Harcourt Falls Short on Condo Project
by Giovanni Roverso
After Two Missed Deadlines, Will Harcourt Meet Third?
You should have been able to see three condominiums rising up from behind the graffiti wall along Granary Avenue by now.
The original contracted called for condominium occupancy to begin in October 2019, a revised contract called for occupancy to begin in January 2022. In mid-2021, it became clear to the port of Bellingham that Irish property development and management corporation, Harcourt Developments, Ltd. wouldn’t be finished working on its first waterfront residential project by the end of the year.
The port sent Harcourt notice that it was in default of its redevelopment agreement on June 8, 2021.
Harcourt didn’t start construction until July 2020 — two months after its last extension. Harcourt dug out a rectangular area where the project’s foundations and parking garage will be, then construction activities ceased altogether from November 2020 to April 2021.
Two of the buildings must now be completed and made ready for move-in by the fourth quarter of 2023, while the third, southernmost building on the lot is allowed to take up to 18 months longer.
Port of Bellingham Public Affairs Administrator Michael Hogan said the port has had conversations with Harcourt about Covid-19 impacting their ability to meet schedule requirements. Design and permit-related challenges have also been a common topic since the project began.
Port commissioners announced that they would agree to extend the condominium’s construction schedule, one last time, at a meeting on August 9, 2021. They said they wanted to see the project through as soon as possible, and Commissioner Ken Bell said they’d decided not to push for a litigation or an arbitration against Harcourt.
Bell conceded that the city was behind schedule in getting sewage, water and power infrastructure at the waterfront and that the pandemic had put everyone in a hard place for months.
So, what has been happening at the construction site?
Keeping Up With Construction
Images from a June 2021 stormwater inspection show that two foundation pipe piles had been installed in the ground in the middle of the site. Only two more were added by mid-September, with hundreds more still to come.
As of September 2021, the ground all around the hole Harcourt dug out for the garage foundations still lacks the measures necessary to keep it from eroding, called shoring.
Because the condos will be built along the edge of Waypoint Park, Harcourt will need to use sheet piling to shore the land up. This type of shoring was something the permitting department insisted on so existing park features wouldn’t be disturbed, Senior City Planner Steven Sundin said. They will also need to install soldier piling to shore up the slope under the Granary Avenue graffiti wall and the side of the hole that lies opposite of Granary Avenue.
Work on the waterfront condominiums has been challenging due to the location. Not only is the property within shoreline jurisdiction, but it was filled in as the old mill site grew over the water there, making it vulnerable to earthquake-caused liquefaction.
On top of that, the soil had to go through a partial cleanup in 2016, leaving contaminated soil under a cap.
Dealing With Contamination
During construction, Harcourt must follow a stormwater management plan to ensure that old industrial contaminated sediment and new workplace contaminants, such as equipment oil, do not drain out of the site.
Site inspections by state employees had been impossible during the first part of the pandemic due to Governor Inslee’s stay-at-home order.
Washington State Department of Ecology inspectors visited the site following up on a complaint on June 21, 2021.
The complaint was about contaminated water being discharged into the old Georgia-Pacific Aerated Stabilization Basin on the other side of the Whatcom Waterway. The area still has a pumped stormwater conveyance system leading to the basin.
Inspectors determined that storm drains were not being properly maintained at the site and that dirt and concrete rubble stockpiles with possible contamination needed to be covered and contained so they did not contaminate stormwater.
It’s worth noting Port of Bellingham Commissioner Michael Shepard said at the meeting in August that, when he and his family were visiting the waterfront near the bike pump track on hot dry summer days, they noticed voluminous dust clouds coming from the south end of the site, making the experience uncomfortable.
A sweeper machine used to dampen dust was being filled with contaminated water according to the report, potentially causing cross-contamination of the rest of the site. The sweeper was also leaking oil in various locations on the property.
The inspectors also found that two abandoned pipe or drain holes had been uncovered and that one of them had petroleum staining around it, meaning contaminated materials or water could have escaped the site through the hole and reached surface waters.
The inspectors also found that monthly discharge monitoring reports from 2020 and the first five months of 2021 were not submitted until June 8.
Upon follow-up inspection on July 2, one of the stockpiles had been covered as directed, but Harcourt Construction Manager Louis Parr said he was still working on the others. Some of the oil spills had been treated and the hole near the sweeper had been patched up with concrete.
However, John Guenther, the current DOE manager of the pulp and tissue mill cleanup area, who inspected the site shortly after, seemed satisfied with their management of stockpiles.
Guenther is not involved with the stormwater permit, but with the project’s compliance with the Contaminated Materials Management Plan. He checks to see that Harcourt is responsibly approaching the environmental cap DOE placed in the area in 2016.
