rise Buildings Charette Scenario C - 5+1, Wrap, and Townhouses Alternative 1 Alternative 2 Alternative 3 Alternative 4 Alternative 1 Alternative 2 Alternative 3 Alternative 4 Alternative 1 Alternative 2- NA Alternative 3Alternative 4- NA
Market Rate Market Rate Mixed Income Mixed Income Market Rate Market Rate Mixed Income Mixed Income Market Rate Market Rate Mixed Income Mixed Income with Transit without Transit with Transit without Transit with Transit without Transit with Transit without Transit with Transit without Transit with Transit without Transit Garage Parcel Garage Parcel Garage Parcel Garage Parcel Garage Parcel Garage Parcel Garage Parcel Garage Parcel Garage Parcel Garage Parcel Garage Parcel Garage Parcel Total Number of Residential Units 220 220 220 220 308 308 308 308 218 NA 218 NA Percent of Total Units - Market Rate 100.0% 100.0% 80.0% 80.0% 100.0% 100.0% 79.9% 79.9% 100.0% NA 88.1% NA Percent of Total Units - Affordable 0.0% 0.0% 20.0% 20.0% 0.0% 0.0% 20.1% 20.1% 0.0% NA 11.9% NA
Gross Built Square Feet Residential 227,700 227,700 222,640 222,640 318,780 318,780 313,433 313,433 234,060 NA 231,818 NA Retail 35,600 35,600 35,600 35,600 62,400 62,400 62,400 62,400 38,490 NA 38,490 NA Parking for Mixed-Use Project 54,600 54,600 54,600 54,600 75,600 75,600 75,600 75,600 18 50,750 NA 50,750 NA Subtotal MXD Project 317,900 317,900 312,840 312,840 456,780 456,780 451,433 451,433 323,300 NA 321,058 NA
Parking for Transit Garage (sq. ft.) 105,000 - 105,000 - 114,100 - 114,100 - 105,000 NA 105,000 NA
Parking Ratios: Residential 0.71 0.71 0.71 0.71 0.70 0.70 0.70 0.70 0.67 0.67
Residual Land Values Before Transit Agency Contribution: Total Land Value $ 3,928,171 $ 10,452,451 $ 4,520,256 $ 11,044,536 $ 17,346 $ 5,925,444 $ (7,931,058) $ (2,022,960) 2,806,151 NA (11,114,338) NA Land Value/Acre $ 972,320 $ 3,726,742 $ 1,118,875 $ 3,937,846 $ 4,294 $ 2,112,672 $ (1,963,133) $ (721,271) 694,592 NA (2,751,074) NA Land Value/Per Sq. Foot of Land $ 22.32 $ 85.55 $ 25.69 $ 90.40 $ 0 $ 49 $ (45) $ (17) 16 NA (63) NA Land Value / Per Residential Unit $ 4,420 $ 16,940 $ 5,086 $ 17,899 $ 14 $ 6,859 $ (6,374) $ (2,342) 3,186 NA (12,620) NA NA NA Minimum Land Value/Acre for Feasibility $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 NA $ 2,000,000 NA Feasible without Contribution or Subsidy No Yes No Yes No Yes No No No NA No NA
Transit Agency Contribution: Potential Transit Agency Contribution (b) $ 8,980,000 NA $ 8,980,000 NA $ 8,980,000 NA $ 8,980,000 NA $ 8,980,000 NA $ 8,980,000 NA Total Available to Support Project $ 12,908,171 NA $ 13,500,256 NA $ 8,997,346 NA $ 1,048,942 NA $ 11,786,151 NA $ (2,134,338) NA Per Acre Available to Support Project $ 3,195,092 NA $ 3,341,647 NA $ 2,227,066 NA $ 259,639 NA $ 2,917,364 NA $ (528,302) NA Feasible with Contribution Yes Yes Yes Yes Yes Yes No No Yes NA No NA a) Affordable housing included only in 5+1 building in Scenario C, due to need for higher rents in wrap to cover higher constrution costs (which would mean a greater loss to the project). The 5+1 building in the mixed-income alternatives is bond-financed as part of the 4% LIHTC program, similar to the other Scenarios. b) Transit Agency Contribution (from savings of not developing surface parking lot for transit riders) Land Acquisition for Surface Lot/Acre $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 Acres 4.04 4.04 4.04 4.04 4.04 4.04 Total Land Acquisition Cost $ 8,080,000 $ 8,080,000 $ 8,080,000 $ 8,080,000 $ 8,080,000 $ 8,080,000
Surface Lot Improvement Cost/Space $ 3,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000 Number of Spaces in Lot 300 300 300 300 300 300 Total Improvement Costs $ 900,000 $ 900,000 $ 900,000 $ 900,000 $ 900,000 $ 900,000
Total Costs Saved $ 8,980,000 $ 8,980,000 $ 8,980,000 $ 8,980,000 $ 8,980,000 $ 8,980,000
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The “cost savings” from not developing the Scenario B: Mid-Rise Buildings proposed Sound Transit parking lot totals just The mid-rise scenario is a more challenging under $9 M before carrying costs, as shown in the project, assuming market rate rents for residential 2 analysis . This funding is considered as and commercial spaces remain at the level “potentially available to support the project” and assumed. It should be noted that the models shown in the analysis to test whether those assume relatively conservative market rate rents; infeasible alternatives could be rendered feasible some TOD locations are able to achieve higher with some of this financial support. This concept rents, due to market recognition that living near is similar to and could be arranged as Sound transit brings many other benefits such as lower Transit supporting the costs of the transit garage costs for fewer automobiles. View premiums in 19 within the project. mid-rise towers can also increase rents in some locations. Summary of Findings from Initial Feasibility Testing If Sound Transit were able to contribute the cost savings as described, however, it is important to Scenario A: 5+1 note that the alternative of all market-rate housing with the transit garage would likely This scenario most closely matches the become feasible. Additional other subsidy, or a “pioneering” nature of multi-family TOD housing different source of funds, would be required at this study site. Typically, construction costs for above transit agency contributions, to support wood-frame residential buildings built over a development of a mixed-income mid-rise project. concrete ground floor with a podium supporting the wood-frame structure, have lower Scenario C: Wrap, 5+1, and Townhouses construction costs than mid-rise structures, allowing for the new multi-family rents (or sale For both alternatives for this scenario, which prices) to best create financial feasibility. includes a transit parking garage, transit agency participation in an amount equal to that In this scenario, the baseline “without transit committed to the surface parking lot would be garage” supports a feasible project in both the necessary to off-set the transit garage costs, market rate and mixed-income alternatives, with making the project feasible. residual land values in excess of the $2M threshold needed to acquire the land. It should be noted that some “wrap” housing projects can be flexibly designed so that costs are In the scenario where a transit garage is lower than the assumptions used in this analysis. constructed as part of the project, transit agency In addition, changing the mix to potentially more participation in the amount equal to that for-sale townhouses may enhance feasibility. committed to the surface parking lot would be Thus, further design and analysis would be needed sufficient to ff-set the transit garage costs, making to identify the ideal project mix that could achieve the project feasible. financial feasibility with this combination of market-rate and affordable housing, lower and mid-rise buildings, and the incorporation of a marketable “wrap” concept that also includes 2 A Sound Transit comment received on this analysis indicated transit rider garage spaces. that the agency would include additional land carrying costs for the period of ownership prior to sale to private developer; however, this period and those costs are not known and thus not estimated here. 130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
Refined Financial Feasibility Testing for included in the mixed-income scenarios count Scenario A toward the incentive system, reducing the in-lieu fees required. When stakeholders reviewed and discussed the
findings of the initial feasibility testing, two requests emerged. The group felt that Scenario A CONCLUSIONS AND reflected the best options in today’s marketplace,
especially for the 130th Avenue NE station area, RECOMMENDATIONS This type of transit-oriented, compact for which Sound Transit was acquiring land and development adjacent to a transit station fits moving forward with a surface parking lot plan. the concepts for implementation as advanced Secondly, stakeholders/reviewers requested that 20 by the Growing Transit Communities the model be further refined to better reflect the Partnership, by providing housing in proximity voluntary inclusionary regulations, which require to commuters along the Bel-Red Corridor. The payment to an in-lieu fee if market rate density TOD scenarios also align with the City of Bellevue’s bonuses are included in the project. adopted policies and plans and Sound Transit’s
