EVERETT — The Port of Everett has terminated its contract with a Chicago developer, scrapping plans for a $400 million redevelopment on the Everett waterfront, officials said Tuesday night.
The project had long been in doubt after the developer, Maritime Trust, filed for bankruptcy for the project and failed to pay the port money it owed. But things were in limbo after a Chicago bankruptcy judge prevented the port from taking action on the development.
Jerry Heller, the port’s chief administrative officer, said that late last month, the judge lifted the decision against the port and ordered Maritime to pay it $770,000.
When the payment wasn’t forthcoming, the port terminated its development contract, Heller said.
The contract called for building as many as 660 waterfront condominiums in several phases as well as a number of commercial buildings for offices, restaurants and other businesses.
“It’s interesting that the feasibility of this project depended on a real estate bubble,” Michael Hoffmann, chairman of the port commission, said Tuesday. “It would have been disastrous for the community if that moved forward.”
Hoffmann said the port should look at what to do next with “a primary focus on what the community is interested in.”
Port Director John Mohr noted that the bankruptcy case still continues, but that the port believes it can now look at the future because it now longer has to abide by the contract with Maritime. It had been legally prevented from talking to other developers while the agreement was still considered valid, he said.
He saod that the poor economy means the port can take its time deciding what to do next.
“We don’t want to act in a precipitous manner in a rush to do something, particularly with the state of the economy,” he said.
Mohr said he wants to consult with the city to see what’s possible under the permits the port has already secured for the project.
The Maritime Trust project, because of its emphasis on waterfront condos, had attracted some critics.
Jeff LaLone, co-owner of Bayside Marine on the waterfront, said he hopes the port will reconsider what to do with the property.
“A lot of people looked at that as having a few too many condos there and not enough green space,” he said. “I’m glad to see you want to have some important conversations about what people think about what was going to happen there.”
Port Commissioner Mark Wolken said it will be important to completely re-evaluate the property.
“I don’t think it’s buildable,” he said of the condo proposal. “Instead of looking just at the pure dollar return, we should look at the benefit for the long-term development on the community.”
He agreed with Mohr that he’d like to see what’s possible given the permits the port has already received. “If we can stay inside the box that has already been approved, there may be some benefit in that,” he said.
Troy McClelland, also a port commissioner, said the commission needs to have a “clearer understanding of the timeline of finishing the termination.”
Mohr said it will take about three to four months to look at the issues and report back to the commission in enough detail that it can begin looking at how to proceed.
He noted that the commission should rethink whether it wants to look for another development partner or take over the project and do it in stages.
“Termination allows the port to look forward on all the options,” Heller said.
He noted that the bankruptcy case seeks damages from the port, but he expects those claims to be dismissed.
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