Is Edmonds big enough for this man?

EDMONDS – A large man who does things in a large way is making a large mark on this town.

Other developers have built more and bigger buildings in downtown Edmonds than Bob Gregg. But none have done it quite like this multimillionaire.

Gregg’s outspokenness, his building in highly visible locations and his plans to make over a building that some see as epitomizing downtown Edmonds’ quaintness have all made Gregg a larger-than-life figure in this mid-size town that takes pride in looking small.

Top it off with a dramatic arson that burned his under-construction building to the ground, and Gregg’s presence in town has generated a buzz uncommon for a relatively small-scale developer.

He’s been criticized for the size and appearance of his buildings and the way he does business, characterized as either straightforward or reckless, depending on who’s talking.

“We’ve got a guy who knows how to get it done,” said resident Roger Hertrich, a leading critic of Gregg’s projects. “He’s a slick salesman, he plays by as many of his rules as he can. He’s good at it.”

Gregg argues that his projects enhance the city.

“A lot of people want to sit there and criticize, but when was the last time they spent a million dollars or $20 million to improve something?” he asked.

Gregg’s attitude toward his critics alternates between defiant irritability and jocular civility.

“It’s like if you’ve ever seen two lawyers go at it in court, and as soon as court’s over, they say, ‘Hey Fred, are we on for golf this week?’” Gregg said.

Gregg is drawn to development partly by the legacy he feels he is creating with long-lasting structures.

About five years ago, he left the last of several corporate jobs to focus on development,which he had previously done only on the side.

“Buildings have some permanence,” he said. “My kids’ kids will be able to say Dad and Granddad built those.”

Gregg, 54, stands 6-foot-3 and walks with a limp from an ankle injury suffered in a motorcycle accident more than 20 years ago. He talks with a deep, sometimes booming voice, laughs easily, has a weakness for pricey foreign cars and enjoys travel with his wife and two teenage sons.

He’s lived for most of the past 25 years on the Puget Sound shoreline in north Edmonds.

“For a guy that started off polishing bicycles for four bucks an hour, you know, it’s darn good,” he said.

Building brouhaha

Gregg has built only two buildings in Edmonds, but the second helped set off a tempest over building heights in the downtown core.

Gregg’s first Edmonds building, MacGregor Place at 427 Fifth Ave. S., didn’t generate much opposition.

But in 2004, Gregg won approval for The Gregory, a three-story, 90,000-square-foot, $12 million mixed-use building at 505 Fifth Ave. S. The building is across the street from MacGregor Place.

It’s being built on four lots that formerly contained a drab Chinese restaurant, a vacant lot, an auto-repair business and a small Victorian-style home.

Gregg was allowed to build on part of a single-family lot in exchange for leaving a 45-foot landscaped buffer behind The Gregory.

The deal increased the square footage of the building and chafed activists, who are as concerned about bulk as height. They wanted pitched roofs for buildings more than 25 feet tall.

Edmonds attorney Steven Bernheim, who filed and won a lawsuit that stopped another three-story building, said he and others are not opposed to all larger buildings.

“We just don’t want them on Fifth and on Main,” Bernheim said of downtown Edmonds’ two primary commercial streets.

All three of Gregg’s Edmonds projects – including a makeover of the cherished Old Milltown mall – are located on Fifth Avenue S.; his company is called Fifth Avenue Development.

“I support more intensive development within walking distance of that shopping core,” Bernheim said. “But it’s a shopping core, not a living core.”

Buildings should be shorter in pedestrian areas to allow for more light and less shadow, activists contend.

Gregg argues passionately for what he sees as the value of The Gregory to the city. He said he spent several hundred thousand dollars on design and a brick-and-cedar facade for the building.

“And I will not back down to anybody that says that that old Chinese restaurant and the derelict auto-repair shop and the vacant lot on which they stored derelict cars is more charming and quaint than what we’ve done,” he said.

Gregg has built 12 buildings altogether, including warehouse-office, light manufacturing, retail and mixed-use structures. His largest residential project, done in conjunction with Conner Homes of Bellevue, was a six-story condo project near Green Lake in Seattle. The project drew pickets, protests and lawsuits.

“When the press talks about this building being controversial, I just smile,” he said of The Gregory.

But shortly after 3 a.m. Dec. 17, 2005, The Gregory lit up the dark night sky with a spectacular fire, sparking speculation about controversy-fueled arson. The building was 80 percent complete at the time.

Authorities later determined the fire was indeed deliberately set, not by an enraged citizen but by young men looking for a thrill.

Two Everett men pleaded guilty to arson and are scheduled for trial next month. A third suspect, a 17-year-old boy at the time of the crime, is scheduled for trial later this month.

When Gregg heard about the fire, he was at the Seattle-Tacoma International Airport getting ready to fly to Belize. He was paged over the public address system and asked to call 911. He learned there wasn’t much he could do until the scene had been investigated, so he continued with his trip.

The Gregory is being rebuilt in its original location and is expected to be finished by the end of this month.

Gregg has been reimbursed $5 million on his $6 million insurance policy and has a lawsuit against his insurance company awaiting trial to claim another $800,000, he said.