adopted TOD policy. Implementing TOD at the The initial feasibility testing did not assume these 130th Avenue NE station would increase transit fee payments because the conceptual TOD ridership, catalyze neighborhood redevelopment, scenarios did not explicitly test with/without and enhance livability in the station area. density bonuses, but instead took the approach of maximizing the site by product type. Upon further analysis, it was determined that in-lieu fee Confirming Partnership Mechanisms payments would be required by market rate This early analysis has demonstrated that there developers to achieve the development projects are TOD scenarios that can be feasibly as drawn. Thus, a representatives from A Regional implemented at the study site, particularly if an Coalition for Housing assisted by refining the BAE approach can be found that would facilitate Sound model to include the fee payments on the market Transit’s partnership in the project. Such as a rate alternatives of with transit garage, and mechanism would need to allow Sound Transit to without transit garage, to reflect this payment use the funds they are intending to use to trade-off between market rate and mixed-income purchase the property and develop the surface options. The results of this refined model run are parking lot as partnership funds, or to reimburse provided in the Appendix. Sound Transit for land purchase as part of a different development pro forma. Focusing on As shown, the market rate development of this critical aspect of implementation will be Alternative 1 remains feasible when the transit important, and an obvious next step might be to agency contributes to the construction of the explore a joint development parking garage a comparable amount as it would agreement/mechanism. invest in a surface lot. Alternative 2 (which does not include the transit garage and assumes it Coordinating Site Development and would be developed separately) also maintains Sound Transit Construction Phasing feasibility, even with the incentive payments. Another important next step will need to involve working with Sound Transit to understand specific The mixed-income findings demonstrate less construction phasing and lay-down requirements impact from the fee payments and greater for this site and how these would affect phased financial feasibility. The affordable housing units site development. While a built TOD project on
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the site, with the transit garage on 1/3 of the site predominant bike commute patterns also will would free up 2/3 of the land for Sound Transit’s be important. use during construction, the actual phasing of development would need to be closely planned Refinements and Enhancements to with all development partners. As discussed in the Improve Financial Feasibility second workshop session, a potential phasing To enhance financial feasibility to a greater level, strategy might involve: the following actions are recommended for
further evaluation and exploration. 1. Sound Transit’s use of 2/3 of the site for
construction and-lay-down activities while 1/3 Design Refinements 21 is prepped for construction of transit garage and/or other mixed-use development. It is important to note that development of the TOD scenarios was preliminary and conceptual, 2. After light rail line construction is complete or prepared within a limited scope of work. As is near completion, perhaps another 1/3 of the typical in any development project, ongoing site could open for TOD construction. refinement of project components and iterative financial testing and adjusting of assumptions can 3. While the system is undergoing testing during improve financial viability. If the project were to the last 1-2 years before the station is open, it move forward into actual development, there may be that the last 1/3 (or 2/3) of the site would be additional conceptual design and could move into full development. financial analysis, along with adjustments to the program to meet the project partners’ objectives. 4. Coordination of site construction and phasing would need to ensure that the transit Future design should examine how application of garage/park-and-ride facility is operational at the City’s adopted system of incentives and the time the station opens by 2023. bonuses could be optimized to a greater level of Construction phasing also will need to ensure detail, which in turn could improve the financial that Sound Transit customers can access the return of the project. With design refinements, station easily without being impeded by project partners also can further explore the most construction activity. This will involve making desirable site development and construction sure there was an open path between the phasing configurations. transit garage and the station, and likely that the street right-of-way improvements The location of the transit parking facility could be (sidewalks, bike lanes, etc.) are completed on further evaluated as well, as the design scenarios 130th and 132nd since pedestrians and showed various options. While concerns were bicyclists will have access at the west and east raised about locating the transit garage on the NW ends of the platform. Installing the sidewalk parcel, further from the light rail platform, it is corridors along these streets prior to the important to note that with a fully developed TOD opening of the station will ensure that transit site, transit patrons would come from throughout customers can walk from the NW and NE the site, and not just from the transit garage. quadrants of the site (and destinations Transit commuters from a garage located on the beyond) directly to the entry plazas of the NW parcel would be accessing the light rail platform located near the intersections. platform from the entry plaza at the end of the Ensuring that bicycle parking facilities are block, and as such a well-lit sidewalk corridor conveniently located and aligned with would carry them directly to the platform. This
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pedestrian traffic would help to further activate Consider Financial Subsidy for Affordable the proposed retail frontage along 130th Avenue Housing NE. To increase policy goals regarding provision of affordable and workforce housing, the City could Further design work should also consider the consider utilizing various forms of financial advantages of locating active uses along the north subsidy, to increase the amount of affordable side of the station platform (rather than a blank housing beyond the 20 percent of total housing wall or surface parking lot), creating more “eyes” units assumed here, or further reduce the rent on the station. A lot of work was completed in the required to target lower AMI levels. earlier 130th Avenue NE Station Area Plan 22 highlighting optimal locations for development Analyze a Ground Lease Series of and parking areas and the best ways to active the Alternatives station by locating housing, jobs, retail/shopping, A ground lease series of alternatives should also lively public spaces, and other active uses adjacent be analyzed, because Sound Transit is acquiring to it and nearby, based a review of other stations. the land currently, and would likely be more able This earlier work will be a good reference for to contribute to the feasibility of compact future site design efforts. development at this site through ground lease payments adjusted as needed, rather than direct Consider the Implications of Time financial (cash) contributions. This would reduce The scenarios are very sensitive to the rent and the residual land value test to a structure where for-sale prices assumed. In many joint projects would just need to make ground lease development projects around the US, phasing of payments. This arrangement is common across the real estate development has become key, the US for joint development projects designed to especially as the transit and the development retrofit already-developed surface lots owned by work to transform the area. In other words, transit agencies to accommodate TOD. higher rents and sale prices, which in turn would enhance feasibility, may not be achievable in the first phase of a project, but once a “new neighborhood” of quality mixed-use housing and retail with the convenience of transit is market- tested, the subsequent phases of a project could then achieve higher rents. This often occurs when renters and buyers realize the overall value of locating at the transit station, both in terms of time saved, and the ability to lower their car ownership, thus saving dollars on car maintenance and fuel, leading to more dollars available for
