A $112 million Seattle hotel expansion hits a snag

Developers of a $112 million expansion of the Sheraton Hotel & Towers in Seattle are racing the clock to submit plans for promised improvements to the west side of Seventh Avenue, one of downtown's ugliest blocks. The developers thought they had another 18 months, but city officials are holding them to a timetable that a plan be submitted before a certificate of occupancy is issued. Without that certificate, guests cannot use the 421 rooms inside a new 25-story tower. But despite the timetable, developers and city officials expect the expansion will open as planned on June 8. City officials acknowledge that the Sheraton expansion has not gone as expected. With the hotel all but completed, the city's leverage to secure improvements to Seventh Avenue has diminished and the scale of the improvements has shrunk. "To a certain degree, our hand is being forced here," said Lyle Bicknell, a senior urban designer with the city. At 1,253 rooms in all, the hotel after expansion will be the largest in the Northwest. The hotel occupies the entire block bounded by Seventh Avenue on the east, Sixth Avenue on the west, Pike Street on the north and Union Street on the south. The backside of the hotel is a two-story windowless wall of concrete that runs the entire length of Seventh. It's ugly. That area of downtown has struggled with two of the worst challenges to urban design: giant hotels and even bigger, bulkier convention centers. When the Washington State Convention and Trade Center expanded across Pike Street, the city council approved a soaring glass-and-metal arch intended to give the area a "sense of place" and provide comfort to pedestrians. Some called it a neat solution, others called it a gimmick. In any case, the neighborhood remains a test bed for the city's ability to impose appropriate design requirements and to make them stick. So far, the Sheraton is a tale of frustration. When developers proposed the tower in 2004 to expand the Sheraton, city officials saw a chance to fix blight on Seventh Avenue caused by the original hotel, built in 1982. The hotel wall runs immediately west of the elegant Eagles Auditorium, home to A Contemporary Theatre. In 2005, the city gave approval for the expansion based on an assumption that a local improvement district (LID) would be formed by surrounding property owners to finance significant improvements to both sides of Seventh Avenue. That didn't happen. Jerry Anches, one of the developers of the expansion, says efforts to form the LID failed because it was too difficult to work with multiple boards involving his group, the convention center, and other property owners. Nonetheless, his group is moving forward on its commitment to make improvements to the west side of Seventh Avenue. The block will get more than $1 million worth of landscaping designed by Gustafson Guthrie Nichol, a widened sidewalk, seating, improvements to a pocket park, a water feature, and a major art work by Ginny Ruffner. "We've put an awful lot of effort into finding a solution to the streetscape," said Anches. Bicknell says the city's handling of the Seventh Avenue issue is atypical. Usually, a developer must get approval of all major design features before a project goes forward. That's the point where the city's negotiating leverage is strongest. In this instance, however, the city was persuaded that the expansion and the street improvements should be handled separately. City planners agreed to wait for the LID and the grand plan that would emerge. But by the time it was clear no LID was coming, hotel construction was already going forward. Anches says his group always had the option to move forward without the LID so long as the hotel side of Seventh Avenue got improvements. City records from 2005 confirm he did have that option. The expansion is a partnership that includes Anches, MetLife, several Seattle investors, and Starwood Hotels, which operates the Sheraton. Anches, who was a member of the group that did the original Sheraton, acknowledges the wall along Seventh Avenue is "unsightly and problematic" but says the city will be pleased with the improvements that are coming. Anches and city officials agree that, for now, the developers do not need approval for the street plan to obtain permission to occupy the new hotel rooms. They only need to submit a plan, which will be reviewed by the city's Design Review Board. In a last opportunity for leverage, the city will likely require that the developers obtain a performance bond to ensure that street improvements get done. "We'll make a good faith assumption, backed by the bond, that the improvements are going to be made," said Bicknell. "We realize they've got a hotel to run and we assume they've got reservations for those rooms."