On March 23, 2020, Governor Jay Inslee issued the Stay Home, Stay Healthy Proclamation (20‑25) in response to the COVID-19 pandemic. Originally, the Proclamation was to be in effect through April 8, 2020. Despite Washington’s aggressive efforts to flatten the curve, on April 2, 2020, Governor Inslee announced his decision to extend the Proclamation through
An Owner’s Guide to Accessibility Claims in Washington
When owners engage architects and accessibility consultants to design their projects, they naturally expect good design, but they must also be sure the design provides all users with the practical ability to use and enjoy the end result. Civil rights acts such as the ADA and Fair Housing Act were enacted to provide certain protected
Design-Build Lite – Construction Contracts with D-B Components
For most in the industry, when we think about a standard construction contract, we envision the construction documents being drafted by the architect and other design consultants. We tend to view the project as design-price-build, unless an alternative procurement mechanism has been selected such as design-build. Consistent with this design-price-build model, the contractor’s review of
Stoel Rives Helps WSDOT Defeat a $640 Million Claim
The biggest construction project in Seattle in recent years has been the replacement of a seismically compromised waterfront viaduct with a tunnel carrying State Route 99 under downtown. The project was delayed for about two years while the contractor repaired damage to its tunnel boring machine. The contractor claimed that the damage was caused by
Design-Build and EPC Contracting Approaches Under Fire by Contractors
In a recent article in the ABA’s “Under Construction” publication (link here) the author describes a trend among some major contractors, including SNC-Lavalin, Fluor Corporation and Granite Construction, to leave the DB and EPC space. Other large contractors have announced similar intentions. The problem appears to be that the DB and EPC delivery methods
Commercial Lease Improvements
On December 13, 2019, I will be giving a presentation on construction-related topics arising from commercial lease improvements. The presentation is part of a two-day seminar on Advanced Commercial Real Estate Leases, co-chaired by my colleague, John A. Fandel, and hosted by Law Seminars International. Topic will include insurance coverage, mechanic’s liens, scheduling, indemnity, safety,
Update on Alaska Way Viaduct Replacement
Occasional visitors to Seattle may be surprised to discover that their favorite route from the airport to downtown has changed. State Highway 99 no longer links to the Alaskan Way Viaduct into downtown Seattle. The waterfront viaduct has been closed and demolition has begun. The Battery Street tunnel that connected viaduct traffic to Aurora Avenue
Avoiding Development Disasters: Land Inventory and 1031 Exchanges
The ability to defer taxes through a 1031 Exchange can make or break a real estate transaction. But federal tax law does not treat all real estate owners equally. Under IRC Section 1031(a)(2), real property held “primarily for sale” in the ordinary course of a trade or business is excluded from Section 1031 and may be subject to ordinary income taxes in the event of a sale.
Generally, land held for investment purposes can be swapped for “like kind” property without triggering taxable gain. However, certain property is excluded from 1031 because, under IRC Section 1221(a)(1), it is not a capital asset, including:
(i) Stock in trade of the taxpayer
(ii) Inventory; or
(iii) Property held by the taxpayer primarily for sale to customers in the ordinary course of a trade or business.
Such property, including any real estate which qualifies as inventory, is excluded from 1031 treatment and, upon sale, is taxed at ordinary income rates. This means that active developers dealing in subdivided property for sale in the ordinary course of business may be excluded from capital gains tax treatment.
Doing It Differently: Portland’s Plan to Redevelop the U.S. Post Office Site and Broadway Corridor
Portland real estate is booming and Portland is now on the map for many national and international developers for the first time. This success, while enviable, is not without some negative consequences, as evidenced by increasing housing costs and congestion.
As Portland anticipates the arrival of even more people, it is trying to figure out where to put those new arrivals and how to preserve and enhance quality of life for both new and existing residents. Large-scale City planning efforts such as the 2012 Portland Plan and 2017 Comprehensive Plan reflect a recognition that not everyone has enjoyed the benefits of past prosperity and public investment, and that the City will seek to be more intentional and inclusive going forward.
An emerging redevelopment area offers an opportunity to try new things and develop differently this time. The Broadway Corridor redevelopment area is 24 acres located between the Pearl District and Old Town/Chinatown. The area is centrally located in downtown Portland, has freeway access and is served both by Amtrak, via historic Union Station, and by TriMet’s light rail. The “pearl” of this redevelopment area is the 14-acre U.S. Post Office site, bordered by NW 9th Avenue, NW Hoyt Street, NW Broadway and NW Lovejoy and purchased by the City of Portland in 2016.
The City purchased the Post Office site for almost $90,000,000 and understandably is carefully shepherding this public investment. The City’s Broadway Corridor Framework Plan provides a conceptual “framework” for future development of a 24-acre area including the Post Office site, but actual development will require a new type of public-private partnership and substantial further refinement of the plan, with the City committed to recovering its financial investment.
Public Private Partnerships Provide an Opportunity to Leverage Private Sector Expertise and Financing for Public Benefit
Creative solutions will likely be required to bridge the gap between the cost of addressing growing infrastructure needs in the U.S., currently estimated at $4 trillion, and the amount of available public funding. One increasingly popular possibility involves supplementing public funds with private financing through agreements that allow for greater private sector participation in the