By Tom Hoban Realty Markets
On page 77 of its 2010 annual shareholder report, Kimberly Clark Corp. reported it was budgeting $300 million to $600 million for the closure of its Everett mill and two in Australia. A last-minute deal with a buyer for Everett fell through in late 2011, so they stuck with their stated plan. Now it sits idle and it is perhaps the most talked about piece of real estate in Snohomish County today.
Given its potential importance, Everett officials placed a moratorium on any development or change of land use that Kimberly-Clark might consider. In the first post-moratorium public meeting, Mayor Ray Stephanson made clear he wants jobs and citizens said they wanted a sensitive environmental cleanup. Other suggestions were parks, a museum, tourist attractions, retail, public access and a cruise ship terminal.
This is one of those circumstances where the question is not “either/or.” This site affords an “and” where many things can happen in and around it. That’s because it sits on downtown Everett’s connection to its waterfront. It’s also flat, has abundant utilities, rail links, trucking access and deep-water frontage. Modern day light manufacturing, distributing and other jobs leveraging a deep local labor base would fit nicely. That’s why this site is interesting.
One imagines manufacturing in lower-rise buildings serving a technology-based economy sprinkled with some office and modest retail taking advantage of the distribution and supply chain that rail and trucking provide. With view lines and waterfront access blocked today, city-mandated height restrictions on replacement buildings brings value to downtown as well, giving more appeal to high-density, high-rise housing. Retail follows jobs and housing and that would be expected downtown.
Since it’s privately owned, the city’s only levers on what it becomes are zoning and land-use restrictions. If it wants more control, it would need to buy it. City officials say that’s not an option.
The city has an ace in the hole that government uniquely possesses. By indemnifying some of the environmental and clean-up risk, it could reduce the regulatory and clean-up burden to a buyer and Kimberly-Clark that might make it financially attractive to do something appealing there. In exchange, the city could get some public access. This is a common practice in other communities, but is rarely used where the environmental community holds sway over political decisions, as is the case in Everett.
But Everett is already sitting on a large undeveloped site on its riverfront where it spent millions of taxpayer dollars to clean up a publicly owned site with nothing to show for it yet. Without spending a dime, indemnification in exchange for public access could help facilitate a private-sector deal and it might come to be something much sooner because K-C has budgeted millions to reposition it for another use.
This is the city’s cause, to be sure, which places a high premium on leadership at a time when budgets and resources are thin. The Port of Everett owns the land on both sides of the mill but says it has too much undeveloped land of its own. The building permit process belongs to the city and any benefits to downtown Everett are outside of the port’s core mission anyway.
For these reasons, the city should play its ace early. A cooperative and engaged local government will get the attention of larger developers in an economy where competition is fierce. Leadership will need to be bold, noisy and promotional as it works to pull together environmentalists, labor and a fractious business community to a common vision. Economic Alliance Snohomish County could be a useful partner in such an effort.
Considering a recent run of stalled public projects and the loss of the second Boeing 787 assembly line to South Carolina, Everett needs a big win. Steering some of the $300 million to $600 million of budgeted private funds to what will work for all concerned is a gift in many ways. Working with the Kimberly-Clark’s of the world in a cooperative way is the pattern that has worked best in other American cities where mills have shut down.
Tom Hoban is CEO of The Coast Group of companies in Everett. Contact him at 425-339-3638, firstname.lastname@example.org or [URL]www.coastsvn.com;http://www.coastsvn.com[URL].[/URL]