Last week, Vulcan Inc., Paul Allen's property company, pledged $10 million to help build a park along Westlake Avenue North and Valley Street. "With the generous help of Vulcan," Nickels acclaimed, "we're going to create a magnificent park."
The fine print about Vulcan's "contribution," however, makes it clear that Vulcan isn't being "generous" at all. In fact, just the opposite: They're getting a hefty discount on an outstanding obligation to the city.
In 2001, Vulcan bought city-owned land in South Lake Union for $21 million, a promise to build affordable housing, and a pledge to build a 20,000-square-foot cultural facility (defined as something like an arts center, a museum, or a library).
Vulcan hasn't built the affordable housing yet. As for Vulcan's commitment to build the 20,000-square-foot cultural facility? That's where last week's "contribution" comes in.
The $10 million deal stipulates that the Vulcan money come in two installments. A $5 million installment will come only after the city makes improvements to Valley Street as part of a $70 million Mercer Street/Valley Street revamp. More important, another $5 million comes with this caveat: The cash counts as Vulcan's fulfillment of its obligation to build the aforementioned cultural facility. So, this isn't a "contribution." It's Vulcan renegotiating the terms of a long-established business deal.
Worse, it appears the new terms will put money in Vulcan's pocket. Five million dollars is cut-rate for a 20,000-square-foot facility. The Yesler Community Center, a 20,000-square-foot building that opened last month, for example, cost nearly $7 million. And the average cost of new community libraries like the Beacon Hill, Greenwood, and Capitol Hill branches is $475 per square foot. At that rate, a 20,000-square-foot community center could cost about $9.5 million.
Despite these numbers, Team Nickels told me a South Lake Union facility would have cost between $2 million and $2.3 million--a Pollyanna-ish estimate based on construction costs of about $100 per square foot. That may be the going rate on Planet Nickels, but developers tell me barebones costs for this sort of facility are $150 to $200 per square foot. And again, those community libraries (one of the things the city recommended Vulcan build to meet its obligation) came in at $475 a square foot.
Despite the reality, Team Nickels is insisting this is a win for Seattle. But taking Nickels' word seems like a bad idea. Given that the mayor starts from the premise that Vulcan's $5 million was a generous "contribution" rather than the fulfillment of an existing obligation, I'm not ready to trust Nickels when it comes to placing a value on things.