“They are working with some contaminated soil, but that soil is being segregated and piled separately,” he said.
Guenther said Harcourt would have to decide what to do with the soil, whether it is put back under an engineered cap onsite or taken to a disposal facility, which is more expensive the dirtier it is.
Protecting the nearby environment from the site’s contaminated soil is one thing. But then you have to think about how an underground parking garage so close to shore might interfere with groundwater flows, both to and from the coastline. But then you have to think about sea level rise.
Planning a Safe Foundation
A single parking garage will serve all three condominiums. Sundin said the foundations for the parking garage were originally proposed to simply sit “suspended” on the dirt.
However, because the parking garage must be completely waterproofed, groundwater coming from high tides 50 feet away will not be able to traverse the site. This could cause hydrostatic pressures to push up on the garage.
According to a 2020 shoreline committee report for the project, the original high-water mark at the site is 10.25 feet above what’s called “mean lower low water.”
High sea levels will be more and more common through the years as the sea’s high water mark rises above the bottom of the garage floor. The current accepted science, which is factored into the Waterfront District sub-area plan, predicts a sea level rise of up to 50 inches over the next century.
A 50-inch sea level rise would cause the ordinary high water mark to reach about 14.5 feet above mean lower low water. The finished floor elevation of the condos is just 2.5 feet above that on the side facing water.
But the parking garage’s finished floor is at just 7.3 feet above mean lower low water. That could be 7.2 feet below the water at high tide in 100 years. The southwestern edge of the parking garage is right up against a 50-foot setback line from the original high water mark.
The building would also have to be able to withstand possible tsunami and hazardous seismic events that could lead to the ground’s liquefaction. To accomplish this and provide shear resistance, a few hundred piles will get driven 15 to 50 feet down to bedrock.
Environmental and Planning Services Director Brian Gouran said Harcourt has said that the foundation system is complicated and expensive, but that it’s within budget.
And yet, Harcourt’s funding dried up. The port and Harcourt have worked out a new, restated agreement with a few major changes.
With construction continuing into 2025, Waypoint Park’s second phase will also be late since there isn’t enough room for the two projects to be going on at the same time.
Beyond schedule changes, the restated agreement also reduced the amount of property that Harcourt will be developing in the old Georgia-Pacific mill area from 18.8 to 7.7 acres. If all goes well, the 3.3 acre project site off Bay Street is back on the table. Harcourt will retain the Gateway office building project and other mixed-use projects along Granary Avenue.
Other projects like the Boardmill and the Alcohol Plant will be redeveloped by someone else.
The port is developing a request for proposals for the Boardmill Hotel, which it expects to be issued this fall, Hogan said.
Harcourt’s failure to provide certain insurance documents and adequate financial assurances, which the port had been requesting repeatedly since June 2020, was among the defaults.
“Harcourt has advised the port that it does not have financing in place due to lack of permits,” the notice states. But financial assurance was never dependent on permitting.
Harcourt will now have to provide detailed financial assurances with each new project’s memorandum. A new memorandum of agreement for the condos is in the process of being finalized.
From now on, before the port sells property to developers, they will have to assign an irrevocable letter of credit from a bank to the port at 20 percent of the project construction costs in case the developer fails to complete the project, Gouran said at the August port commission meeting.
Approved building permits also are required before property can be transferred.
The port is giving Harcourt one more allowance with the condominiums’ permits though.
Time for Final Touches
Since 2018, the condominiums have gone through a series of design and layout changes and multiple city departments have coordinated with Harcourt and two different architectural firms.
The new agreement allows Harcourt to also incorporate feedback from the first two buildings into the design of building C.
A last minute loose end also came up at the south end of building C, where windows will offer a vista of the bay. These could pose a fire safety risk to buildings next door, Gouran said. A park is planned there but the technicality still held.
To avoid reducing the windows, the port is selling Harcourt a 20-foot strip of land as an offset. Time would be needed to survey and transfer the 22,000 square-foot strip to Harcourt.
The land will sell for about $52,000. Not much compared to the $1.6 million for the other 1.7 acres and the estimated $60 million construction cost.
Bellingham will have to wait for the results it’s been clamoring for, but that doesn’t mean you can’t go check the district out now.
A New Hangout Spot
When you’re there, you can grab some food and drink by the pump bike track and even see the occasional band play at the stage made from one of the containers there.
This is part of a container village made to get the community down to the waterfront sooner rather than later, Hogan said, plus it’s at a low cost and it can be moved around as the site develops.
Over the summer, the port brought bathrooms, a mountain bike course, a basketball hoop, and even a farmers’ market.