other expenditures. Participants in the first workshop series for the 130th Avenue NE TOD Opportunity Study
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Summary of Refined Feasibility Test – Scenario A
Charette Scenario A - Multiple 5+1 Buildings - Refined Analysis Alternative 1 Alternative 2 Alternative 3 Alternative 4
Market Rate with Transit Market Rate without Mixed Income with Mixed Income without Garage Parcel Transit Garage Parcel Transit Garage Parcel Transit Garage Parcel Total Number of Residential Units 220 220 220 220 Percent of Total Units - Market Rate 100.0% 100.0% 80.0% 80.0% Percent of Total Units - Affordable 0.0% 0.0% 20.0% 20.0%
Gross Built Square Feet 23 Residential 227,700 227,700 222,640 222,640 Retail 35,600 35,600 35,600 35,600 Parking for Mixed-Use Project 54,600 54,600 54,600 54,600 Subtotal MXD Project 317,900 317,900 312,840 312,840
Parking for Transit Garage (sq. ft.) 105,000 - 105,000 -
Parking Ratios: Residential 0.71 0.71 0.71 0.71
Residual Land Values Before Transit Agency Contribution: Total Land Value $ 1,787,119 $ 8,311,399 $ 3,637,403 $ 10,161,683 Land Value/Acre $ 442,356 $ 2,963,366 $ 900,347 $ 3,623,071 Land Value/Per Sq. Foot of Land $ 10.16 $ 68.03 $ 20.67 $ 83.17 Land Value / Per Residential Unit $ 2,011 $ 13,470 $ 4,092 $ 16,469
Minimum Land Value/Acre for Feasibility $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 Feasible without Contribution or Subsidy No Yes No Yes
Transit Agency Contribution: Potential Transit Agency Contribution (b) $ 8,980,000 NA $ 8,980,000 NA Total Available to Support Project $ 10,767,119 NA $ 12,617,403 NA Per Acre Available to Support Project $ 2,665,128 NA $ 3,123,120 NA Feasible with Contribution Yes Yes Yes Yes a) Affordable housing included only in 5+2 building in Scenario C, due to need for higher rents in wrap to cover higher constrution costs (which would mean a greater loss to the project). The 5+2 building in the mixed-income alternatives is bond-financed as part of the 4% LIHTC program, similar to the other Scenarios. b) Transit Agency Contribution (from savings of not developing surface parking lot for transit riders) Land Acquisition for Surface Lot/Acre $ 2,000,000 $ 2,000,000 Acres 4.04 4.04 Total Land Acquisition Cost $ 8,080,000 $ 8,080,000
Surface Lot Improvement Cost/Space $ 3,000 $ 3,000 Number of Spaces in Lot 300 300 Total Improvement Costs $ 900,000 $ 900,000
Total Costs Saved $ 8,980,000 $ 8,980,000
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PROJECTED TRANSIT RIDERSHIP ANALYSIS (Continued on Next Page)
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130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment East C rrid r Implementati n Support
APPENDIX
PHASE 2 REPORT GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
Appendix: Initial Feasibility Test – Detailed Pro Formas
Charrette Scenario A - Multiple 5+1 Buildings No inflaton factors Does not account for density FAR purchase Charette Scenario A - Multiple 5+1 Buildings Pro Forma Analysis Alternative 1 Alternative 2 Alternative 3 Alternative 4 DEVELOPMENT COSTS Alt 1 Alt 2 Alt 3 Alt 4 Market Rate with Mark et Rate without Mixed Income with Mixed Income without Key Development Assuptions (Input) Transit Garage Parcel Transit Garage Parcel Transit Garage Parcel Transit Garage Parcel Residential Units - Hard & Soft Costs Market Rate $ 40,986,000 $ 40,986,000 $ 32,788,800 $ 32,788,800 Site Size (acres) with Transit Garage Parcel 4.04 2.80 4.04 2.80 Affordable $ - $ - $ 7,286,400 $ 7,286,400 Transit Garage Parcel (acres) 1.24 1.24 Subtotal $ 40,986,000 $ 40,986,000 $ 40,075,200 $ 40,075,200 Market-Rate Residential Units: Number of 1-BDR 110 110 88 88 Retail Space - MXD - Hard & Soft Costs $ 3,458,000 $ 3,458,000 $ 3,458,000 $ 3,458,000 Size of 1-BDR 700 700 700 700 Rent for 1-BDR $ 2.20 $ 1,540 $ 1,540 $ 1,540 $ 1,540 Parking for MXD - Hard & Soft Costs Market Rate Res Parking $ 3,335,000 $ 3,335,000 $ 2,668,000 $ 2,668,000 Number of 2-BDR 110 110 88 88 Affordable Res Parking $ - $ - $ 667,000 $ 667,000 Size of 2-BDR 1,100 1,100 1,100 1,100 Retail MXD Parking $ - $ - $ - $ - Rent for 2-BDR $ 2.00 $ 2,200 $ 2,200 $ 2,200 $ 2,200 Subtotal $ 3,335,000 $ 3,335,000 $ 3,335,000 $ 3,335,000
Total Residential Units 220 220 176 176 Transit Garage - Hard & Soft Costs Total Rentable Sq. Ft. 198,000 198,000 158,400 158,400 Parking Spaces $ 5,400,000 $ - $ 5,400,000 $ - Common Area 15% 29,700 29,700 23,760 23,760 Retail Space $ 1,170,000 $ 1,170,000 $ 1,170,000 $ 1,170,000 Total Residential Gross Sq. Ft. 227,700 227,700 182,160 182,160 Subtotal $ 6,570,000 $ 1,170,000 $ 6,570,000 $ 1,170,000
Vacancy Rate 5.0% 5.0% 5.0% 5.0% Impact Fees Market Rate Res Units $ 550,000 $ 550,000 $ 440,000 $ 440,000 Affordable Residential Units Affordable Res Units $ - $ - $ 110,000 $ 110,000 AMI Limit 50% 50.0% 50.0% 50.0% Subtotal $ 550,000 $ 550,000 $ 550,000 $ 550,000 Median Income $ 86,700 $ 86,700 $ 86,700 $ 86,700 Number of 1-BDR 0 0 22 22 Size of 1-BDR 650 650 650 650 Total Dev Costs Before Financing $ 54,899,000 $ 49,499,000 $ 53,988,200 $ 48,588,200 Rent for 1-BDR (King County Less Utility Allowance) $ 756 $ 756 $ 756 $ 756 Financing Costs (a) Number of 2-BDR 0 0 22 22 Interest for Conventional Portion $ 3,853,910 $ 3,474,830 $ 379,080 $ - Size of 2-BDR 950 950 950 950 Fees/Points for Conventional Portion $ 988,182 $ 890,982 $ 97,200 $ - Rent for 2-BDR (King County - Utility Allowance) $ 902 $ 902 $ 902 $ 902 Interest for Bond-Financed Portion $ - $ - $ 2,026,246 $ 2,026,246 Fees/Loan Costs for Bond-Financed Portion $ - $ - $ 211,067 $ 211,067 Total Residential Units 0 0 44 44 Subtotal $ 4,842,092 $ 4,365,812 $ 2,713,593 $ 2,237,313 Total Rentable Sq. Ft. - - 35,200 35,200 Common Area 15% - - 5,280 5,280 Total Dev Costs exc. Land & Profit $ 59,741,092 $ 53,864,812 $ 56,701,793 $ 50,825,513 Total Residential Gross Sq. Ft. - - 40,480 40,480 VALUE ANALYSIS (at Yr 2 stablization) Alt 1 Alt 2 Alt 3 Alt 4 Vacancy Rate 5.0% 5.0% 5.0% 5.0% Market-Rate Residential Units Retail Space Gross Rental Revenue $ 4,936,800 $ 4,936,800 $ 3,949,440 $ 3,949,440 Sq. Ft. in MXD Buildings 26,600 26,600 26,600 26,600 Less: Vacancy $ (246,840) $ (246,840) $ (197,472) $ (197,472) Sq. Ft. in Transit Garage 9,000 9,000 9,000 9,000 Less: Property Taxes $ (440,000) $ (440,000) $ - $ - Total Sq. Ft. 35,600 35,600 35,600 35,600 Less: Operating Costs $ (990,000) $ (990,000) $ (792,000) $ (792,000) Rent/sq.ft. (NNN) $ 2.00 $ 2.00 $ 2.00 $ 2.00 NOI $ 3,259,960 $ 3,259,960 $ 2,959,968 $ 2,959,968 Vacancy Rate 10.0% 10.0% 10.0% 10.0% Affordable Residential Units Parking: Gross Rental Revenue $ - $ - $ 437,762 $ 437,762 For Residential Units Less: Vacancy $ - $ - $ (21,888) $ (21,888) At-Grade Podium Garage - Number of Spaces 113 113 113 113 Less: Property Taxes $ - $ - $ - $ - At-Grade Podium Garage - Cost per Space $ 20,000 $ 20,000 $ 20,000 $ 20,000 Less: Operating Costs $ - $ - $ (242,000) $ (242,000) Below-Grade Number of Spaces 43 43 43 43 NOI $ - $ - $ 173,873 $ 173,873 Below-Grade Cost per Space $ 25,000 $ 25,000 $ 25,000 $ 25,000 Total Parking Spaces for Residential Units 156 156 156 156 Retail - MXD Gross Rental Revenue $ 638,400 $ 638,400 $ 638,400 $ 638,400 For Retail Space: Less: Vacancy $ (63,840) $ (63,840) $ (63,840) $ (63,840) At-Grade Podium Number of Spaces 0 - - - NOI $ 574,560 $ 574,560 $ 574,560 $ 574,560 At-Grade Cost per Space $ 20,000 $ 20,000 $ 20,000 $ 20,000 Retail - Transit Garage For Transit At-Grade Garage Gross Rental Revenue $ 216,000 $ 216,000 $ 216,000 $ 216,000 Number of Spaces (inc. pkg for retail in garage) 300 0 300 0 Less: Vacancy $ (21,600) $ (21,600) $ (21,600) $ (21,600) Cost per Space $ 18,000 $ 18,000 $ 18,000 $ 18,000 NOI $ 194,400 $ 194,400 $ 194,400 $ 194,400
