Seattle’s Latest Industrial Plan Will Exclude Housing, Erect New Walls Around Industrial Districts

Evolution Block in Vancouver, B.C.—the kind of multistory industrial building that could come to Seattle under a new proposal for industrial areas. Photo via PC Urban.

by Erica C. Barnett

Walk through the stretch of Ballard that runs roughly from 14th to 8th Ave. NW between NW 53rd Street and Leary Way, and you’ll find no shortage of breweries and taprooms selling hoppy IPAs and farmhouse ales to take home or drink onsite, along with an eclectic assortment of food trucks offering everything from dim sum to burgers to Polish food. What you won’t see is housing: No apartments, condos, or artists’ lofts to break up the area’s single-story industrial monoculture.

The breweries have brought some street-level excitement to this part of Ballard, but the vitality is limited: You can drink beer and buy food from a truck here, but you can’t work in an office, browse in a retail store, or dine at a restaurant—and you certainly can’t live here. Tap rooms (and marijuana shops) represent the limit of what’s allowed in an industrial area like this one in Ballard, which will eventually be a short walk away from Sound Transit’s Ballard light-rail station.

The future of Seattle’s industrial land has been a subject of debate for decades, but the idea of integrating non-industrial uses into these areas, which make up about 12 percent of Seattle’s land, has accelerated in recent years as smaller, more human-scale industrial businesses have replaced smoke-belching traditional manufacturing enterprises in Seattle and across the country. Under a new strategy created at the behest of Mayor Jenny Durkan, however, innovation in these areas would be restricted to small edge zones on the outskirts of industrial districts—and housing would continue to be banned altogether.

In addition to those new restrictions, a proposed amendment to the city’s comprehensive plan (the document that governs land use and zoning in Seattle) would make it virtually impossible to take land out of industrial use for any reason—a zoning restriction on par with laws preserving Seattle’s exclusive single-family zones.

In effect, the amendment would bar anyone who owns industrial land from even asking permission to remove it from industrial use—say, to add housing in an area right next to a light rail station. Historically (including this year), individual land owners have asked permission to change their property from industrial to another use as part of the comprehensive plan amendment process, and historically, including this year, the city has rejected such requests.

On Monday, NAIOP Washington, a lobbying organization for commercial real estate developers, wrote a letter to the city’s Office of Planning and Community Development asking for more zoning flexibility within a quarter-mile of light rail stations and requesting a more flexible definition of “industrial” to allow a wider range of uses. And they asked the city to reject the proposed comprehensive plan amendment. “[W]e do not believe all 5,000 acres of our City’s industrial lands should be treated the same,” the letter, signed by NAIOP Washington director Peggi Lewis Fu, says.

“We believe in some areas, this work could go further… ensuring that this effort fully considers the billion-dollar taxpayer investment in current and future light-rail transit stations that fall within this study area,” the letter continues.

The new recommendations introduce the concept of “high-density employment” in industrial areas near transit stops—multistory industrial buildings that, in some cases, might include office space. In practice, this type of development would encourage a one-way in-migration to jobs and a one-way out-migration to homes, much as 20th-century transit and highway planning assumed people would commute to cities’ downtown cores from distant residential neighborhoods and suburbs.

Jessica Clawson, an attorney at the firm McCullough Hill Leary in Seattle, asked the city council’s land use committee last month to delay considering the comprehensive plan amendment until next year, when the city will have a better idea of where Sound Transit’s new stations in Interbay and Ballard will go.

“Why would the council docket and study a comp plan amendment now that would make it more difficult to consider these really important transportation decisions when making land use changes [in the future]?” she asked. Clawson’s firm is headed by longtime developer attorney (and political heavy hitter) Jack McCullough, who co-chaired the committee that produced the 2017 proposal.

The Industrial Innovation Network—a group of property owners who want to remove their land from industrial use, allowing them to develop it—has filed an appeal to the city’s determination of [environmental] nonsignificance for the amendment, arguing that the proposal would make it impossible for them to develop housing, including affordable housing, in historically industrial areas near light rail stations “In addition, the Proposal’s restriction of land to only industrial uses will cause some properties to remain vacant or underutilized, with buildings in a state of disrepair, resulting in blight,” the appeal, filed by McCullough Hill Leary, says. 

In a letter to OPCD a week before the IIN filed its appeal, Clawson argued that would take away property owners’ rights to “petition their government” for a land-use change, reduce the usefulness of light rail, and contribute to the housing shortage by taking land out of residential use, potentially “in perpetuity.” 

“Locking industrial lands into non-housing use (required by the MIC) will result in significant land use and transportation impacts,” the letter, signed by Clawson, says. In addition to the future light rail station next to Ballard’s brewery district, the SODO Manufacturing and Industrial Area includes a light-rail station that will eventually serve as a bustling transfer point for riders coming to and from West Seattle.

“Locking industrial lands into non-housing use (required by the MIC) will result in significant land use and transportation impacts,” the letter says. In addition to the future light rail station next to Ballard’s brewery district, the SODO Manufacturing and Industrial Area includes a light-rail station that will eventually serve as a bustling transfer point for riders coming to and from West Seattle.

The council voted to move the amendment forward; they haven’t acted on the industrial advisory group’s recommendations, which will face environmental review. The city hearing examiner’s office has the property owners’ appeal on its docket.

