The next phase of the development of University Place’s town center, also known as the Village at Chambers Bay, kicked off earlier this month with the formal sale of a commercial parcel at the community hub this month.
The City Council approved the sale of the land to Seattle-based development group Verus Partners, which brought Whole Foods to the property under a previous project. The price tag for the land is $419,935. The current land purchase was first negotiated almost three years ago, but wasn’t formalized until the first development was built and city survey work was completed.
The price was set in 2013 when Verus was developing what is now home to Whole Foods. It breaks down to $15 a square foot, which was about three times the market rate of the space three years ago. It is roughly market rate now.
“This figure was based off analysis and negotiation, intended to set a price that was higher than the market at the time, but gave Verus the benefit of fixing a price that would not penalize them for the increased property value that they created by bringing Whole Foods to Town Center,” City Attorney Steve Victor wrote in a staff report. “The market for Town Center property in 2013 was in the $4-$5 (per-square-foot) range. The $15 per square foot remains appropriate in today’s market, accounting for the increase in value from the presence of the successful University Place Whole Foods. But it is important to understand this price is built into the Development Agreement and is not negotiable.”
Plans for the land call for the construction of a 25,000-square-foot retail and office building, south of the Whole Foods, that is currently a gravel parking lot. Project designs and permits are in the works as are possible tenants.
The campus is now home to City Hall, a branch of the Pierce County Library system, the police station, the headquarters of West Pierce Fire and Rescue, the SEB-developed Clearview 100 mixed-use building and the future Latitude 47 mixed-use building. Verus’ developments include the Whole Foods Market and smaller retail spaces.
Verus now has four months of due diligence, and then another four months of design and permitting under the agreement, but that timeline is projected to go much faster since much of the design work has already been done.
Verus also has development rights to five other sites on the campus that are scheduled to be developed in phases during the next four years.
The only parcel on the campus that is not under contract already is Lot 11, which is on the west side of Bridgeport Way, across from Market Square. The site is likely going to be the last parcel to face development.
Verus Partners is a real estate development and investment firm with offices in Arizona and Washington. The company acquires and develops retail and office properties throughout the western United States. The partners have longstanding relationships with Whole Foods, Nordstrom Rack, Kohl’s, Home Depot, Costco, Bed Bath & Beyond, Michaels, Sears, PetsMart and a number of other major national retailers.
New tenants on their way to the campus include Top Pot Doughnuts, T-Mobile and Mediterranean Gyro Grill.