Market Rate Financing Costs Caplitalized Value of Project Loan-to-Cost Ratio 90.0% 90% 90% 90% Market-Rate Residential Units $ 59,272,000 $ 59,272,000 $ 53,817,600 $ 53,817,600 Interest Rate 6.5% 6.5% 6.5% 6.5% Affordable Residential Units $ - $ - $ 2,897,890 $ 2,897,890 Fees/Points/Loan Costs 2.0% 2.0% 2.0% 2.0% Retail - MXD $ 8,208,000 $ 8,208,000 $ 8,208,000 $ 8,208,000 Loan Period (months) 24 24 24 24 Retail - Transit Garage $ 2,777,143 $ 2,777,143 $ 2,777,143 $ 2,777,143 Avg. Outstanding Balance 60% 60% 60% 60% Afordable Financing Costs (Bond) Total Capitalized Value $ 70,257,143 $ 70,257,143 $ 67,700,633 $ 67,700,633 Loan-to-Cost Ratio 90.0% 90% 90% 90% Interest Rate 4.0% 4.0% 4.0% 4.0% Residual Land Value Fees/Points/Loan Costs 0.5% 0.5% 0.5% 0.5% Total Capitalized Value $ 70,257,143 $ 70,257,143 $ 67,700,633 $ 67,700,633 Loan Period (months) 24 24 24 24 Less: Development Costs $ (59,741,092) $ (53,864,812) $ (56,701,793) $ (50,825,513) Avg. Outstanding Balance 60% 60% 60% 60% Less: Developer Profit $ (6,587,880) $ (5,939,880) $ (6,478,584) $ (5,830,584) Total Residual Land Value $ 3,928,171 $ 10,452,451 $ 4,520,256 $ 11,044,536 Hard Costs - Residential/sq.ft. $ 150 $ 150 $ 150 $ 150 Residual Land Value/Acre $ 972,320 $ 3,726,742 $ 1,118,875 $ 3,937,846 Hard Costs - Retail / sq. ft. inc. tenant allowance $ 130 $ 130 $ 130 $ 130 Soft Costs (as % of hard) 20.0% 20.0% 20.0% 20.0% Impact Fees/Res Unit $ 2,500 $ 2,500 $ 2,500 $ 2,500 Developer Profit (as % of Hard + Soft Costs) 12.0% 12.0% 12.0% 12.0%
Operating Costs - Market Rate Unit/Yr $ 4,500 $ 4,500 $ 4,500 $ 4,500 Property Taxes - Market Rate (approx) $ 2,000 $ 2,000 $ 2,000 $ 2,000 Operating Costs - Aff Unit/Yr $ 5,500 $ 5,500 $ 5,500 $ 5,500 Property Taxes - Affordable NA NA NA NA
Cap Rate - Market Rate Residential 5.5% 5.5% 5.5% 5.5% Cap Rate - Affordable Residential 6.0% 6.0% 6.0% 6.0% Cap Rate - Retail MXD 7.0% 7.0% 7.0% 7.0% Cap Rate - Retail in Transit Garage 7.0% 7.0% 7.0% 7.0% Outputs - Do Not Edit Total Number of Residential Units 220 220 220 220 Financing Cost Calculations Percent of Total Units - Market Rate 100.0% 100.0% 80.0% 80.0% Conventional Loan Percent of Total Units - Affordable 0.0% 0.0% 20.0% 20.0% Amount of Loan $ 49,409,100 $ 44,549,100 $ 4,860,000 $ - Interest $ 3,853,910 $ 3,474,830 $ 379,080 $ - Gross Built Square Feet Points/Fees $ 988,182 $ 890,982 $ 97,200 $ - Residential 227,700 227,700 222,640 222,640 Retail 35,600 35,600 35,600 35,600 Bond Loan For Market Rate Portion Parking for Mixed-Use Project 350 54,600 54,600 54,600 54,600 Amount of Loan for Mkt Res + Retail NA NA $ 36,472,320 $ 36,472,320 Subtotal MXD Project 317,900 317,900 312,840 312,840 Interest NA NA $ 1,750,671 $ 1,750,671 Points/Fees NA NA $ 182,362 $ 182,362 Parking for Transit Garage (sq. ft.) 350 105,000 - 105,000 - Bond Loan For Aff Res + Aff Parking Portion Parking Ratios: Total Dev Cost Before Land for Aff Res + Aff Pkg NA NA $ 8,063,400 $ 8,063,400 Residential 0.71 0.71 0.71 0.71 Equity Calc: LIHTC Basis NA NA $ 8,063,400 $ 8,063,400 Residual Land Values: Tax Credit Term NA NA 10 10 Total Land Value $ 3,928,171 $ 10,452,451 $ 4,520,256 $ 11,044,536 Tax Credit Rate NA NA 3.2% 3.2% Land Value/Acre $ 972,320 $ 3,726,742 $ 1,118,875 $ 3,937,846 Tax Credit Price NA NA $ 0.90 $ 0.90 Land Value/Per Sq. Foot of Land $ 22.32 $ 85.55 $ 25.69 $ 90.40 Total Equity Raised NA NA $ 2,322,259 $ 2,322,259 Land Value / Per Residential Unit $ 4,420 $ 16,940 $ 5,086 $ 17,899 Balance to be Financed NA NA $ 5,741,141 $ 5,741,141 Interest NA NA $ 275,575 $ 275,575 Points/Fees NA NA $ 28,706 $ 28,706
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
Charrette Scenario B - Mid-Rise Buildings No inflaton factors Charette Scenario B - Mid-Rise Buildings Pro Forma Analysis Alternative 1 Alternative 2 Alternative 3 Alternative 4 DEVELOPMENT COSTS Alt 1 Alt 2 Alt 3 Alt 4 Market Rate with Transit Garage Mark et Rate without Mixed Income with Mixed Income without Key Development Assuptions (Input) Parcel Transit Garage Parcel Transit Garage Parcel Transit Garage Parcel Residential Units - Hard & Soft Costs Market Rate $ 66,943,800 $ 66,943,800 $ 53,468,100 $ 53,468,100 Site Size (acres) with Transit Garage Parcel 4.04 2.80 4.04 2.80 Affordable $ - $ - $ 12,352,725 $ 12,352,725 Transit Garage Parcel (acres) 1.24 1.24 Subtotal $ 66,943,800 $ 66,943,800 $ 65,820,825 $ 65,820,825 Market-Rate Residential Units: Number of 1-BDR 154 154 123 123 Retail Space - MXD - Hard & Soft Costs $ 5,772,000 $ 5,772,000 $ 5,772,000 $ 5,772,000 Size of 1-BDR 700 700 700 700 Rent for 1-BDR $ 2.20 $ 1,540 $ 1,540 $ 1,540 $ 1,540 Parking for MXD - Hard & Soft Costs Market Rate Res Parking $ 3,888,000 $ 3,888,000 $ 3,105,351 $ 3,105,351 Number of 2-BDR 154 154 123 123 Affordable Res Parking $ - $ - $ 782,649 $ 782,649 Size of 2-BDR 1,100 1,100 1,100 1,100 Retail MXD Parking $ - $ - $ - $ - Rent for 2-BDR $ 2.00 $ 2,200 $ 2,200 $ 2,200 $ 2,200 Subtotal $ 3,888,000 $ 3,888,000 $ 3,888,000 $ 3,888,000
Total Residential Units 308 308 246 246 Transit Garage - Hard & Soft Costs Total Rentable Sq. Ft. 277,200 277,200 221,400 221,400 Parking Spaces $ 4,890,000 $ - $ 4,890,000 $ - Common Area 15% 41,580 41,580 33,210 33,210 Retail Space $ 2,340,000 $ 2,340,000 $ 2,340,000 $ 2,340,000 Total Residential Gross Sq. Ft. 318,780 318,780 254,610 254,610 Subtotal $ 7,230,000 $ 2,340,000 $ 7,230,000 $ 2,340,000
Vacancy Rate 5.0% 5.0% 5.0% 5.0% Impact Fees Market Rate Res Units $ 770,000 $ 770,000 $ 615,000 $ 615,000 Affordable Residential Units Affordable Res Units $ - $ - $ 155,000 $ 155,000 AMI Limit 50% 50% 50% 50% Subtotal $ 770,000 $ 770,000 $ 770,000 $ 770,000 Median Income $ 86,700 $ 86,700 $ 86,700 $ 86,700 Number of 1-BDR 0 0 31 31 Size of 1-BDR 650 650 650 650 Total Dev Costs Before Financing $ 84,603,800 $ 79,713,800 $ 83,480,825 $ 78,590,825 Rent for 1-BDR (King County Less Utility Allowance) $ 756 $ 756 $ 756 $ 756 Financing Costs (a) Number of 2-BDR 0 0 31 31 Interest for Conventional Portion $ 5,939,187 $ 5,595,909 $ 343,278 $ - Size of 2-BDR 1,000 1,000 1,000 1,000 Fees/Points for Conventional Portion $ 1,522,868 $ 1,434,848 $ 88,020 $ - Rent for 2-BDR (King County - Utility Allowance) $ 902 $ 902 $ 902 $ 902 Interest for Bond-Financed Portion $ - $ - $ 3,275,191 $ 3,275,191 Fees/Loan Costs for Bond-Financed Portion $ - $ - $ 341,166 $ 341,166 Total Residential Units 0 0 62 62 Subtotal $ 7,462,055 $ 7,030,757 $ 4,047,655 $ 3,616,357 Total Rentable Sq. Ft. - - 51,150 51,150 Common Area 15% - - 7,673 7,673 Total Dev Costs exc. Land & Profit $ 92,065,855 $ 86,744,557 $ 87,528,480 $ 82,207,182 Total Residential Gross Sq. Ft. - - 58,823 58,823 VALUE ANALYSIS (at Yr 2 stablization) Alt 1 Alt 2 Alt 3 Alt 4 Vacancy Rate 5.0% 5.0% 5.0% 5.0% Market-Rate Residential Units Retail Space Gross Rental Revenue $ 6,911,520 $ 6,911,520 $ 5,520,240 $ 5,520,240 Sq. Ft. in MXD Buildings 44,400 44,400 44,400 44,400 Less: Vacancy $ (345,576) $ (345,576) $ (276,012) $ (276,012) Sq. Ft. in Transit Garage 18,000 18,000 18,000 18,000 Less: Property Taxes $ (616,000) $ (616,000) $ (492,000) $ (492,000) Total Sq. Ft. 62,400 62,400 62,400 62,400 Less: Operating Costs $ (1,386,000) $ (1,386,000) $ (1,107,000) $ (1,107,000) Rent/sq.ft. (NNN) $ 2.00 $ 2.00 $ 2.00 $ 2.00 NOI $ 4,563,944 $ 4,563,944 $ 3,645,228 $ 3,645,228 Vacancy Rate 10.0% 10.0% 10.0% 10.0% Affordable Residential Units Parking: Gross Rental Revenue $ - $ - $ 616,846 $ 616,846 For Residential Units Less: Vacancy $ - $ - $ (30,842) $ (30,842) At-Grade Podium Garage - Number of Spaces 216 216 216 216 Less: Property Taxes $ - $ - $ - $ - At-Grade Garage - Cost per Space $ 18,000 $ 18,000 $ 18,000 $ 18,000 Less: Operating Costs $ - $ - $ (341,000) $ (341,000) Below-Grade Number of Spaces 0 0 0 0 NOI $ - $ - $ 245,003 $ 245,003 Below-Grade Cost per Space $ 25,000 $ 25,000 $ 25,000 $ 25,000 Total Parking Spaces for Residential Units 216 216 216 216 Retail - MXD Gross Rental Revenue $ 1,065,600 $ 1,065,600 $ 1,065,600 $ 1,065,600 For Retail Space: Less: Vacancy $ (106,560) $ (106,560) $ (106,560) $ (106,560) At-Grade Podium Number of Spaces 0 0 0 0 NOI $ 959,040 $ 959,040 $ 959,040 $ 959,040 At-Grade Cost per Space $ 18,000 $ 18,000 $ 18,000 $ 18,000 Retail - Transit Garage For Transit At-Grade Garage Gross Rental Revenue $ 432,000 $ 432,000 $ 432,000 $ 432,000 Number of Spaces (inc. pkg for retail in garage) 326 0 326 0 Less: Vacancy $ (43,200) $ (43,200) $ (43,200) $ (43,200) Cost per Space $ 15,000 $ 15,000 $ 15,000 $ 15,000 NOI $ 388,800 $ 388,800 $ 388,800 $ 388,800