Although industrial areas enjoy an enviably low vacancy rate (about 5 percent, compared to an office vacancy rate of 15 percent), the definition of “industrial” continues to shift in ways that have led other cities (notably Portland) to allow some mingling of homes, shops, and restaurants in once walled-off industrial areas. The idea of allowing housing in industrial areas has long been off-limits in Seattle, but the city’s growth—even at the height of COVID, the city grew by 8,400 people, cementing our status as one of the fastest-growing US cities—may force the issue, especially in a city that restricts new apartments to a tiny sliver of its buildable land.

In Seattle, conversations about the future of industrial land have been slow and fitful. In 2016, then-mayor Ed Murray assembled a group of stakeholders—including industrial land owners, planners, developers, and maritime advocacy groups—to come up with a new framework for developing industrial areas in the future. The update was long overdue: Since 2007, when the city dramatically downzoned industrial land by placing strict size limits on office and retail uses, Seattle’s industrial areas have been effectively closed to non-industrial development—a status that keeps land costs lower (no competition with residential and office developers), but can produce dull streetscapes prone to potholes and blight.

“That first [set of meetings] started so contentiously that they couldn’t even have the two sides of the table in the same room for the first three meetings,” SODO Business Improvement Area director Erin Goodman recalled. The argument boiled down to “development version preservation of industrial land—this is a hot button issue down here.”

Eventually, the two sides came together on a plan that would have opened the door to more office and retail space in industrial areas. But the proposal also barred any residential uses, by design, a concession by developers on the committee that “really changed the entire conversation,” according to Manufacturing and Industrial Council director Dave Gering, who co-chaired the committee with McCullough.

The new industrial lands proposal would make it much harder for property owners to remove land from industrial zoning.

In addition to those changes, the 2017 draft recommendations would have imposed strict new parking maximums on office uses, with the goal of encouraging transit use and preventing big-box developments like the Whole Foods/HomeGoods-anchored strip mall in Interbay. A new idea, called the “SODO Concept,” would have specifically allowed “dense” office space and new commercial or retail development as long as new buildings included at least one floor of industrial space—an effort to acknowledge the evolving definition of “industrial,” which cities like Portland have formally expanded to include shared maker spaces, small-scale manufacturing and food startups, and other businesses that aren’t traditionally thought of as “industrial.”

The committee issued its report on September 25, 2017—two weeks after Murray resigned in scandal.

Two years went by with no action. Then, midway through her term, Mayor Jenny Durkan decided to restart the whole process with a new and vastly expanded cast of characters (about twice as many people, including two Royers and a new panel of neighborhood representatives) that retained many of the people who participated in the 2017 process while cutting out most of the developer representatives, including McCullough. The group met a couple of times before COVID hit, Goodman recalls, and then regrouped on Zoom several months later for a “very different” series of conversations centered on workforce development and economic recovery.

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“For the most part, [the proposal] really is about preserving industrial lands for industrial purposes, and so there were definitely still people who were not supportive,” Goodman said. “But at the end, we did have the majority of the people saying, ‘This may not be everything we want, but this is a good place to start. “It was fascinating—I probably would have told you three weeks before we finished that there was no chance it was going to get to consensus,” Goodman added.

The new recommendations, which still have to go through an environmental review, clamp down on office and retail uses in industrial areas to a much greater extent than the 2017 proposal—no more “SODO concept,” and no more parking maximums—while offering a small concession to those who believe residential and industrial uses can co-exist: Under the new recommendations, the city could allow up to 2,000 “caretaker” units citywide where workers can live on site in industrial areas, a designation that could include things like new artists’ lofts and live/work spaces that are not currently allowed.

The 2021 plan, like the 2017 recommendations, would prohibit housing in industrial areas.

Rico Quirindongo, the interim director of Seattle’s Office of Planning and Community Development, puts a sanguine spin on the plan, saying the recommendations “set the table for us to move [the environmental review process] where we will be exploring how we both preserve industrial uses, support the Port, and industry, and workforce, and maritime uses in our port city, while still addressing the future needs for a city that it is hard for us to project.

“I would love to hire a futurist to help us look forward and figure out what we want Seattle to become next,” he added.

The new plan also introduces the rhetorically novel concept of “high-density employment” in industrial areas near transit stops—multistory industrial buildings that, in some cases, might include office space. Many cities, including Vancouver, B.C. and Portland, are embracing this type of development. But in the absence of housing, new job districts tend to encourage a one-way in-migration to jobs and a one-way out-migration to homes, much as 20th-century transit and highway planning assumed people would commute to cities’ downtown cores from distant residential neighborhoods and suburbs.

Industrial and Manufacturing Council director Gering, who describes the new plan overall as a huge win for industry, still has reservations about the small concessions it makes to mixed-use development. For example, Gering says allowing even a few “caretaker” spaces in industrial areas represents “the biggest failure” of the recommendations. “They’re picturing families, kids—this is going to be a backdoor into residential,” he said. “That’s what we’re worried about.” Allowing housing in industrial areas, even on a limited scale, could eventuallly force businesses to meet higher environmental safety standards (cleaner soil, for example), raising the immediate cost of doing business while increasing property values (and taxes).

The gap between what industrial businesses want (more legal protections for industrial land, more barriers to housing and office space) and the things urbanists would like to see more of (apartments above some of those breweries; a more diverse mix of businesses, including at street level) isn’t necessarily unbridgeable. But it will require a mayor (and interest groups) willing to acknowledge that the future may be different than the present, and that preserving swaths of the city for a single purpose has consequences elsewhere. We’re starting to learn this with residential neighborhoods, where the walls around exclusive single-family zoning are starting to come down. It may take many years before we catch up with other cities’ vision of what industrial lands will look like in 20, 50, or 100 years.

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