Template revised April 12, 2018.

DATE: March 29, 2019

TO: Stephen P. Metruck, Executive Director

Request adoption of Resolution No. 3757: A Resolution of the Port of Seattle Commission

amending Unit 20 of the Comprehensive Scheme of Harbor Improvements of the Port of Seattle

(Lower Duwamish Industrial Development District) by: (i) declaring certain real property surplus

and no longer needed for Port district purposes; (ii) deleting said property from Unit 20 of the

Comprehensive Scheme; and (iii) authorizing the Executive Director to take all necessary steps

and execute all documents for the sale of such real property to West Coast Self-Storage Group,

LLC.; amending Resolutions No. 17, 2769, and 2805 of the Port of Seattle Commission.

EXECUTIVE SUMMARY

Staff is requesting that the Commission sell a small parcel of Port owned property on Harbor

rail spurs prohibit direct access from the site to T-5. The site is also too distant from the Port’s

CEM and Pier 2 properties to tangibly support development of these sites.

Port staff has attempted to lease this property on several occasions for parking and other

potential developments; however, it has not generated any interest. The site’s small size and

uneven topography make it difficult to market. For these reasons, the site has not produced

any income to the Port since its purchase.

The public hearing and first reading for Resolution No. 3757 was held on March 26, 2019.

Template revised September 22, 2016; format updates October 19, 2016.

purchase and sale agreement with Birmingham Steel Corporation (DBA Salmon Bay Steel

Corporation). The Port properties involved in the exchange were portions of Terminal 105 and

portions of property located on Harbor Avenue Southwest- both within the City of Seattle. This

exchange provided the Port with property required for Burlington Northern rail operations

associated with the expansion and future development of Terminal 5 and the completion of the

Southwest Harbor Project.

This parcel, in particular, was part of a street vacation negotiation between the seller (Salmon

Bay Steel Corporation) and the Port. The transaction exchanging these properties closed on

August 28, 1995 and the Port took possession of the parcel a year later. The purchase price of

The site has not turned out to be a strategic accessory space as the purchase originally

intended. The property does not provide any access to T-5. It is too distant from other Port

properties to be of strategic value.

Efforts to lease the property have been unsuccessful. The site’s uneven slope and small size

limit its development potential. For these reasons the site has not produced any income to the

Port since its purchase.

Given the property’s limited development options, it cannot tangibly support the Port of Seattle

11,579 square-foot parcel in West Seattle at a final agreed purchase price of $699,140. The

buyer, which owns the adjacent property immediately to the north, will ultimately develop the

site as a self-storage facility serving the storage needs of the West Seattle Community.

DETAILS

The Port has obtained an appraisal of the property, which is fully described in the attached Fair

Market Value appraisal report, prepared by Kidder Mathews, dated February 13, 2019. The

subject property also contains an 823 square-foot encroachment area along its southern edge.

The sales price is based on the following:

Template revised September 22, 2016; format updates October 19, 2016.

2.) The unencumbered portion only

3.) The 823 square-foot portion encumbered by the encroachment

As a result of The Port’s investigation and analysis, the market value of the fee simple interest

in the subject is:

Total Subject as of February 13, 2019 ........................................................................... $750,000

Total Subject less Encumbered Area as of February 13, 2019 ..................................... $700,000

Pursuant to the purchase and sale agreement, the buyer agrees to release the Port from any

claims relating to the environmental condition of the property. Upon closing, the buyer agrees

to further indemnify the Port for any claims, including third-party claims, relating to

environmental conditions on the property attributable to pollutants that emanate from buyer’s

adjacent parcel.

ALTERNATIVES AND IMPLICATIONS CONSIDERED

Cons:

don’t need.

This is not the recommended alternative

Alternative 2 – Develop Harbor Ave Property

Template revised September 22, 2016; format updates October 19, 2016.

Cons:

(1) Requires major Port investment of funds

(2) Requires an increase in costs due to increased number of consultant procurements

and construction mobilizations

(3) Requires additional staff time and costs to manage individual design and

construction effort for a small property

This is not the recommended alternative.

Alternative 3 – Sell Harbor Avenue Southwest property

(1) Requires Port to sell existing property in industrial zone

(2) Requires reduction of existing area available for on-site open storage

(3) Requires reduction of existing land available for lay down area for various port

projects in the vicinity

ATTACHMENTS TO THIS REQUEST

Template revised September 22, 2016; format updates October 19, 2016.

Agreement with Birmingham Steel Corporation for the exchange of four separate properties,

including the Harbor Avenue Property (Parcel No. 798740-0020).