Market Rate Financing Costs Caplitalized Value of Project Loan-to-Cost Ratio 90.0% 90.0% 90.0% 90.0% Market-Rate Residential Units $ 82,980,800 $ 82,980,800 $ 66,276,873 $ 66,276,873 Interest Rate 6.5% 6.5% 6.5% 6.5% Affordable Residential Units $ - $ - $ 4,083,391 $ 4,083,391 Fees/Points/Loan Costs 2.0% 2.0% 2.0% 2.0% Retail - MXD $ 13,700,571 $ 13,700,571 $ 13,700,571 $ 13,700,571 Loan Period (months) 24 24 24 24 Retail - Transit Garage $ 5,554,286 $ 5,554,286 $ 5,554,286 $ 5,554,286 Avg. Outstanding Balance 60% 60% 60% 60% Afordable Financing Costs (Bond) Total Capitalized Value $ 102,235,657 $ 102,235,657 $ 89,615,121 $ 89,615,121 Loan-to-Cost Ratio 90.0% 90.0% 90.0% 90.0% Interest Rate 4.0% 4.0% 4.0% 4.0% Residual Land Value Fees/Points/Loan Costs 0.5% 0.5% 0.5% 0.5% Total Capitalized Value $ 102,235,657 $ 102,235,657 $ 89,615,121 $ 89,615,121 Loan Period (months) 24 24 24 24 Less: Development Costs $ (92,065,855) $ (86,744,557) $ (87,528,480) $ (82,207,182) Avg. Outstanding Balance 60% 60% 60% 60% Less: Developer Profit $ (10,152,456) $ (9,565,656) $ (10,017,699) $ (9,430,899) Total Residual Land Value $ 17,346 $ 5,925,444 $ (7,931,058) $ (2,022,960) Hard Costs - Residential/sq.ft. $ 175 $ 175 $ 175 $ 175 Residual Land Value/Acre 4,294 2,112,672 (1,963,133) (721,271) Hard Costs - Retail / sq. ft. inc. tenant allowance $ 130 $ 130 $ 130 $ 130 Soft Costs (as % of hard) 20.0% 20.0% 20.0% 20.0% Impact Fees/Res Unit $ 2,500 $ 2,500 $ 2,500 $ 2,500 Developer Profit (as % of Hard + Soft Costs) 12.0% 12.0% 12.0% 12.0%
Operating Costs - Market Rate Unit/Yr $ 4,500 $ 4,500 $ 4,500 $ 4,500 Property Taxes - Market Rate (approx) $ 2,000 $ 2,000 $ 2,000 $ 2,000 Operating Costs - Aff Unit/Yr $ 5,500 $ 5,500 $ 5,500 $ 5,500 Property Taxes - Affordable NA NA NA NA
Cap Rate - Market Rate Residential 5.5% 5.5% 5.5% 5.5% Cap Rate - Affordable Residential 6.0% 6.0% 6.0% 6.0% Cap Rate - Retail MXD 7.0% 7.0% 7.0% 7.0% Cap Rate - Retail in Transit Garage 7.0% 7.0% 7.0% 7.0% Outputs - Do Not Edit Total Number of Residential Units 308 308 308 308 Financing Cost Calculations Percent of Total Units - Market Rate 100.0% 100.0% 79.9% 79.9% Conventional Loan Percent of Total Units - Affordable 0.0% 0.0% 20.1% 20.1% Amount of Loan $ 76,143,420 $ 71,742,420 $ 4,401,000 $ - Interest $ 5,939,187 $ 5,595,909 $ 343,278 $ - Gross Built Square Feet Points/Fees $ 1,522,868 $ 1,434,848 $ 88,020 $ - Residential 318,780 318,780 313,433 313,433 Retail 62,400 62,400 62,400 62,400 Bond Loan For Market Rate Portion Parking for Mixed-Use Project 350 75,600 75,600 75,600 75,600 Amount of Loan for Mkt Res + Retail NA NA $ 58,770,406 $ 58,770,406 Subtotal MXD Project 456,780 456,780 451,433 451,433 Interest NA NA $ 2,820,979 $ 2,820,979 Points/Fees NA NA $ 293,852 $ 293,852 Parking for Transit Garage (sq. ft.) 350 114,100 - 114,100 - Bond Loan For Aff Res + Aff Parking Portion Parking Ratios: Total Dev Cost Before Land for Aff Res + Aff Pkg NA NA $ 13,290,374 $ 13,290,374 Residential 0.70 0.70 0.70 0.70 Equity Calc: LIHTC Basis NA NA $ 13,290,374 $ 13,290,374 Residual Land Values: Tax Credit Term NA NA 10 10 Total Land Value $ 17,346 $ 5,925,444 $ (7,931,058) $ (2,022,960) Tax Credit Rate NA NA 3.2% 3.2% Land Value/Acre $ 4,294 $ 2,112,672 $ (1,963,133) $ (721,271) Tax Credit Price NA NA $ 0.90 $ 0.90 Land Value/Per Sq. Foot of Land $ 0.10 $ 48.50 $ (45.07) $ (16.56) Total Equity Raised NA NA $ 3,827,628 $ 3,827,628 Land Value / Per Residential Unit $ 14 $ 6,859 $ (6,374) $ (2,342) Balance to be Financed NA NA $ 9,462,747 $ 9,462,747 Interest NA NA $ 454,212 $ 454,212 Points/Fees NA NA $ 47,314 $ 47,314
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
Charrette Scenario C - Wrap, Townhouses, & 5+1 Buildings No inflaton factors Charette Scenario C - Wrap, Townhouses, & 5+1 Buildings Pro Forma Analysis Alternative 1 Alternative 2 - NA Alternative 3 Alternative 4 - NA DEVELOPMENT COSTS - RENTAL PORTIONS OF PROJECT Alt 1 Alt 2 Alt 3 Alt 4 Market Rate with Transit Garage Mark et Rate without Mixed Income with Mixed Income without Key Development Assuptions (Input) Parcel Transit Garage Parcel Transit Garage Parcel Transit Garage Parcel 5+1 Building Market Rate Portion Site Size (acres) with Transit Garage Parcel 4.04 4.04 Hard & Soft Costs for Units $ 24,219,000 $ - $ 19,375,200 $ - Transit Garage Parcel (acres) Impact Fees $ 325,000 $ - $ 260,000 $ - Market-Rate Rental Residential Units in 5+1: Parking for Units $ 1,297,018 $ - $ 1,037,615 $ - Number of 1-BDR 65 52 Subtotal $ 25,841,018 $ - $ 20,672,815 $ - Size of 1-BDR 700 700 Rent for 1-BDR $ 2.20 $ 1,540 $ - Affordable Portion Hard & Soft Costs for Units $ - $ - $ 4,440,150 $ - Number of 2-BDR 65 52 Impact Fees $ - $ - $ 65,000 $ - Size of 2-BDR 1,100 1,100 Parking for Units $ - $ - $ - $ - Rent for 2-BDR $ 2.00 $ 2,200 $ - Subtotal $ - $ - $ 4,505,150 $ -
Total Residential Units 130 104 Retail Portion Total Rentable Sq. Ft. 117,000 93,600 Hard & Soft Costs $ 2,447,640 $ - $ 2,447,640 $ - Common Area 15% 17,550 14,040 Parking for Retail $ - $ - $ - $ - Total Residential Gross Sq. Ft. 134,550 107,640 Subtotal $ 2,447,640 $ - $ 2,447,640 $ -
Vacancy Rate 5.0% 5.0% Total Costs for 5+1 Building $ 28,288,658 $ - $ 27,625,605 $ -
Affordable Rental Residential Units in 5+1: AMI Limit 50% 50% Wrap Building Median Income $ 86,700 $ - Market Rate Rental in Wrap - Hard & Soft $ 15,160,860 $ - $ 15,160,860 $ - Number of 1-BDR 0 13 Size of 1-BDR 650 650 Retail in Wrap Building - Hard & Soft $ 3,556,800 $ - $ 3,556,800 $ - Rent for 1-BDR (King County Less Utility Allowance) $ 756 $ - Parking in Wrap (inc. 300 spaces for transit riders) $ 5,258,257 $ - $ 5,258,257 $ - Impact Fees for Wrap Building $ 190,000 $ - $ 190,000 $ - Number of 2-BDR 0 13 Total Costs for Wrap Building $ 24,165,917 $ - $ 24,165,917 $ - Size of 2-BDR 1,000 1,000 Rent for 2-BDR (King County - Utility Allowance) $ 902 $ - Total Dev Costs Before Financing $ 52,454,575 $ - $ 51,791,522 $ -
Total Residential Units 0 26 Financing Costs (a) Total Rentable Sq. Ft. - 21,450 Interest for Conventional Loan for 5+1 and Wrap $ 4,091,457 $ - $ 1,884,942 $ - Common Area 15% - 3,218 Fees/Points for Conventional Loan $ 1,049,092 $ - $ 483,318 $ - Total Residential Gross Sq. Ft. - 24,668 Interest for Bond-Financed Portion (5+1 Mixed income buiilding) $ - $ - $ 1,152,772 $ - Fees/Loan Costs for Bond-Financed Portion (5+1 mixed-income bldg $ - $ - $ 120,080 $ - Vacancy Rate 5.0% 5.0% Subtotal $ 5,140,548 $ - $ 3,641,112 $ -
Market Rate Rental Residential Units in Wrap: Total Dev Costs exc. Land & Profit - Income Portions of Project $ 57,595,124 $ - $ 55,432,633 $ - Number of 1-BDR 38 38 VALUE ANALYSIS (at Yr 2 stablization) Alt 1 Alt 2 Alt 3 Alt 4 Size of 1-BDR 750 750 Market-Rate Res Rental Units (both buildings) Rent for 1-BDR $ 1,650 $ 1,650 Gross Rental Revenue $ 4,063,200 $ - $ 2,238,000 $ - Less: Vacancy $ (203,160) $ - $ (111,900) $ - Number of 2-BDR 38 38 Less: Property Taxes $ (260,000) $ - $ - $ - Size of 2-BDR 1,200 1,200 Less: Operating Costs $ (585,000) $ - $ - $ - Rent for 2-BDR $ 2,300 $ 2,300 NOI $ 3,015,040 $ - $ 2,126,100 $ -
Total Residential Units 76 76 Affordable Res Rental Units (5+1 building) Total Rentable Sq. Ft. 74,100 74,100 Gross Rental Revenue $ - $ - $ - $ - Common Area 10% 7,410 7,410 Less: Vacancy $ - $ - $ - $ - Total Residential Gross Sq. Ft. 81,510 81,510 Less: Property Taxes $ - $ - $ - $ - Less: Operating Costs $ - $ - $ - $ - Vacancy Rate NOI $ - $ - $ - $ -
Townhouse Market Rate For-Sale Units: Retail - MXD Number of Units 12 12 Gross Rental Revenue $ 923,760 $ - $ 923,760 $ - Size of Units 1,500 1,500 Less: Vacancy $ (92,376) $ - $ (92,376) $ - For-Sale Price $ 450,000 $ 450,000 NOI $ 831,384 $ - $ 831,384 $ -
Retail Space Caplitalized Value of Income Portions of Project Sq. Ft. in 5+1 Building 15,690 15,690 Market-Rate Residential Units $ 54,818,909 #DIV/0! $ 38,656,364 #DIV/0! Sq. Ft. in Wrap Building 22,800 22,800 Affordable Residential Units $ - #DIV/0! $ - #DIV/0! Total Sq. Ft. 38,490 38,490 Retail - MXD $ 11,876,914 #DIV/0! $ 11,876,914 #DIV/0! Rent/sq.ft. (NNN) $ 2.00 $ 2.00 Total Capitalized Value $ 66,695,823 #DIV/0! $ 50,533,278 #DIV/0! Vacancy Rate 10.0% 10.0%
Parking: Residual Land Value for Income Portions of Project For Residential Units Total Capitalized Value $ 66,695,823 #DIV/0! $ 50,533,278 #DIV/0! At-Grade Garage - Number of Spaces 145 145 Less: Development Costs $ (57,595,124) $ - $ (55,432,633) $ - At-Grade Garage - Cost per Space $ 15,000 $ 15,000 Less: Developer Profit $ (6,294,549) $ - $ (6,214,983) $ - Below-Grade Number of Spaces 0 0 Residual Land Value $ 2,806,151 #DIV/0! $ (11,114,338) #DIV/0! Below-Grade Cost per Space $ - $ - Total Parking Spaces for Residential Units 145 145
