What are two things that Greg Nickels, Mike McGinn, and Ed Murray all have in common? If you said, “Roman Catholicism,” your knowledge of Seattle mayors is exceptional! Another thing they have in common is that, from their City Hall vantage point, each man had (has) the pleasure of viewing from their office the expansive, desolate site at the lower right of the picture below:
The view is very similar to what Seattleites could have seen at 4th Avenue and Cherry Street way back in February 1911:
If anything, the sight of an antique steam-operated shovel would be an improvement on the boarded-up streetscape that exists today.
In 2005, the old Public Safety Building was torn down, and the city sold the vacant 57,000-square-foot lot to Seattle-based Triad Development for $25 million. Triad envisioned a grand replacement for the site: the Civic Square, a $350 million, 43-story skyscraper, including retail, office space, and residences. Its showpiece was a 30,000 square foot plaza. Following a nearly two-year deliberative process by the City Council, the measure was finally approved, and Seattle was set to have a new landmark join its skyline.
That was in 2007. When the global financial crisis hit, Triad’s project financing vanished, and little has happened at the site. Citing a case of “bad timing,” the City Council granted Triad a permit extension until the end of 2015. The company remains optimistic on the project, as it now searches for new investors, be they foreign (perhaps Chinese) or domestic.
How does this fit alongside Sightline’s advocacy for land-value taxes (LVT)? Today, the 4th and Cherry site has a base land value of $28,560,000—a considerable sum, but quite understandable given that the land is prime real estate just blocks away from the historic Smith Tower and Pioneer Square.
Highly valuable land. Prime location. Seattle policymakers now confronted with an alarming rise in rent prices, a sign of a shortage in housing. Yet a large, centrally-located land parcel has sat inactive for nearly a decade. The absurdity rankles.
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But what’s the root cause? In one sense, it seems like a complicated situation, involving city processes, global economics, and the real estate financing market.
Yet it’s hard to see how a situation like this one would persist under a land-value tax. Such a system would raise taxes on idle urban land, while reducing the tax rate on land that’s intensively developed. LVT might not be a panacea for compact urban development. But at the very least it would offer clear incentives for prompt development of properties like the one at 4th and Cherry. And with strong enough incentives in place, all players in the market—from developers to credit markets to potential buyers and tenants—would have financial motivations to get projects like Civic Square moving, rather than sitting idle for a decade.
If completed, the Civic Square will certainly be a place that attracts new business, tourists, and long-time residents alike. But until the expansive plaza is complete, long-suffering city residents will continue to be forced to walk around this chained-up, boarded-off—yet incredibly valuable—plot of land.