Harborside developer asks for second deferral

Published on Thu, Jun 12, 2008 by Tara Nelson

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Harborside developer asks for second deferral

By Tara Nelson

The developer of the long-awaited Harborside condominium project on Peace Portal Drive got what he asked for.

In a special meeting Monday, Blaine City Council granted a second fee deferral request from developer Art Weiner, of Napa, California, to allow him more time to secure financing for his project slated for 715 Peace Portal Way, adjacent to the city’s boardwalk plaza on H Street.
The deferral will allow him to suspend $103,000 in payments to the city for utility, water and sewer connections for up to two years or until the project is completed, if he starts construction within 60 days.
The development – a four-story, 19,000-square foot mixed-use residential and commercial project – was originally proposed by Bellingham developer Rick Osburn in 2005, but was delayed after a rise in construction costs, and sold unfinished to Windstar LLC, of San Francisco, in 2006.

The city had initially granted Weiner a deferral in December, 2007 with the stipulation that he begin construction within 60 days of the approval of the building permit.

Weiner had signed the original fee deferral agreement in December, 2007 with an official approval date of March 6, 2008 allowing him to defer $103,453.

After the deadline arrived on Monday, May 5, without construction, Weiner submitted a letter requesting a 60-day extension citing his difficulty in getting financing to proceed.

In his letter, Weiner told city officials that because of the financial market “melt-down” financing for most condominium projects has been extremely difficult to obtain.

The letter went on to say Windstar was currently seeking financing from two prospective lenders and were hopeful of having a positive response within the next 45 days.

On Monday, mayor Bonnie Onyon asked Weiner if he thought he was reasonably certain that he could see the project through until the end of construction once he secured financing.

“I know in Bellingham there are buildings that are left half-built,” she said. “I just want to be sure you won’t start it without all the money coming in or being approved.”

Weiner responded that he was reasonably certain he could acquire the funding to complete the project. Having the city give tentative approval could help assure lenders as well, he said.

Councilmember John Liebert, however, said development, in general, is a game of speculation and risk and warned the council about trying to “micromanage economic development.”

“We may as well put a stop sign up for development downtown,” he said.

Blaine community development director Terry Galvin recommended the council approve the deferral based on the pioneering nature of the project and also because the developer was caught in the current economic slump.

“The risks are minimal and the benefit it could bring to the community is really extraordinary,” he said. “We’re doing this in a good faith gesture, to work with Mr. Weiner. We know he’s right on the edge of getting that funding.”