For Retail Space: Townhouse Component At-Grade Number of Spaces 0 0 Revenue From Sales $ 5,400,000 $ - $ 5,400,000 $ - At-Grade Cost per Space $ - $ - Less:Development Costs - Hard & Soft $ (3,996,000) $ - $ (3,996,000) $ - Less: Impact Fees $ (30,000) $ - $ (30,000) $ - For Transit At-Grade Garage (in Wrap Bldg Garage) Less: Financing Costs - Interest (b) $ (141,313) $ - $ (141,313) $ - Number of Spaces 300 300 Less: Financing Costs - Points (b) $ (72,468) $ - $ (72,468) $ - Cost per Space $ 15,000 $ - Less: Developer Profit $ (479,520) $ - $ (479,520) $ - Residual Land Value $ 680,699 $ - $ 680,699 $ - Market Rate Rental Financing Costs Loan-to-Cost Ratio 90.0% 90.0% Interest Rate 6.5% 6.5% Total Residual Land Value $ 2,806,151 #DIV/0! $ (11,114,338) #DIV/0! Fees/Points/Loan Costs 2.0% 2.0% Residual Land Value/Acre 694,592 #DIV/0! (2,751,074) #DIV/0! Loan Period (months) 24 24 Avg. Outstanding Balance 60% 60% Afordable Rental Financing Costs (Bond) Loan-to-Cost Ratio 90.0% 90.0% Interest Rate 4.0% 4.0% Fees/Points/Loan Costs 0.5% 0.5% Loan Period (months) 24 24 Avg. Outstanding Balance 60% 60%
Market Rate Townhouse Construction Loan Loan-to-Cost Ratio 90.0% 90.0% Interest Rate 6.5% 6.5% Fees/Points/Loan Costs 2.0% 2.0% Loan Period (months) 12 12 Avg. Outstanding Balance 60% 60%
Hard Costs - Wrap Residential/sq.ft. $ 155 $ 155 Hard Costs - 5+1 Residential $ 150 $ 150 Hard Costs - Townhouse $ 185 $ 185 Hard Costs - Retail / sq. ft. inc. tenant allowance $ 130 $ 130 Soft Costs (as % of hard) 20.0% 20.0% Impact Fees/Res Unit $ 2,500 $ 2,500 Developer Profit (as % of Hard + Soft Costs) 12.0% 12.0%
Operating Costs - Market Rate Unit/Yr $ 4,500 $ - Property Taxes - Market Rate Rental (approx) $ 2,000 $ - Operating Costs - Aff Unit/Yr $ 5,500 $ - Property Taxes - Affordable Rental 1.8% NA NA
Cap Rate - Market Rate Rental Residential 5.5% 5.5% Cap Rate - Affordable Rental Residential 6.0% 6.0% Cap Rate - Retail MXD 7.0% 7.0% Cap Rate - Retail in Transit Garage 7.0% 7.0% Outputs - Do Not Edit Total Number of Residential Units 218 218 (a) Financing Cost Calculations Total For-Sale Units 12 12 Conventional Loan (in 5+1 if all market rate, plus wrap building inc. transit spaces) Total Rental Units 206 206 5+1 Building $ 28,288,658 $ - NA NA Rental Units in Mixed-Income Building (5+1) 130 130 Wrap Building $ 24,165,917 $ - $ 24,165,917 $ - Percent of Rental Units - Market Rate 100.0% 80.0% Total Loan Amount $ 52,454,575 $ - $ 24,165,917 $ - Percent of Rental Units - Affordable 0.0% 20.0% Interest $ 4,091,457 $ - $ 1,884,942 $ - Points/Fees $ 1,049,092 $ - $ 483,318 $ - Gross Built Square Feet Rental Residential 216,060 213,818 Bond Loan For 5+1 Building if Aff Housing Included) For-Sale Townhouses 18,000 18,000 Amount of Loan for Mkt Res + Parking + Retail NA NA $ 20,808,409 $ - Retail 38,490 38,490 Interest NA NA $ 998,804 $ - Parking for Mixed-Use Project 350 50,750 50,750 Points/Fees NA NA $ 104,042 $ - Subtotal MXD Project 323,300 321,058 Bond Loan For Aff Res + Aff Parking Portion Parking for Transit Garage (sq. ft.) 350 105,000 105,000 Total Dev Cost Before Land for Aff Res + Aff Pkg NA NA $ 4,505,150 $ - Equity Calc: Parking Ratios: LIHTC Basis NA NA $ 4,505,150 $ - Residential 0.67 0.67 Tax Credit Term NA NA 10 10 Tax Credit Rate NA NA 3.2% 3.2% Residual Land Values: Tax Credit Price NA NA $ 0.90 $ 0.90 Total Land Value $ 2,806,151 $ (11,114,338) Total Equity Raised NA NA $ 1,297,483 $ - Land Value/Acre $ 694,592 $ (2,751,074) Balance to be Financed NA NA $ 3,207,667 $ - Land Value/Per Sq. Foot of Land $ 15.95 $ (63.16) Interest NA NA $ 153,968 $ - Land Value / Per Residential Unit $ 3,186 $ (12,620) Points/Fees NA NA $ 16,038 $ -
(b) Conventional Loan - Townhouses Total Loan Amount $ 3,623,400 $ - $ 3,623,400 $ - Interest $ 141,313 $ - $ 141,313 $ - Points/Fees $ 72,468 $ - $ 72,468 $ -
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment GROWING TRANSIT COMMUNITIES PARTNERSHIP | East Corridor Implementation Support Project | DECEMBER 2013
Appendix: Refined Feasibility Testing for Scenario A (5+1)
Charrette Scenario A - Multiple 5+2 Buildings -Refined Analysis to Incorporate Incentive Payments No inflaton factors Does not account for density FAR purchase Charette Scenario A - Multiple 5+1 Buildings Pro Forma Analysis Alternative 1 Alternative 2 Alternative 3 Alternative 4 DEVELOPMENT COSTS Alt 1 Alt 2 Alt 3 Alt 4 Market Rate with Transit Garage Mark et Rate without Mixed Income with Mixed Income without Key Development Assuptions (Input) Parcel Transit Garage Parcel Transit Garage Parcel Transit Garage Parcel Residential Units - Hard & Soft Costs Market Rate $ 40,986,000 $ 40,986,000 $ 32,788,800 $ 32,788,800 Site Size (acres) with Transit Garage Parcel 4.04 2.80 4.04 2.80 Affordable $ - $ - $ 7,286,400 $ 7,286,400 Transit Garage Parcel (acres) 1.24 1.24 Subtotal $ 40,986,000 $ 40,986,000 $ 40,075,200 $ 40,075,200 Market-Rate Residential Units: Number of 1-BDR 110 110 88 88 Retail Space - MXD - Hard & Soft Costs $ 3,885,200 $ 3,885,200 $ 3,885,200 $ 3,885,200 Size of 1-BDR 700 700 700 700 Rent for 1-BDR $ 2.20 $ 1,540 $ 1,540 $ 1,540 $ 1,540 Parking for MXD - Hard & Soft Costs Market Rate Res Parking $ 3,335,000 $ 3,335,000 $ 2,668,000 $ 2,668,000 Number of 2-BDR 110 110 88 88 Affordable Res Parking $ - $ - $ 667,000 $ 667,000 Size of 2-BDR 1,100 1,100 1,100 1,100 Retail MXD Parking $ - $ - $ - $ - Rent for 2-BDR $ 2.00 $ 2,200 $ 2,200 $ 2,200 $ 2,200 Subtotal $ 3,335,000 $ 3,335,000 $ 3,335,000 $ 3,335,000 Total Residential Units 220 220 176 176 Transit Garage - Hard & Soft Costs Total Rentable Sq. Ft. 198,000 198,000 158,400 158,400 Parking Spaces $ 5,400,000 $ - $ 5,400,000 $ - Common Area 15% 29,700 29,700 23,760 23,760 Retail Space $ 1,170,000 $ 1,170,000 $ 1,170,000 $ 1,170,000 Total Residential Gross Sq. Ft. 227,700 227,700 182,160 182,160 Subtotal $ 6,570,000 $ 1,170,000 $ 6,570,000 $ 1,170,000 Vacancy Rate 5.0% 5.0% 5.0% 5.0% City Impact Fees / Incentive / Infrastructure Market Rate Res Units $ 1,894,901 $ 1,894,901 $ 699,459 $ 699,459 Affordable Residential Units Affordable Res Units $ - $ - $ 180,000 $ 180,000 AMI Limit 50% 50.0% 50.0% 50.0% Subtotal $ 1,894,901 $ 1,894,901 $ 879,459 $ 879,459 Median Income $ 86,700 $ 86,700 $ 86,700 $ 86,700 Number of 1-BDR 0 0 22 22 Size of 1-BDR 650 650 650 650 Total Dev Costs Before Financing $ 56,671,101 $ 51,271,101 $ 54,744,859 $ 49,344,859 Rent for 1-BDR (King County Less Utility Allowance) $ 756 $ 756 $ 756 $ 756 Financing Costs (a) Number of 2-BDR 0 0 22 22 Interest for Conventional Portion $ 3,978,311 $ 3,599,231 $ 379,080 $ - Size of 2-BDR 950 950 950 950 Fees/Points for Conventional Portion $ 1,020,080 $ 922,880 $ 97,200 $ - Rent for 2-BDR (King County - Utility Allowance) $ 902 $ 902 $ 902 $ 902 Interest for Bond-Financed Portion $ - $ - $ 2,058,302 $ 2,058,302 Fees/Loan Costs for Bond-Financed Portion $ - $ - $ 214,406 $ 214,406 Total Residential Units 0 0 44 44 Subtotal $ 4,998,391 $ 4,522,111 $ 2,748,989 $ 2,272,709 Total Rentable Sq. Ft. - - 35,200 35,200 Common Area 15% - - 5,280 5,280 Total Dev Costs exc. Land & Profit $ 61,669,492 $ 55,793,212 $ 57,493,847 $ 51,617,567 Total Residential Gross Sq. Ft. - - 40,480 40,480 VALUE ANALYSIS (at Yr 2 stablization) Alt 1 Alt 2 Alt 3 Alt 4 Vacancy Rate 5.0% 5.0% 5.0% 5.0% Market-Rate Residential Units Retail Space Gross Rental Revenue $ 4,936,800 $ 4,936,800 $ 3,949,440 $ 3,949,440 Sq. Ft. in MXD Buildings 26,600 26,600 26,600 26,600 Less: Vacancy $ (246,840) $ (246,840) $ (197,472) $ (197,472) Sq. Ft. in Transit Garage 9,000 9,000 9,000 9,000 Less: Property Taxes $ (440,000) $ (440,000) $ - $ - Total Sq. Ft. 35,600 35,600 35,600 35,600 Less: Operating Costs $ (990,000) $ (990,000) $ (792,000) $ (792,000) Rent/sq.ft. (NNN) $ 2.00 $ 2.00 $ 2.00 $ 2.00 NOI $ 3,259,960 $ 3,259,960 $ 2,959,968 $ 2,959,968 Vacancy Rate 10.0% 10.0% 10.0% 10.0% Affordable Residential Units Parking: Gross Rental Revenue $ - $ - $ 437,762 $ 437,762 For Residential Units Less: Vacancy $ - $ - $ (21,888) $ (21,888) At-Grade Podium Garage - Number of Spaces 113 113 113 113 Less: Property Taxes $ - $ - $ - $ - At-Grade Podium Garage - Cost per Space $ 20,000 $ 20,000 $ 20,000 $ 20,000 Less: Operating Costs $ - $ - $ (242,000) $ (242,000) Below-Grade Number of Spaces 43 43 43 43 NOI $ - $ - $ 173,873 $ 173,873 Below-Grade Cost per Space $ 25,000 $ 25,000 $ 25,000 $ 25,000 Total Parking Spaces for Residential Units 156 156 156 156 Retail - MXD Gross Rental Revenue $ 638,400 $ 638,400 $ 638,400 $ 638,400 For Retail Space: Less: Vacancy $ (63,840) $ (63,840) $ (63,840) $ (63,840) At-Grade Podium Number of Spaces 0 - - - NOI $ 574,560 $ 574,560 $ 574,560 $ 574,560 At-Grade Cost per Space $ 20,000 $ 20,000 $ 20,000 $ 20,000 Retail - Transit Garage For Transit At-Grade Garage Gross Rental Revenue $ 216,000 $ 216,000 $ 216,000 $ 216,000 Number of Spaces (inc. pkg for retail in garage) 300 0 300 0 Less: Vacancy $ (21,600) $ (21,600) $ (21,600) $ (21,600) Cost per Space $ 18,000 $ 18,000 $ 18,000 $ 18,000 NOI $ 194,400 $ 194,400 $ 194,400 $ 194,400
