Crystal Palace awaits financial fate
By GREG ALLMAIN
Federal Way Mirror reporter
January 31, 2012 · 5:36 PM
The ambitious Crystal Palace project, as proposed by Boston-based ARCADD Inc., may be on hold in Federal Way for the time being, due to some minor details regarding financing.
This news was announced by Patrick Doherty, economic development director for the city, during the Federal Way City Council's retreat Jan. 28 at the Dumas Bay Centre.
Doherty said he and Mayor Skip Priest had been on the phone with Dr. Hisham Ashkouri, the man who would be the principal architect for the project for ARCADD, and Roger Kimball, who is representing the financial interests in the project.
"What they indicated is that, they're moving very diligently every day, on calls across the world to Asia, or wherever these trustees are," he said. "And Roger Kimball said that he believed the agreements that he has to have signed, would be signed, and then the funds would be available in February."
Doherty said Priest put Kimball on the spot, asking how sure he is of that time frame, with Kimball replying that he's "90 percent plus sure." According to Doherty, Kimball indicated that one of the key individuals who would help finance the project needs to come to the U.S. to sign the appropriate paperwork, and that the February time frame comes from the fact the individual is currently in some part of Asia.
"It's still on hold, but they said they would tell us as soon as there's a signed document," Doherty said. "The trust will be public once (the paperwork is) signed, and they said…we would be 'surprised and pleased' as to who that is."
When pressed for more information by councilwoman Dini Duclos, Doherty said the only information the mayor and city staff have regarding the financiers is that it's an "international equity trust." Along with that, he said that Ashkouri and ARCADD are close to being done with their designs and other elements, and are ready to move forward as soon as the money is secured.
Deputy Mayor Jim Ferrell expressed concerns over this delay, especially in light of the issues the city has had with previous developers and trying to secure the money to get the project moving forward.
"Before I would agree to anything else, I'm going to have to see a lot more transparency. I've gotten to the point where I'm really uncomfortable with where this is all at. For me, before I would accept $150,000 (an amount ARCADD was to come up with before the end of January), I would have to have a lot more transparency. I want to know who these people are, and it's not enough to know on the back end of due diligence," he said. "One of my concerns is, frankly, even if we do our due diligence…somehow along the line, this doesn't happen, and we end up with a hole in the ground and in litigation indefinitely."
Councilwoman Linda Kochmar said she feels the city should give its trust to ARCADD and the as-yet unknown financial backers.
"I'd like to say, Dr. Ashkouri has put a fair sum of money into developing this project. It's not that he doesn't have any skin in the game, he does," she said. "I think we should give this group every opportunity to present what they have to offer without saying 'Gee, I'm concerned.' We're all concerned. We've always had those concerns."
Outside of considering leniency for yet another developer after being snubbed twice, Duclos shared that not knowing the financial backers at this stage is just part and parcel for a project of this scope and size.
"I think if they come back to us, with the down payment and the financing, that's when it will become public. They can't release financing, who they're talking with beforehand. You don't do that. Once they sign it, and it's transferred to them, everything is wide open to us and then we'll know if they can or can't do it," Duclos said.
Councilman Bob Celski sided with Ferrell, saying this uncertainty over who is bankrolling the proposed project is unsettling.
"I want some more concrete assurances. You mentioned that Dr. Ahskouri may have some skin in the game, and they do. I'd like to see more detailed plans. I don't want to see this thing going another indefinite amount of time without having the development done," Celski said.
Because of this bump in the road, Doherty and Priest had a new contingency plan to unveil to the council. According to Doherty, this plan would be a two-acre park with a retail/residential mix adjacent to it. Outside of this, the council also looked at re-invigorating plans for the proposed civic center site as well during the retreat. The hope, as always, is to just get the one spark going in the downtown core that would be transformative for Federal Way.
"Either one of those projects will jump-start development in the downtown. Both of them is a win-win, but we need to get one of them going," Duclos said.
Contact Federal Way Mirror reporter Greg Allmain at email@example.com or 253-925-5565 ext. 5054.