Prices on the condominium units, originally averaging $430,000, are being raised by an average of 20 to 25 percent, Gregg said. Last year, 15 buyers of condos in The Gregory sued Gregg and a real-estate marketing company for intended breach of contract.

All but one of the 15 parties to the suit agreed in January to have it dismissed in exchange for the two companies declining to seek attorneys’ fees.

Old Milltown controversy

Last July, Gregg bought Old Milltown, the 107-year-old former auto-body shop that was converted into an indoor-outdoor shopping mall in the 1970s, for $3.2 million. He plans to spend about $3 million more to refurbish it.

Gregg wants to completely gut the building, install office and retail space, and replace brick-and-wood facades with stucco and tile.

“It’ll be class A space,” he said.

Resident Elisabeth Larman, a professional interior designer, and Hertrich filed an appeal against the project with the city.

“It’s an ugly box, it’s very plain, it’s very utilitarian,” Larman said at the time.

The City Council last fall upheld their appeal and denied Gregg’s project. Gregg followed the city appeal process and filed suit in Snohomish County Superior Court.

Meanwhile, he scaled back the plans slightly and the remodel was approved, but he has not dropped the lawsuit. He’s seeking attorney fees and compensation from the city, Larman and Hertrich for any losses resulting from the delay.

Gregg said he’s not averse to the sparring that his projects have engendered.

“I get accused of actually liking it,” he said with a laugh.

Because of the extensive renovation involved, Gregg gave business owners on month-to-month leases a deadline of Sept. 30 to be out. He said he offered them the chance to move back with the rent to be raised from $12 a square foot to between $24 and $30 per square foot.

Some of the merchants felt they were treated fairly by Gregg, some didn’t. One of the latter was Sharon Shannon, owner of Ambience, which carries home accessories and gifts.

Shannon and Gregg give differing versions of how she wound up leaving and moving to Fourth Avenue S.

“I think he has an immaturity about him that makes him say things without thinking them through,” Shannon said. “He’s kind of like a big jolly boy with a toy box full of money.”

Gregg refers to Shannon as “logically challenged.”

Shannon stressed that she hopes she can someday see the good in Gregg.

“Let’s think good thoughts for that piece of property we’ve treasured for many years and move forward,” she said.

Gregg said he was offered Old Milltown a few years ago and turned it down. He said the building, once afflicted by pollution from the auto-body shop, is far from being up to code and has too much common space to be economically viable.

“If there ever was a building that coulda, woulda, shoulda been condemned, that was it,” he said.

Last year, he was offered it again and this time accepted.

“Fishermen like to fish, gamblers like to play cards and developers like real estate,” Gregg said.

“Enough things had changed that we said, ‘This could be a very interesting renovation project.’ That’s what this town seems to be begging for. I was looking for a medal, maybe. I didn’t get it yet, but I will, you wait, you’ll see,” he said with a chuckle.

From bikes to buildings

The son of a surgeon, Bob Gregg grew up in Lake Forest Park. He received a degree in zoology from the University of Washington in 1974 and immediately went to work at his uncle’s bike shop, Gregg’s Greenlake Cycle.

He and his cousin eventually bought the shop from his uncle and branched into motorcycles.

Gregg moved on to become an executive with Metzeler motorcycle tires; executive publisher of Cycle World Magazine; president of Tucker Rocky Distributing, a motorcycle parts company; and president of Norfox, a software company.

Tod Turner, who was CEO of Norfox, originally wrote software for Gregg’s motorcycle shop. He hired Gregg to run Norfox, which has since been sold.

“Everything he touches, he has done well at,” Turner said of Gregg. “He does first-class stuff. I’ve never known him to do anything any other way.”

Greg Arnold, a distant relative of Gregg’s, worked with him at Metzeler and Norfox.

“He’s one of those people who has the ability to see the really simple answer to complex things and come up with the essence of what needs to be done,” Arnold said.

As a full-time developer, Gregg has also proposed a public-private partnership with Edmonds to spur renovation of downtown retail buildings, and he nearly bought the former ARCO property across the street from Old Milltown.

The first idea met with some enthusiasm but was dead on arrival with some city officials.

Gregg said he was beat out for the ARCO property at the last minute by a bid from the Bank of Washington, which plans to build a branch there. Gregg planned to build a two-story building with retail and offices or residences.

In most cases, though, Gregg and other builders believe they need three stories to make money and pump more life into downtown Edmonds.

Some, like Bernheim, say downtown is doing perfectly well the way it is. Others, such as City Councilwoman Mauri Moore, believe it’s stagnating.

According to Moore, Gregg is the only developer making a significant investment in downtown since tighter restrictions on building heights were approved last year – restrictions that were inspired in part by the backlash to his buildings.

“He’s gambling more on our town than we are,” Moore said.

Gregg rails against the height restrictions but plans to keep on building.

“You don’t expect to end the chess game with all your players still on the board,” he said. “You just expect to win.”

Reporter Bill Sheets: 425-339-3439 or sheets@heraldnet.com.