Market Rate Financing Costs Caplitalized Value of Project Loan-to-Cost Ratio 90.0% 90% 90% 90% Market-Rate Residential Units $ 59,272,000 $ 59,272,000 $ 53,817,600 $ 53,817,600 Interest Rate 6.5% 6.5% 6.5% 6.5% Affordable Residential Units $ - $ - $ 2,897,890 $ 2,897,890 Fees/Points/Loan Costs 2.0% 2.0% 2.0% 2.0% Retail - MXD $ 8,208,000 $ 8,208,000 $ 8,208,000 $ 8,208,000 Loan Period (months) 24 24 24 24 Retail - Transit Garage $ 2,777,143 $ 2,777,143 $ 2,777,143 $ 2,777,143 Avg. Outstanding Balance 60% 60% 60% 60% Afordable Financing Costs (Bond) Total Capitalized Value $ 70,257,143 $ 70,257,143 $ 67,700,633 $ 67,700,633 Loan-to-Cost Ratio 90.0% 90% 90% 90% Interest Rate 4.0% 4.0% 4.0% 4.0% Residual Land Value Fees/Points/Loan Costs 0.5% 0.5% 0.5% 0.5% Total Capitalized Value $ 70,257,143 $ 70,257,143 $ 67,700,633 $ 67,700,633 Loan Period (months) 24 24 24 24 Less: Development Costs $ (61,669,492) $ (55,793,212) $ (57,493,847) $ (51,617,567) Avg. Outstanding Balance 60% 60% 60% 60% Less: Developer Profit $ (6,800,532) $ (6,152,532) $ (6,569,383) $ (5,921,383) Total Residual Land Value $ 1,787,119 $ 8,311,399 $ 3,637,403 $ 10,161,683 Hard Costs - Residential/sq.ft. $ 150 $ 150 $ 150 $ 150 Residual Land Value/Acre $ 442,356 $ 2,963,366 $ 900,347 $ 3,623,071 Hard Costs - Retail / sq. ft. inc. tenant allowance $ 130 $ 130 $ 130 $ 130 Soft Costs (as % of hard) 20.0% 20.0% 20.0% 20.0% Impact Fees $ 427,200 $ 427,200 $ 427,200 $ 427,200 Infrastructure $ - $ - $ - $ - Retail Impact Fees / Incentive / Infrastructure $ 427,200 $ 427,200 $ 427,200 $ 427,200 Impact Fees $ - $ - $ - $ - Infrastructure $ - $ - $ 180,000 $ 180,000 Aff Hsng Impact Fees / Incentive / Infrastructure $ - $ - $ 180,000 $ 180,000 Impact Fees (Including credit for existing) $ 63,059 $ 63,059 $ (20,541) $ (20,541) Incentive requirements $ 931,842 $ 931,842 $ - $ - Infrastructure $ 900,000 $ 900,000 $ 720,000 $ 720,000 Market Hing Impact Fees / Incentive / Infrastructure $ 1,894,901 $ 1,894,901 $ 699,459 $ 699,459 Developer Profit (as % of Hard + Soft Costs) 12.0% 12.0% 12.0% 12.0% Operating Costs - Market Rate Unit/Yr $ 4,500 $ 4,500 $ 4,500 $ 4,500 Property Taxes - Market Rate (approx) $ 2,000 $ 2,000 $ 2,000 $ 2,000 Operating Costs - Aff Unit/Yr $ 5,500 $ 5,500 $ 5,500 $ 5,500 Property Taxes - Affordable NA NA NA NA
Cap Rate - Market Rate Residential 5.5% 5.5% 5.5% 5.5% Cap Rate - Affordable Residential 6.0% 6.0% 6.0% 6.0% Cap Rate - Retail MXD 7.0% 7.0% 7.0% 7.0% Cap Rate - Retail in Transit Garage 7.0% 7.0% 7.0% 7.0% Outputs - Do Not Edit Total Number of Residential Units 220 220 220 220 Financing Cost Calculations Percent of Total Units - Market Rate 100.0% 100.0% 80.0% 80.0% Conventional Loan Percent of Total Units - Affordable 0.0% 0.0% 20.0% 20.0% Amount of Loan $ 51,003,991 $ 46,143,991 $ 4,860,000 $ - Interest $ 3,978,311 $ 3,599,231 $ 379,080 $ - Gross Built Square Feet Points/Fees $ 1,020,080 $ 922,880 $ 97,200 $ - Residential 227,700 227,700 222,640 222,640 Retail 35,600 35,600 35,600 35,600 Bond Loan For Market Rate Portion Parking for Mixed-Use Project 350 54,600 54,600 54,600 54,600 Amount of Loan for Mkt Res + Retail NA NA $ 37,090,313 $ 37,090,313 Subtotal MXD Project 317,900 317,900 312,840 312,840 Interest NA NA $ 1,780,335 $ 1,780,335 Points/Fees NA NA $ 185,452 $ 185,452 Parking for Transit Garage (sq. ft.) 350 105,000 - 105,000 - Bond Loan For Aff Res + Aff Parking Portion Parking Ratios: Total Dev Cost Before Land for Aff Res + Aff Pkg NA NA $ 8,133,400 $ 8,133,400 Residential 0.71 0.71 0.71 0.71 Equity Calc: LIHTC Basis NA NA $ 8,133,400 $ 8,133,400 Residual Land Values: Tax Credit Term NA NA 10 10 Total Land Value $ 1,787,119 $ 8,311,399 $ 3,637,403 $ 10,161,683 Tax Credit Rate NA NA 3.2% 3.2% Land Value/Acre $ 442,356 $ 2,963,366 $ 900,347 $ 3,623,071 Tax Credit Price NA NA $ 0.90 $ 0.90 Land Value/Per Sq. Foot of Land $ 10.16 $ 68.03 $ 20.67 $ 83.17 Total Equity Raised NA NA $ 2,342,419 $ 2,342,419 Land Value / Per Residential Unit $ 2,011 $ 13,470 $ 4,092 $ 16,469 Balance to be Financed NA NA $ 5,790,981 $ 5,790,981 Interest NA NA $ 277,967 $ 277,967 Points/Fees NA NA $ 28,955 $ 28,955
130TH AVENUE NE TRANSIT-ORIENTED DEVELOPMENT Opportunity Study and Financial Assessment B D C A
130TH Ave. NE TOD Study Decemmber 2013 Bellevue, Washington
130TH Ave. NE TOD Study December 2013 Bellevue, Washington
Right ofway dedication NEParcel:Right 45,996 (45%) Park Parcel 22,762SF NE Parcel 33,619SF ofway dedicationParcelsRight 1thru3:85,934 SF(49%) Total Parcels 1thru3:89,997 SF(51%) SE parcel 33,967SF SW parcel 22,412SF NW parcel 33,618SF Future development parcels: Existing Sound Transit Parcels=approximately 175,931 SF(4.04Acres) within theproposedbuilding types (constant) framework. urban urban ance. additionitallows In usto evaluate thebest locationofthese thebestlocation ofthese concrete/steela 13story tower thatmaximizes maximizes the150’ the150’ heightallow- height allow- buildinganda buildinganda apartment “Texas-wrap”“Texas-wrap” building, to building, apartment style to apartment style townhouses, frombuilding types: 3story double-loaded viaa5-over-1 double-loaded The study, above, setup as described above, allows allows us to usto analyze analyze arange a rangeof of ity. any point,orleave orleave itout,thusallowing itout,for thusallowing for maximumphasingfl maximumphasingfl exibil- proposed street grid makesitpossibleto plugthepuzzlepiece inat We includethisparcel inourstudyasastand-alonepuzzlepiece. The eastofthe Sound eastoftheSound jacent piece piece ofland, ofland, north directly north directly TransitTransit property. property. addition,weIn were askedto explore whatcould what bedonewithanad- could bedonewithanad- withinthisframework:A, B, A,B,building types andC. andC. aconstant,structure andwe andwe created created 3studyalternatives 3studyalternatives thatvary that vary 2 andSEparcel 3.For ofourstudy, thepurpose ofourstudy, we we keptthisblock keptthisblock ment parcels) parcels) ontheSound ontheSound TransitTransit NWparcel NWparcel properties: 1.SWparcel properties: 1.SWparcel The resulting street grid creates three blocks(ordevelop- three blocks(ordevelop- (3)newcity (3)newcity and 132stAvenues, to allow for future street improvements. Finally, dimensionto existing130th right-of-way we we dedicated dedicated extra right-of-way dimensionto extra existing 130th transitparcel, line. parcel,NW Sound line. againstraddlingtheexistingproperty againstraddling theexisting property location for for 17thstreet 17th street wasdefi was defi line ofthe property ned by thenorth north. tion Area north. Plan:16thstreet Plan: and17thstreetThe 16thstreet extension farther and17thstreetThe extension farther Ave. We alsoprovided two (2)east-west streets, streets, according according to theSta- to theSta- Transit parcels to bedeveloped withhalf-street improvements of131st of131st lines. lines.that straddlestheexistingproperty straddles theexisting property This allowsThis allows for for theSound theSound We 131stAve, provided anorth-south between 130thand132ndAve, based ontheStationArea Area Plan. Plan. cels thatSound Sound TransitTransit hasidentifi hasidentifi park-and-ride, ed for theirsurface we developed aframework or or “urban“urban blockstructure”, blockstructure”, onthree onthree (3)par- (3)par- Following thefi rstcharrette andafter receiving from direction client, Plan alternatives alternatives approach. approach. rst charrette receiving andafter from direction client, ned by the north property lineofthe property ned by thenorth ed for their surface park-and-ride,ed for theirsurface exibil-
130TH Ave. NE TOD Study December 2013 Bellevue, Washington
130TH Ave. NE TOD Study December 2013 Bellevue, Washington
