Shelter Holdings Development Applications Denied

RE: Permit Applications for Issaquah Highlands Commercial / Retail Development Along 9th Ave NE

In September 2018, the City of Issaquah Development Commission began holding public hearings to hear legal arguments regarding three permit applications by Issaquah Highlands Investment Fund – Commercial, LLC (IHIF-C), better known in Issaquah Highlands as Shelter Holdings. These proceedings considered 21.5 acres along 9th Ave NE and on Discovery Drive.

IHIF-C applied for three site development permits:

  • 111,000 square feet in retail businesses in 11 single-story buildings with 485 surface parking stalls.
  • 92,417 square feet in a 4-story medical office building with first floor retail and 394 parking stalls, with surface and structured parking.
  • 105,000 square feet 4-story (one below-grade) self-storage facility with 34 parking stalls located on the street, and onsite surface and structured parking internal to the building.

These public hearings continued through July 2, 2019 when the testimonies were completed and the Commission’s deliberations began, 19 meetings total.

Why so many meetings over this length of time? The overarching issue regarded a disagreement between the City and the applicant about which development standards apply to these permit applications. Issaquah Highlands development used to be governed by standards in a 20-year development agreement. After this period, the agreement was replaced with Issaquah Municipal Code regulations.

At the July 2 meeting, the Commission agreed that they had jurisdiction to deliver decisions on the applications. However, citing IMC, the commissioners did not present a decision on which regulations apply to these applications. Commissioner Michael Brennan stated the Director of Development Services determines which applications the Commission reviews, saying, “The Commission doesn’t have the authority to second guess the Director’s decision. It is not within the scope of our authority.”

The commissioners agreed and moved on to discussing the applications. Taking each in turn, the commission unanimously denied each application, citing reasons in a City staff report dated September 17, 2018 that specified the standards by which these applications did not comply with the Replacement Regulations. These standards involved minimum floor area ratio (or FAR, a density measurement), structured parking regulations and public plazas. Attorneys for both the City and the applicant reiterated previous opinions these applications did not comply with the Replacement Regulations.

The Commission stated multiple times it did not review non-compliance of any other standards criteria. For next steps, Shelter Holdings representative, Tia Heim, explained by email after the Commission decision, “Shelter will now appeal to the Hearing Examiner the Director’s determination that the Replacement Regulations (rather than the Issaquah Highlands Development Agreement regulations) apply to these applications.” There was no estimation provided about timing.

This story was published in the Development News section of August Connections News.

For more information, please search, “Shelter Holdings”.