Clock ticking on Summit Place purchase and sale agreement between King County and YarrowBay
By DENNIS BOX
Covington Reporter Editor
February 11, 2010 · Updated 5:33 PM
The deadline for the completion of the purchase and sale agreement for the Summit Place property is fast approaching, and it appears someone is going to blink by Feb. 20.
King County Executive Dow Constantine’s office has been negotiating with YarrowBay, The Kirkland-based developer, over the purchase of the 156-acres at 22801 S.E. 272nd St., which is located inside the city limits of Maple Valley, but is owned by King County.
The county currently has a roads maintenance facility located at the site.
The purchase price for the land is $51 million with phased payments made over a period of years.
According to Sung Yang, director of government relations for Constantine, the contract calls for YarrowBay to pay $1.75 million in earnest money by Feb. 20.
YarrowBay has been seeking a one-year extension to wrap up the purchase and sale agreement and according to sources, the executive’s office informed YarrowBay the extension would cost $2.5 million, added to the purchase price of $51 million, but paid in the last installment.
Yang would not confirm the request for $2.5 million, but he did say any request for an extension from YarrowBay would mean the county would, “have to take into account the ongoing costs the county incurs under the purchase and sale agreement.... We have to make sure the county is whole.”
Yang said the county is in the process of designing a new maintenance facility in anticipation of the sale.
Sources close to the negotiation have stated YarrowBay may walk away from the project, leaving the county without the $51 million payment. There is no financial penalty if YarrowBay withdraws from the agreement up to Feb. 20, other than their own costs.
According to Yang, YarrowBay could have opted for an extension to August for $50,000. The deadline for that payment was Jan. 21, and YarrowBay let it pass.
Yang stated, “that would be unfortunate,” if YarrowBay decides to walk away from the project.
“We have a purchase and sale agreement that protects the county,” Yang said. “It protects the people who own it, the citizens of King County.”
Yang said the executive’s office would, “still like to see this development occur.”
Maple Valley’s principal concern with Summit Place is the land be annexed into the city prior to construction of the project. The city is seeking some control of the development and the fees from construction.
The County Council passed a resolution in November 2009 requesting the executive to negotiate an extension with YarrowBay and “1. That no application for development will be filed by the county or the developer until after annexation of the property into the city of Maple Valley has occurred; and 2. That a date certain for annexation will be set, such that legislation for annexation of the property into the city will have an effective date no later than August 1, 2010.”
The city’s concern is this resolution is non-binding and YarrowBay could begin developing the project in the county without annexation after Feb. 20 if it pays the earnest money.
Maple Valley Mayor Noel Gerken said, “if that happens it would be disastrous. That is what we are worried about.”
YarrowBay representatives have stated they want the land annexed into the city before development of the property begins.
Yang said the county negotiators, “want to honor the guidance provided in the resolution.”
There are sources close to the negotiation that are concerned the $2.5 million request may not be in the spirit of the resolution from the county and if YarrowBay walks away the county will be left with a $51 million hole.
It is within the executive’s right to negotiate this agreement and refuse to sign the contract if he believes it is not in the best interest of the county.
Yang stated at the end of the day an extension to the purchase and sale agreement, “can not be at the county’s expense.”Contact Covington Reporter Editor Dennis Box at email@example.com or 1-425-432-1209 (ext 5050).