Block A Block A Total A Block A active Pand Pand active residential residential residential residential residential total P total parking residential residential residential residential residential activeuses total parking and NW SW SE R R R uses+parking uses ee nt parking units level ee nt parking units level ee nt parking units level GF GF GF Ͳ1 Ͳ1 26 26 26 2 26 3 4 5 6 2 3 4 18 18 18 3 18 4 5 6 18 2 130 220 26 90 0 tlsretail stalls tlsretail stalls tlsretail stalls 300 456 96 38 622,800 36 09,000 70 96 56 92 211,200 32 64 32 22,800 43,000 11,200 raparking area raparking area raparking area ,0 n/a 9,000 ratio ratio ratio 0.71 0.71 0.71 Ffloorplate resSF res Ffloorplate resSF 132,000 2,0 447,025 224,000 92,000 26,40026 64026,400 26,400 26,400 26,400 26,400 26,400 26,400 26,400 84018,400 18,400 18,400 18,400 18,400 18,400 18,400 18,400 84018,400 18,400 Ffloorplate SF , 400 0 134,400 187,000 125,625 26,40026 33,600 33,600 33,600 22,000 33,600 33,000 22,400 11225 , 400
AA 130TH Ave. NE TOD Study December 2013 Bellevue, Washington
Block B Block B Total B Block B residential residential residential residential residential residential residential residential active Pand Pand Pand residential residential total residential active residential total parking active residential total residential residential parking residential parking NW SE SW R R R uses+parking uses uses ee nt parking units level ee nt parking units level ee nt parking units level GF GF GF 018 18 10 11 12 218 12 318 13 Ͳ1 18 9 26 26 26 3 26 4 5 6 18 8 26 2 2 3 4 18 7 18 6 18 5 18 2 4 3 130 310 180 18 0 tlsretail stalls tlsretail stalls tlsretail stalls 325 4 2400.70 62,400 541 126 94 94 94 318,000 43 022,000 30 60 63 90 63 22,400 0 18,000 22,000 22,400 raparking area raparking area raparking area n/a ratio ratio ratio 0.69 0.70 Ffloorplate resSF Ffloorplate resSF Ffloorplate resSF 128,000 8,0 251,200 184,000 1,0 567,200 312,000 18 84018,400 18,400 18,400 18,400 84018,400 18,400 56025,600 25,600 25,600 25,600 25,600 25,600 25,600 25,600 84018,400 18,400 56025,600 25,600 84018,400 18,400 84018,400 18,400 18 84018,400 18,400 84018,400 18,400 84018,400 18,400 , 0 18 400 0 132,000 184,000 18 33,000 33,000 33,000 22,400 33,000 22,400 22,400 33,600 22,400 , 400
B 130TH Ave. NE TOD Study December 2013 Bellevue, Washington
Block C Block C Block C active total total residential+parking residential+parking live/work residential residential residential+parking residential+parking residential+parking parking parking residential parking residential residential residential residential total active Total SW NW SE uses uses ee nt parking units level ee nt parking units level ee nt parking units level GF F12 GF GF 16 2 16 3 16 4 2 3 16 5 12 6 7 8 26 6 9 26 5 26 4 26 3 26 2 130 218 12 76 tlsretail stalls tlsretail stalls tlsretail stalls 443 5 2800.73 22,800 459 115,690 51 50 50 16 50 50 63,200 16 50 50 50 42 0 15,690 22,800 22,800 raparking area raparking area raparking area 3,200 ratio ratio ratio 1.33 1.88 0.00 Ffloorplate resSF Ffloorplate resSF Ffloorplate resSF 132,000 6,0 452,585 160,000 36,000 80,000 60033,600 16,000 60033,600 16,000 20012,000 12,000 12,000 12,000 60033,600 16,000 60033,600 16,000 60033,600 16,000 20012,000 12,000 64026,400 26,400 64026,400 26,400 64026,400 26,400 64026,400 26,400 64026,400 26,400 251,585 165,000 36,000 33,600 17,600 17,600 33,000 14785
C 130TH Ave. NE TOD Study December 2013 Bellevue, Washington
Block D residential residential residential residential residential parking total total NE ee nt parking units level GF 22 6 26 5 26 4 26 3 26 2 126 126 tlsretail stalls 87 87 700.69 0 87 raparking area 0 ratio 0.69 Ffloorplate resSF 128,000 2,0 161,600 128,000 56025,600 25,600 56025,600 25,600 56025,600 25,600 56025,600 25,600 56025,600 25,600 161,600 33,600
D 130TH Ave. NE TOD Study December 2013 Bellevue, Washington
D B C A
130TH Ave. NE TOD Study December 2013 Bellevue, Washington
The enclosed comment letters were submitted in October 2013 after the draft 130th TOD Opportunity Study was completed. This final report addresses the comments in these letters.
C:\Users\mandir\Dropbox\EAST CORRIDOR FINAL REPORTS\130th TOD OPPORTUNITY\The enclosed comment letters were submitted in October 2013 after the draft 130th TOD Opportunity Study was completed.doc
C IIy of Be levue Post Office Box 90012 . Bellevue, Washington . 98009 9012
October 30, 2013
Mary Pat Lawlor Principal Planner Puget Sound Regional Council 1011 Western Avenue, Ste,500 Seattle, WA 98104
Dear Ms. Lawlor,
Thankyou forgiving usthe opportunityto collaborate on this reviewof TOD potentialatthe L30th Avenue Station, through the Eastside Corridor Task Force of Growing Tronsit Communities. We appreciate all the work by PSRC and the OTAK team to advance this opportunity in Bellevue.
City and ARCH staffworked with you and the consultant, OTAK, to clarify elements of the Bellevue code, especially those relating to the allowed FAR, bonus system, parking ratios, on-site infrastructure, right- of-way dedication, site development costs and impact fees. We've also worked with you regarding specificassumptionsoftheproforma. lfwecanbeofanyadditionalassistanceinclarifyinghowthe code applies or other inputs to the proforma, please let us know.
The draft study does an excellent job exploring development opportunities for the 130th site that would result in a successful TOD project and an integrated park and ride that meet Sound Transit's objectives. While the study is preliminary and more work will be needed to pursue a TOD project, this early work demonstrates the potentialof such a project and shows how it would not only provide park and ride parking, but would directly increase transit ridership, activate the neighborhood, and create an attractive urban development that could catalyze adjacent development.
The study supports and builds off of the early station area planning work that the city completed last year. That early effort looked at examples of other transit stations that show how development can help activate an area near a station and create housing, jobs and lively public spaces. Some examples specifically showed how parking for stations can be arranged to both help activate the area - by designing walking paths through active pedestrian corridors - and how parking areas benefit from increased security by putting pedestrians in well-lit, heavily traveled locations. ln your analysis the alternatives with the park and ride garage in the Northwest portion of the site echoed the benefits of the earlier work. Additionally, by avoiding a blank wall (or surface lot) next to the station platform and having more "eyes" facing the station, those same alternatives improve station safety. lf there is still an opportunity to make changes to the final report, we would suggest that it would be helpfulfor the report to state the intent of the assessment more clearly and to reiterate Sound Transit's and Bellevue's shared objectives. The purpose of the analysis might be stated as exploring the following question: Could a public/private partnership result in a joint TOD/park-and-ride that advances a transit- supportive land use vision, in lieu of a stand-alone surface park-and-ride that is a deterrent to a transit- supportive environment-all without requiring additional Sound Transit funding? Additional value of the analysis is to explore what forms of development look most promising, to test key variables, and to help identify what needs to be looked at further during subsequent steps.
The proforma analysis includes alternatives with and without Sound Transit funding. Since all of the alternatives include a park and ride, this appears to show some alternatives that site and build public parking supply for free. While we understand that the modelers may have done this as part of their analytical methodology, it creates confusion. Could these scenarios be described in a way that clarifies their interpretation? The intent was to ensure that Sound Transit would be kept whole, not to have a private TOD development shoulder all the costs associated with the park and ride.
Lastly, it may help to make the report clearer about what issues need further investigation and what next steps would be appropriate given the findings of the work to date.
Thank you again for the work you've completed. We found the process of collaborating with PSRC, Sound Transit and others on this case study to be very effective. lt helped all of us better understand future possibilities for creating a successful development at the 13Oth Avenue station and to further our shared objectives.
Sincerely,
Planning Director
Mandi Roberts, OTAK Leonard McGhee, Sound Transit Scott Kirkpatrick, Sound Transit