By KATHY DAY
Herald Writer
New apartment complexes are continuing to rise around Snohomish County even with a vacancy rate above 5.1 percent.
Much of the new construction is concentrated to the south in Bothell and Mill Creek in complexes like Jefferson at Mill Creek. But recently, work started on a 289-unit apartment complex on Evergreen Way in Everett that accounts for nearly two-thirds of the apartments permitted in the city this year.
Permits for the 9.37-acre Everett complex bring the number issued by the city during the past six months to nine, accounting for 458 new apartments. A year ago, eight permits for 164 units had been issued, according to the Everett Planning Department.
In Mill Creek, building department officials are busy inspecting the 445 units that were awarded permits in 1999. The city hasn’t issued a single permit this year, a city official said Tuesday.
In the county’s unincorporated areas, 493 units have been approved for construction, 31 fewer than a year ago.
A report in March from Dupre+Scott Apartment Advisors projects about half as many permits will be issued countywide this year as were granted in 1999 in the face of what it calls "a slowing economy."
Being built by Seattle-based Maestro Properties, the Camelot Apartments on Evergreen Way at 112th Street SW will consist of three four-story apartment buildings and two recreation buildings. When the $23 million complex is completed in about 12 months, rents are expected to range from $635 a month for a studio to $795 for a two-bedroom, two-bath apartment.
Those rates average out to $715 a month, $17 less than the county average of $732 reported by Dupre+Scott. The survey stated rents have increased from $700 a month in March 1999 and $729 in September 1999.
Camelot’s rates are well below the 388-unit Jefferson at Mill Creek project, which the developer calls "an estates apartment community." Three variations of a one-bedroom, one-bath apartment there range from $820 to $1,250 a month with the three-bedroom, two-bath unit topping out at $2,040.
Despite the new construction, Dupre+Scott reported the county’s vacancy rate has fallen since the fall of 1999, when it was 5.9 percent.
Jon Hallgrimson, senior vice president at CB Richard Ellis’ Apartment Group, said recently that although the county "overall is the softest market as far as rents go," improving demographics brought by employees at Boeing and from the high-technology corridor on the east side of Lake Washington have inspired some developers to keep building.
Some, like Jefferson, offer amenities akin to what is offered in Bellevue, he noted.
But if the market gets saturated and the economy slows, vacancies will rise, spelling bad news for those who want to sell their units but good news for renters who will see rates drop, Hallgrimson said.
Tom Hoban, chief executive officer of Everett’s Coast Management Inc., said the new apartments being built can be an opportunity for apartment owners who have units that are good quality and can compete against the fancy new ones. It gives them an opportunity to close the gap between what they are charging and the higher rates, which are about 20 cents a square foot higher in the newer complexes.
But it can also scare those whose units aren’t up to snuff, he said.
Developers building higher-end complexes "are making a play for renters who can’t find space on the east side or north King County," Hoban said.
They’re looking for a lifestyle and are willing to pay a bit more, he added, noting that he doesn’t think they’ll travel much beyond south Everett because of the traffic.
You can call Herald Writer Kathy Day at 425-339-3453 or send e-mail to
kday@heraldnet.com
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