Eighty-six of Bellevue's poorest families

$20 million sale allows low-income families to stay at Highland Village

The 86 low-income families of the Highland Village Apartments received good news on the night of Friday, Aug. 5.

The families, many of whom speak English as a second language, were facing eviction by the end of October. That changed Friday.

“Your neighborhood is saved,” said state Rep. Joan McBride, D-Kirkland, before almost being drowned out in the thunderous applause. “Apparently, we don’t need an interpreter to say nobody has to move!”

After public outcry, frantic nonprofit and governmental scrambling and media coverage, the King County Housing Authority plans to buy the apartment complex for $20 million by Labor Day from developer Intracorp, saving below-market housing for 86 families in 76 units.

The announcement that the families would not have to move caused some residents to stand up and dance, while others cheered and clapped. Nearly all of them were wearing blue in solidarity.

Bellevue Mayor John Stokes expressed his pleasure at keeping the families in the city.

“Bellevue is thoroughly committed to affordable housing and we want to make sure you stay a part of our community,” he said at the meeting. “I know it’s been very tough on you the last couple of months, but you really brought this community together. I’m glad we are able to make a tragic thing positive.”

Rents will not increase in the near future and significant repairs will be made in the next year, the King County Housing Authority said.

“This is about a community coming together,” said the housing authority’s Executive Director Stephen Norman. “So don’t stop. Government does best when the people tell government what they should do. Nobody has to move. All the notices to vacate are ‘muerto’ (dead). Nobody’s rent is going up.”

He thanked the developer in an earlier press release.

“For a private business to change its plans in response to community concerns and forego substantial future financial gain is extraordinary and we applaud them for helping us fulfill our mission,” Norman wrote.

Intracorp, the developer who purchased the Highland Village property, plans to sell it for below the appraised value to the housing authority. It had planned to raze the current 12 buildings and erect 87 townhomes selling for between $650,000 and $900,000 each. The developer into a buzzsaw of opposition.

While the property was appraised in the past and reported in other media outlets as worth $14 million, a recent third-party appraiser valued the 4.48-acre property at $22 million.

“The contract price of the land at $22 million is clearly reasonable given the likely returns on cost and capital,” wrote Bryan R. O’Connor, representing O’Connor Consulting Group. “I would expect that any number of developers would be highly attracted to this development opportunity.”

Intracorp sold the property for less than they might have got on the open market.

“They actually may be able to take a charitable deduction,” said Dan Watson, chief development officer for the housing authority.

Intracorp did not respond to the Reporter’s request for comment by Monday afternoon.

The new agreement allows the 76 apartments to remain permanently as affordable housing — and authorizes the low-income families to continue living there.

Rhonda Rosenberg, director of communications for the housing authority, said that major repairs would be made for a year before seeking Low Income Housing tax credits. These would place a financial cap on the apartments (at about 60 percent of the area median income), but she said most of the families already met that criteria and would be able to stay.

“The comparative value of doing this now is a lot cheaper than losing the housing and building it fresh,” she said. “A lot of people want us to put affordable housing clustered together in South County, but we want it equally distributed. We want affordable housing in Kenmore and Woodinville and Bellevue.”

King County Councilmember Claudia Balducci was impressed by the community’s movement and by the governmental response.

“Doing something like this usually does not move this quickly,” she said. “The fact that we were able to pull together and work on this so fast is an amazing accomplishment, and it happened because you all got together and spoke out.”

Bellevue Councilmembers Vandana Slatter and Lynne Robinson also worked with the county and the state and local organizations to make the purchase happen.

Jerry Kroon, executive director of the Eastside Legal Assistance Program, said his organization and other groups such as Jubilee Reach, Eastside Pathways, Sea Mar and Lifespring had been advocates for the families from the jumping off point. He said it was nice for all parties to feel like they had done something good.

“[Intracorp] didn’t know what kind of hornet’s nest they had stepped into,” he said. “And once they found that out, they talked about how to gracefully back out of this. Government agencies worked with them so they didn’t lose their shirts on the thing. It’s nice when everyone comes out a winner.”

Of the $20 million purchasing price, King County Housing Authority is putting in $3.5 million of its own non-federal money with an additional $9.5 million obligation. Watson said that left $7 million total for the city of Bellevue, King County and the state of Washington to help split up the project.

King County Housing Authority plans to complete the acquisition of the property within the next 30 days and renovate the property over the next two years, while keeping the rents at or near their current affordable levels.

Highland Village is located on the Metro Bus Rapid Ride line located on Northeast Eighth Street in Bellevue, one block west of the 148th Avenue Northeast intersection.