Council postpones repayment obligation to support completion of 24 unfinished apartments at B Avenue

Staff told the council that a 2018 development agreement for 1405 B Avenue West required the developer to complete 60 apartment units by Sept. 1, 2023. Public improvements were completed, but only 36 of the 60 units were finished. Under the agreement the developer became liable for a proportionate reimbursement to the city; staff calculated the current reimbursement obligation as $60,001.08.

Staff presented three options: (1) require immediate payment of $60,001.08, (2) extend the deadline for payment to Dec. 15 to allow the buyer (the Burrells) to close and settle, or (3) postpone repayment and prepare an amendment to extend the construction deadline so the remaining units can be completed. Staff recommended option 3 to maximize housing units available during an ongoing shortage.

Council members discussed the timeline and the new owner's other projects. Staff said the new owners have other construction underway and that a reasonable negotiated timeline could be required if council wanted a tighter deadline. A councilor noted the city's housing study indicates a need for roughly 700 rental units and argued completion of the remaining 24 units serves that need.

Council voted to postpone enforcing the repayment and directed staff to draft an amendment to the development agreement to allow completion of the remaining units. Staff noted the payment obligation and agreement terms would remain enforceable absent completion; if the owner instead pays the $60,001.08, the obligation would be settled rather than amended.

Council asked staff to negotiate a definitive completion timeline when drafting the amendment and to return the proposed amendment to council for approval.