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Kirkland Council approves Kraken Iceplex and community center agreements with financial guarantees
Summary
The Kirkland City Council unanimously approved Resolution R‑5704 authorizing agreements with Seattle Kraken partners for a privately financed iceplex and a city community center on city land, with an enforceable financial guarantee and annual third‑party verification to limit taxpayer exposure.
The Kirkland City Council on Dec. 9 approved a package of agreements with the Seattle Kraken to develop an iceplex and an adjacent community center on city‑owned land formerly used as the Houghton Park & Ride. City officials framed the deal as a public‑private partnership that preserves city ownership of the land while the private partner builds and initially funds the facilities.
City staff said the land was acquired for $9,000,000, that building costs are estimated at roughly $60 million, and that the Kraken organization will finance construction. “The city of Kirkland owns this land. We bought it for $9,000,000,” the city manager told the council during the presentation, highlighting that the city will retain ownership of the site and ultimately the buildings under the ground‑lease structure.
A central concern for council members was the strength of the financial protections. City Attorney Darcy Eilers described a multi‑layer guarantee that holds multiple Kraken‑related entities responsible and requires annual independent verification of the franchise’s unencumbered equity. Eilers said the adviser will review Kraken and related companies’ audited balance sheets and provide the city a certification; the underlying private records remain confidential. “The adviser is going to be the one receiving records … Those records are never intended to be public records,” Eilers said, while noting the city will receive the adviser’s certification of sufficiency.
The guarantee includes an immediate remedy if the independent review shows a breach of the covenant: within roughly 10 business days guarantors must deposit cash or a letter of credit equal to two years’ rent. Staff emphasized the commitment covers more than unpaid rent and is intended to protect construction, operational, and long‑term lease performance.
Council members debated amendments to the guarantee exhibit before voting. Deputy Mayor Arnold moved to substitute Exhibit K with revised guarantee language; the amendment passed, and the full resolution — authorizing the city manager to execute the agreement to lease, the ground lease upon closing, and related implementing documents — passed unanimously.
What’s next: Staff said SEPA and development plans will follow, with a target for ground‑lease execution in 2026 and a hoped‑for facility opening in 2027 if timelines hold. The city manager told council the city will return before substantial completion to decide whether to acquire the finished facility or continue as landlord under a lease.
