Matthew Jarvis’s most recent commentary “$2 million Question for City Officials” is an example of the passionate dialogue and civic engagement that makes this city great.
In the past we’ve debated the merits of his ideas, such as calling for the closure of the popular and highly successful Federal Way Community Center. While there is plenty of room to debate the city’s policy of investing in downtown revitalization, his letter does include a few inaccuracies and omissions that should be addressed.
In November, after months of work by the mayor’s Office, the city council voted 6-1 to approve the $8.2 million purchase of the 7.48-acre downtown site. The parcel is important to realizing residents’ vision of a revitalized downtown because it connects the adjacent Federal Way Transit Center and the Performing Arts and Conference Center sites with the Town Square Park.
Residents have longed for a downtown to drive to, rather than just drive through. In creating a 21-acre core site that includes live arts and entertainment, conferences, the popular downtown park, public transit and parking, and the potential for 8 acres of new development, we are on the cusp of creating that desired downtown.
Matthew’s comments, however, don’t address the substance of the city’s policy of investing in the downtown. Hopefully, he has more than his “poker tells” to support accusations that two well-known local developers engaged in a fraudulent bid on a property.
Here are the facts, many of them previously and accurately reported in the Mirror (including “More Details Emerge in Federal Way’s Purchase of Former Target Site, Dec. 4, 2104). On June 3, 2014 the city council voted unanimously to green-light construction of the Performing Arts and Conference Center, a move that will stimulate more than $60 million in construction-related spending in the downtown core.
The owner of the Target site saw that his adjacent property was now more valuable than the approximately $6 million he’d previously been seeking. (The price had declined from the $7 million he paid for the property in 2007 before the recession sank the real estate market). He replaced his commercial broker and began looking for a higher price.
Wei Zhang of Winston Investments, LLC submitted a bid of $8 million. Mr. Zhang had recently purchased the “Pal-Do World” site (Desert Industries) for $12 million. With a portfolio of regional investments and global investments, Mr. Zhang and Winston Investments are solid, reputable commercial investors and developers.
The city then moved to beat out the Zhang offer with an improved price because the site is critical to controlling our city’s destiny in developing a downtown all residents can take pride in.
It doesn’t take a financial analyst to know that in commercial real estate the price of the property is determined by the current market, not a four-month-old offer and not an appraisal. Matthew may believe in his heart that Winston Investments and the property’s former owner and commercial broker engaged in fraud to inflate the price of the property, but the facts and the Mirror’s previous reporting shows that the market drove the price.
Chris Carrel, city of Federal Way
