Long-time Spokane businessman and entrepreneur Pete Rayner says it’s go time. After 26 years, Rayner says he is ready, willing, and able to start the real work of building his dream project at Beacon Hill, in East Spokane. And the City of Spokane agrees. Mostly.
Beacon Hill Properties LLC, which Rayner owns with Dave Baker, has worked for years on developing more than 200 acres of property northeast of Esmeralda Golf Course into a mixed residential area. The first phase of that project is to include two 140-unit apartment buildings, 130 townhomes, and 40 lots for residential units, he says.
Envisioned since 1983, Beacon Hill Properties purchased the bulk of the 200 acres in 1988 and 1992. Ultimately, the Beacon Hill development project is projected to have 1,500 to 3,000 residential units and to be developed in 10 phases. At a development cost of $25 million-plus, the development would include a golf cart path to Esmeralda Golf Course, which is downhill from the site, community gardens, walking trails, and an outdoor amphitheater.
Rayner says he also wants to build a shop facility, a park system, and improve biking trails. A downhill mountain bike course already is located on the property that is popular with bikers, he says. Fully developed with all phases, Rayner says the property should be valued at more than $375 million.
Rayner says preliminary plans have been approved, and work will begin next month to develop the lots to have them ready for the start of residential construction either this fall or next spring. The first phase of curbing, sewer and water infrastructure is estimated to cost about $2 million. The land is zoned for single-family and multifamily uses and is within Spokane’s city limits.
The residential lots are located about a mile east of Market Street via Wellesley Avenue, adjacent to the Beacon Hill Event Center, which Rayner owns with his daughter Ellie Aaro.
Rayner says the process hasn’t been easy, but city of Spokane officials have been supportive of the project and he is confident Beacon Hill Properties will secure the required approvals.
“Getting everything accepted before you get a building permit is the challenge,” Rayner says. “We could have builders start construction this fall. The city is energized to get this done.”
Obstacles have been the rule rather than the exception with the massive project, says Jan Quintrall, the city of Spokane’s director of business and developer services.
“He’s come a long way,” Quintrall says of Rayner. “There have been so many challenges up there and just when we think we’re there, something changes.”
One of the hindrances to development has been access to the site. Wellesley Avenue, which merges into Valley Spring Road before ascending up to the property, is a windy, narrow road with blind curves. Rayner says realignment of the road is critical since it is the only entry point to the property.
Rayner submitted the design for a road realignment late last fall.
“We had to get the road worked out,” Rayner says. “We spent $350,000 in legal and engineering regarding the realignment and getting the city to agree to the whole design. The process is 98 percent finished.”
The road realignment projected cost is about $2.4 million, he says.
Quintrall says the road project is a major job.
“He is removing part of the hillside and straightening the road out a lot,” she says. She says approval of the realignment part of the project is in the final public-comment phase. “It’s imminent,” Quintrall says.
If the city approves the project, construction wouldn’t start until early July 2015 and would take about three months to complete.
Another obstacle Rayner faced was a requirement by the city of Spokane to provide a water booster station Rayner refers to as a water lift, which pumps water to higher ground. It’s to be built right below an existing water tower at an estimated cost of about $450,000.
Rayner says the lift station is out to bid right now.
“We should have bids on that by the end of the month,” he adds. “So there are a lot of moving parts.”
Rayner is seeking tax-increment financing (TIF), a state-authorized economic development tool used to pay for publicly owned streets, sewers, sidewalks parks and other infrastructure improvements using gains in tax revenue from development activity.
Last October, Spokane County formally adopted a TIF district that includes all of the Beacon Hill development, Rayner says, giving the project access to about $20 million in reimbursable funds over a 30-year period. He says he will pay for the road project, but expects to be reimbursed “to the tune of about $2.4 million.”
Quintrall says a few issues still need to be addressed before the road realignment project will have final approval. “The final comment phase is an opportunity for all the agencies that touch the development to ask questions and identify issues,” she says.
For instance the Spokane Tribe of Indians has requested an archaeological survey and subsurface testing of all construction and staging areas, citing the presence of archaeological sites in that area. Rayner says Beacon Hill Properties has retained a tribal archeologist to do a cultural study of both the road realignment area and phase one of Beacon Hill, which will be completed by early July.
Rayner contends that changes in the road and the addition of Beacon Hill residences will have a beneficial impact in Hillyard and northeast Spokane.
“I was a young man when I bought this property,” he says, adding that today he’s 67 years old. “I will be very happy to see phase one done. We’re just excited to begin to see people living up here enjoying it like we have It’s a special place. It’s time to see it happen.”
Rayner says the Beacon Hill Event Center hosts about 65 weddings at its clubhouse and gardens that overlook the city and caters a total of about 500 events per year, including those at offsite locations.
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