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Downtown high-rises: Federal Way investor joins Symphony project
Downtown Federal Way's mixed-use high-rise project may move forward with help from an unexpected international investor.
On Sept. 10, the city council voted 6-to-1 to approve a six-week extension on the contract between the city and Canadian developer United Properties Ltd., which, in 2007, agreed to build the Symphony project. United now plans to partner with Landor Korus, a Korean investment company, to purchase the former AMC Theatre site and construct Symphony. The sale price of $6.156 million will not change.
The companies have never worked together and representatives from each met only weeks ago. But United Properties president Victor Setton and Landor Korus representative Wayne Choe both said they hope to finally bring Symphony to Federal Way.
"We believe in Symphony," Setton said. "It's something very dear to me and I want to do whatever it takes to make sure it proceeds."
Council member Jim Ferrell issued the dissenting vote.
"My concern is, at the last minute, essentially is what we're doing is a hand-off," Ferrell said.
Federal Way's contract with United was due to expire Sept. 11. The council received notice on Sept. 9 that Landor Korus had come forward with an interest in working with United Properties to jointly build the endeavor. The South Korean investment company has experience in its home country, but limited experience in the United States.
A handful of businessmen, including the company's chairman and Choe, live in or near Federal Way. Choe considers the city his home, he said. His children attend school and play sports here.
"We're not an outsider or stranger," Choe said. "We're here to make this thing grow."
Choe and Landor Korus became interested in Symphony a month ago through talks with city council member Mike Park and city staff. The company was looking to invest in a sizable Washington project, Choe said.
Choe contacted Setton and the two discussed a possible partnership, with United Properties serving as an advisor and Landor Korus acting as the financial backer and developer. Money to fuel the project will come from Korean investors, Choe said. Landor Korus has no need to seek financing from banks here or abroad. Setton will ensure all the city's codes are met. Choe and his team will build the project.
"We will keep utilizing his abilities and advice," Choe said of Setton.
Many details of the partnership have yet to be worked out.
"We are the new kids on the block and want to have time to get things right," Choe said.
The council expressed its desire to keep Symphony's concept and design relatively unchanged. Landor Korus would like to put a Korean touch on the development. This would likely only include improvements to detail and amenities, Choe said. Still, some council members are cautious.
"I want to make sure it stays in line with our vision in our city center," council member Dini Duclos said.
Ferrell said he fears Landor Korus will move away from the Symphony design and toward a performance, cultural and conference center on the site.
The city council plans to look at Landor Korus' credentials. On Nov. 3, it will hear details of design changes and the United Properties/Landor Korus partnership, then decide if it wishes to proceed with Symphony. Regardless of the council's decision at that time, United Properties is due to pay the city $150,000 in carrying costs for the year the property went unsold while United sought financing.
Long time coming
Symphony includes office, retail and residential space in four high-rises surrounding a one-acre park. In December 2007, United agreed to purchase the 4.1-acre site and construct the $235 million project. Leading up to the agreement, the developer and city council spent months coming to terms on the project's design.
The real estate market then took a drastic turn for the worst and the economy plummeted. United Properties struggled to find financing. Construction was scheduled to begin summer 2008. On Sept. 9, the council extended United's contract by one year — giving the developer until Sept. 11, 2009, to begin construction.
On Aug. 25, the developer asked the council to allow until February 2010 to rearrange its concept and instead secure financing for a performing arts, cultural and conference (PACC) facility to replace Symphony. The council rejected the request, saying it had not decided whether it wished to build a PACC on the property if Symphony were to fall through. Landor Korus' involvement comes at a time when Symphony's construction was beginning to look impossible.
"Sometimes fate happens at the eleventh hour and things work out," Duclos said.