But you could say this is a silver lining on a dark cloud that’s grown between Bellingham and Harcourt over the last few years, delay after delay.
At a port commission meeting on May 7, 2019, Harcourt Development Manager Max Duffy, who had just flown in from overseas, gave a public update about Harcourt’s waterfront projects.
Other than to help wrap loose ends with the Granary building, he said, a big part of his monthlong visit was to help iron out the details necessary to get permitting going for the condominiums and to “keep afloat” with that.
Little information had transpired about the project since the port approved the condo project in February 2018. According to the waterfront 2015 Master Development Agreement, Harcourt should have asked the port to approve such a significant modification.
Harcourt and the port had previously anticipated permitting to be done and construction to begin by August 2018, with buildings getting occupied by October 2019.
Duffy said that construction should begin in the fourth quarter of 2019 and wrap up at the tail end of 2021.
Bell pleaded for Harcourt not to leave Bellingham in the dark when delays occur.
Shepard said it seemed Harcourt had not been acting like Bellingham was a priority compared to its other projects in other areas.
“The question is, for everybody, ‘When, when, when?’” Bell said.
Duffy said Harcourt had been “hamstrung” by its work on an amendment to the Waterfront District’s sub-area plan, but now that that it was ironed out, Duffy said, the roadmap was clear and transparency would be forthcoming.
Supposedly the Last Delay
In October 8, 2019, the port announced another delay. This time Harcourt had given the port notice of material modification, which was to move the condominiums’ construction start date to May 2020.
Various permitting deadlines needed adjustment as the design team worked on feedback from city planners during the early design and permitting phases, Gouran said at the commission meeting.
Gouran said changes had been expected along the way since the geotechnical design and permitting could not begin until the property had been transferred over to Harcourt in 2018 once the project memorandum had been approved.
Commissioners asked Harcourt Property Director Patrick Power, who had flown in from Ireland, to continue stepping up the company’s efforts to expedite the project.
Figuring out the correct starting point from which the buildings’ 50-foot height should be calculated had been complicated. This was because not only will the ground floor be at two different levels depending on whether you’re facing the water or Granary Avenue, but because the grade of the site gradually changes as you go down the street. (This average mean grade, as it’s called, ended up being 18 feet 5.5 inches.)
Briscoe said the Bellingham Planning and Community Development Department was often backlogged and that maybe it needed more personnel to help alleviate the problem.
The department did, in fact, increase its level 1 and 2 planner positions by two and its development specialist positions by one starting in 2020, according to the city budget.
While Power did not point fingers for the delay, Bell said Harcourt couldn’t just blame the city, but itself for changing the design of the condos to squeeze an extra residential floor in on one side.
So, whereas the design in the project’s 2018 memorandum featured a commercial floor and three residential floors on either side of the building, the new design features a shorter commercial floor and four residential floors on the water-facing side.
Harcourt’s original project design submitted to the port in 2016 was for four buildings, not three, so it seems the developer had a chance to make up some of the lost potential revenue.
Harcourt revised their design to the current approach sometime in 2018, Gouran said. According to the permit’s design review section, the developer proposed tapping into a floor area bonus option by allowing the public to access the open spaces between and around the buildings.
Looking for Assurance
Shepard asked Power if Harcourt would be providing assurance that they have the finances in place to complete the project. Power did not indicate any evidence would be provided in this regard, and instead simply said Harcourt did have the finances in place to accomplish each individual building as it goes along and to come visit the developer’s other projects for assurance.
Bell didn’t believe Harcourt would be able to stick to the timeline unless the corporation brought more resources to the table. The commissioner echoed Shepard’s opinion that the project lacked adequate local management on Harcourt’s part and suggested dedicating more trained personnel who could work closely with the condominium’s design team, the port and city planners to expedite the project.
“Your time crunch wouldn’t be what it is today if two years ago you had brought somebody to this town [who] could walk these things through the permitting process,” Bell said. “You’d be in an entirely different place today, your reputation would be in a different place, our patience would be in a different place.”
Desmond Dennehy was added to the Harcourt team as Chief Operating Officer-USA for Harcourt Developments Ltd. in 2019, according to Gouran.
Dennehy was brought to Bellingham as a full-time employee to oversee day-to-day operations — this level of attention had been missing from Harcourt’s projects in town until then, according to Shepard in an interview reported in a Feb. 26, 2020, Salish Current article.
But, while getting Dennehy assigned to the project was a good prospect, the pandemic was unforgiving.
Dennehy happened to be in Ireland during the international travel ban in 2020, Gouran said, and still hasn’t been able to return.
Giovanni A. Roverso is an Italian-American with a bachelor’s in visual journalism from WWU. See his portfolio and blog at www.giovanniroverso.com