Land costs imperil industry
Tue, 11/21/2006
Driving across the Ballard Bridge, a visitor cannot help but notice the mass of fishing vessels and shipyards on Salmon Bay and the Ship Canal. Ballard is home port for the bulk of the North Pacific fishing fleet, and has been for much of the past century.
Its future in Seattle is being threatened not from the sea but from the land.
The maritime industry in Ballard and Interbay is feeling the pressure of Seattle's booming real estate market, and many people in the industry, as well as public officials, are worried that the city's zoning protection is not strong enough to keep the maritime industry from being pushed off the shores of Seattle for good.
"The impression I was getting in doing the study was that it was like some sort of slow-death process because of the pressure on land prices and relatively unfriendly environment for the businesses in general," said economist Paul Sommers, who co-authored a study of the maritime industry for the city in 2004.
The maritime industry has "always had some kind of development pressures on (it) because we're loud and turn lights on late at night," said Peter Phillips, director of Seattle Marine Business Coalition.
In recent years, Ballard's industrial land has come under increasing pressure from commercial developers. New and potential developments in Ballard's industrial land include Ballard Blocks, a Silver Cloud Inn, the Nordic Heritage Museum, and a commercial marina. All of which will bring more people into Ballard's industrial land.
Seattle has seen a dramatic rise in the pressure to convert industrial land to other uses in recent years. City Council ordered a study to be conducted reviewing the 'conversion pressure' on industrial land, land use code, and Seattle's future needs for industrial land.
"There is a lot of pressure to redevelop industrial land," said Councilman Peter Steinbrueck. "It's seen as underutilized by some ... I disagree vehemently."
Steinbrueck and Councilman David Della backed the study, which was requested by the Planning Commission.
In a preliminary study, the Planning Commission singled out Vancouver, B.C., "where the council decided to allow the substantial conversion of industrial lands, thereby changing the character of their city. Vancouver's downtown now boasts lots of new housing development but diminishing prospects for employment."
"The goal is to develop a long-term plan for the city's industrial land to make sure we have enough and to provide guidance to the city's leaders," said Tom Hauger, a land use planner at Seattle's Department of Planning and Development.
Zoning is the city's primary tool for managing growth, said Hauger. In the city's Comprehensive Plan established two industrial areas, the Duwamish Manufacturing/Industrial Center and the Ballard-Interbay Northend Manufacturing/Industrial Center, known by its acronym, BINMIC.
Infrastructure is another but less effective tool, Hauger added. However, the study "is not going to revisit any decisions about the Burke-Gilman Trail."
The study will review a loophole in the land use code that permits 75,000 square feet of commercial space on certain types of industrially zoned land, and has no minimum lot size.
Developer and designer Scott Clark is using that loophole for his Ballard Blocks development. The Ballard Blocks is developing an entire city block, but as two separate projects. Together the projects will create 133,593 square feet of commercial space which will be occupied by a Trader Joe's market, a health club, a third retail space, and a 468-stall parking garage. Clark declined to be interviewed for this article.
The development is bordered by Northwest 46th Street to the south and 14th Avenue Northwest to the east, two important freight corridors for industry in Ballard.
The North Seattle Industrial Association raised the issue of loophole during the permitting process, but with no success.
The 75,000 square foot commercial space allowance on certain industrially zoned land is "a big incentive" for commercial developers, said Barry Hawley, longtime Ballard real estate agent.
"There's no room for commercial development in Ballard because of mixed-use development," said Hawley. The mixed-use developments typically only have "token commercial" space. "Any place you can put residential in density in Ballard is too expensive for commercial."
Retailers then turn to industrial land.
Development is not the only source of pressure. Land speculation has driven prices up in Ballard more so than anywhere else in Seattle, said Hawley. Non-industrial development in industrial zones encourages investors to buy land in anticipation of zoning changes in the future.
"This speculation of a change in zoning increases demand for the land, and drives prices upward," states a preliminary industrial land use study conducted by the Planning Commission in 2005.
While waiting for zoning changes, investors lease land to short-term tenants who can be easily and cheaply replaced with more profitable long-term development. There are several such sites in Ballard, according to multiple sources.
"People can get priced out of an area. That's what happens when people see they can make more money using their property in other ways," said Hawley.
But it is not simply an issue of one business replacing another.
"These things are all tied together, and you can't have the fishing industry without those support services, whether it's an oil dealer or somebody who makes specialized equipment you used on a fishing vessel," said Sommers. "You need the whole cluster to keep any part of it."
"Why send these businesses out of town if we have the land?" asked Steinbrueck. "We should not unwittingly put [the maritime industry] at risk....[Its] blue-collar working jobs are some of the best and most stable we have."
Almost 10,000 of the 22,000 jobs in the maritime industry are located directly on the city's waterfront, according to the Planning Commission's preliminary study in 2005.
Industry leaders believe maritime businesses will survive as long as their waterfront location is protected.
"If we're allowed to retain the industrial zoning, we won't have a problem," Phillips said.
Dan Catchpole may be reached via bnteditor@robinsonnews.com
Dan Catchpole