Item No: 8e_Supp Date of Meeting: February 26, 2019 T-91 Uplands Development Design Funding February 26, 2019 New Development at Terminal 91 • • • Requesting authorization for overall master planning, environmental review, permitting and Phase I design located at the northeast end of Terminal 91 Uplands Total authorization to date to $4,300,000. Part of 2019-2023 Capital Improvement Plan 2 Terminal 91: Many Attempts to Develop Uplands • • • 2000: Harbor Development Strategy 2004: North Bay plan proposed mixed use (including biotech) 2012: Proposed mix of light industrial buildings and yard leases (considered parking garage and office building) - Proposed ground lease to 3rd party developer - Challenged with cost of infrastructure Lots of Effort - No Substantial Uplands Development 3 T91 Uplands - Maker District Actions Tent camp 5 1. Determine cost of utilities and infrastructure needed to support new development 2. Develop master plan to guide Uplands development 3. Work with stakeholders allow for the opening of the north gates. Image Credit: Heartland Port Real Estate Strategic Plan (2016) Focused on "Maritime Makers" 4 Terminal 91 Uplands Infrastructure Study Square Footage of Building Development Infrastructure Costs Phase 1 100,000 $700k Phase 2 300,000 $5M Phase 3 300,000 to 600,000 $28.3M TOTAL 700,000 to 1,000,000 $34M P1 • Off-site connection to City sanitary sewer to north • New Port electrical transformer & communications pedestals • Minor natural gas relocation P2 • New sanitary sewer main sized for full 1 million sf development • New regional storm drain water quality treatment facility • New Port electrical transformer P3 • Construction of central arterial access road & associated utility corridor • Replacement of existing 42" storm drain main within western development footprint with new pipe in utility corridor • Add cooling fans to 2 existing site electrical substations to increase site power capacity (by Seattle City Light) Defining Utilities and Infrastructure Needed to Support Future Development 5 Developing Facilities for Maritime Manufacturers & Suppliers • Supports growth of commercial fishing and Maritime Cluster o Industrial property in Ballard/Interbay area in short supply o Rising rent costs and high building sales prices o Fishing and maritime manufacturers and suppliers want space at Terminal 91 "The limited supply of industrial property in Seattle in general, and Ballard Interbay in particular, is resulting in rising rents and building sale prices. The Port is in a position to relieve some of this pressure while supporting the fleet and the maritime industrial sector by developing additional industrial space..." Fishermen's Terminal Real Estate Demand Study and Fishing Cluster Economic Growth Model Madison Bay Commercial (12/15/15) Supporting Maritime Cluster in Ballard/Interbay 6 Types of Companies Interested in T91 • Demand for space continues to be very strong: o Seafood processing equipment manufacturer o Fishing gear manufacturer and supplier o Fishing vessel processing equipment manufacturer o Fishing/Cruise industry refrigeration supplier o Cold and dry storage warehouse 40-50,000 sf 30-40,000 sf 40-50,000 sf 50,000 sf 100,000 sf o Local plastics manufacturer o Data Center 50-100,000 sf 2 acres Significant Demand for Light Industrial Facilities from Maritime Companies 7 Tenant Leasing Steps & Timing • Today's action will generate new/renewed interest • Staff will follow up with prospective tenants and negotiate leases as construction unfolds Leasing Steps/Strategy 1. Finalize and permit new buildings and start construction on-site 2. Complete underwriting and rental rates 3. Develop list of prospective tenants and size/infrastructure needs 4. Identify best user/covenant criteria 5. Sign initial leases during construction period Leases will be finalized prior to completing construction to allow for tenant specific fit-outs 8 Major Phased Development Plan • Unique permit in Seattle land use code • One land use permit provides up to 15 years of construction authorization • Applies to multiple developments phased over time on one large site Master Phased Development provides flexibility in design, permitting, and construction 9 Terminal 91 Development Schedule Maritime/Economic Development Project T-91 Uplands Development Design Funding Project Sponsor Project Manager Economic Dev Division Tim Leonard Project Complexity 2018 2019 2020 2021 2022 2023 Q1│Q2│Q3│Q4 Q1│Q2│Q3│Q4 Q1│Q2│Q3│Q4 Q1│Q2│Q3│Q4 Q1│Q2│Q3│Q4 Q1│Q2│Q3│Q4 3 * Community engagement tasks will vary by project needs Community Engagement* Environmental Review Commission Approval Planning/Design Construction 10 Community Engagement and Communications • Robust community outreach and communications efforts will augment the EIS. • Outreach will keep a wide range of stakeholders informed about schedule, design scope, impacts, etc. • Liaison work will continue with transportation planning teams from the City of Seattle, METRO and Sound Transit 11 APPENDIX 12 HISTORY • • • • • Terminal 91 Late 1800's - Intertidal marsh land 1913 to 1917 - Piers 90 & 91 constructed (originally called pier 40 & 41) WWII - Navy acquires for Supply depot 1974 - Port re-acquires terminal from Navy 1974 to Present - Facility used to support a number of maritime cargo and fishing related services such as cold storage, moorage, automobile imports, fish processing, light manufacturing, fuel tanks, open storage and a cruise terminal ZONING AND DEVELOPMENT • • Zoning is IG1 - U45 - This means the facility is allowed to support any industrial activity. Critical Areas (ECA) - T91 lies within the liquefaction and Steep Slope geography of the ECA. PORT UPLANDS DEVELOPMENT PLANS/ATTEMPTS • • 2004: North Bay plan proposed mixed use (including biotech) 2012: Proposed mix of light industrial buildings and ground leases but NPV negative due to needed infrastructure investments 13 T91 Uplands - Phase 1 Redevelopment 14 T91 Uplands - Phase 2 Redevelopment 15 T91 Uplands - Phase 3 Full Build Out 16 Real Estate Development Work @ T91 • Completed comprehensive infrastructure analysis in 1/2018 • Completed initial masterplan study for 1M SF of light industrial development • Prepared Commission request for design funding of Phase 1 of 100k SF • Engaged in ongoing discussions with Expedia on future transportation impacts • Engaged with SDOT regarding re-evaluation of existing Magnolia Bridge • Engaged with Sound Transit on future Interbay/Ballard transit line location 17