Kirkland Reporter, January 28, 2011

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KIRKLAND .com

REPORTER

NEWSLINE: 425.822.9166

SCHOOL LEVY | Readers sound off on Lake Washington School District bond levy on Feb. 8 ballot [4-5]

Prep sports | Kirkland high school sports teams from Juanita and Lake Washington begin postseason runs [16]

Shady Lady | Former king of Kirkland fashion Bob Lightfeldt FRIDAY, JANUARY 28, 2011 remembers Totem Lake Center [2]

A DIVISION OF SOUND PUBLISHING

Part 3: Litigation clouds Totem Lake Malls’ future Eleven other malls involved nationwide in lawsuit, ownership group profiled BY MATT PHELPS AND CARRIE WOOD

What’s next?

Kirkland Reporter

W Tent City 4 resident Alan Erickson puts up a tent at the homeless encampment that moved into the parking lot of Kirkland Congregational Church on Saturday, directly across the street from Kirkland City Hall. Tent City currently has 86 residents, though the encampment can house up to 100 people. Tent City is currently in need of many items, including: disposable cups, toilet paper, batteries (AAA, D), coffee, creamer, sugar, trash bags (33 gallon), hand sanitizer, canned and microwavable food, paper plates, bowls, razors, shaving cream, tooth brushes, shampoo, cold medicine, warm hats, socks, thermal underwear and more. To donate, please contact 206-618-3901. MATT PHELPS, Kirkland Reporter

Totem Lake Fred Meyer to expand, remodel to be completed in September BY MATT PHELPS mphelps@kirklandreporter.com

What’s on your list today? How about a bigger Totem Lake Fred Meyer with expanded photo electronics, apparel and food departments. The 31-year-old store is currently gearing up for a nearly $10 million remodel, adding approximately 3,000 square feet, a Starbucks and drive-through pharmacy. “Typically we remodel our stores every 10 years and this store went through one in 1989 and 2000,” said

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Fred Meyer spokesperson Melinda Merrill. The remodel won’t technically begin until Feb. 28, but the preparation has been going on for months. All of the stores that occupied the front of the building have moved to other locations in Kirkland. Those businesses will not return to that location, as Fred Meyer will use that space for the expansion. All of the work on the expansion is expected to be completed by September. Construction has already technically begun on the [ more EXPAND page 7 ]

hen co-owners Coventry Real Estate Advisors (an investment management company) and Developers Diversified Realty (a real estate management company) purchased the Totem Lake Malls in 2004, they intended to redevelop the site. The joint agreement between the two companies was not the first – but is probably the last. This is the third part of a five-part series on Totem Lake Malls, which started with the history and continued with the demise of the property. This week, the Reporter will profile the two companies, their joint agreement to redevelop retail property and take a look at the lawsuit that has stymied redevelopment efforts in Kirkland.

The lawsuit

Construction workers begin laying the foundation for an addition to the south side of the Totem Lake Fred Meyer store. MATT PHELPS, Kirkland Reporter

Find us at KirklandWindermere.com 737 Market Street Kirkland, WA 98033 | 425-823-4600

The group purchased the Totem Lake Malls site from the California Public Employees’ Retirement System for $37 million in 2004. But the relationship between the two companies has turned into a tangled mess of litigation. In addition to Totem Lake, the joint agreement included 11 other malls nationwide that are now listed in the lawsuit filed by Coventry against the $17.9 billion Developers Diversified Realty (DDR). Most of the sites were

Next week the Reporter will look at the economic impact of the mall and what is currently at and around the site. To voice your opinion for the final piece of the series, sound off in a survey at www.kirklandreporter.com and search “sleeping giant.” acquired with the idea of taking under-performing malls and redeveloping them. As a part of the agreement, DDR has provided 20 percent of the required equity capital for projects, while Coventry is responsible for the remaining 80 percent. However, Coventry now asserts that DDR has not fulfilled the agreement. The Totem Lake site is a part of the $500 million fraud lawsuit filed in New York state. During the past three months, the Reporter has made numerous phone calls and e-mails to both companies and their lawyers with no response. Though city officials can’t say if the lawsuit is solely to blame for Totem Lake Malls’ delayed plans, the litigation has certainly played a role. “It’s hard to say whether it’s the lawsuit or the economy that is clouding redevelopment plans to the property,” said City of Kirkland Economic Development Manager Ellen Miller-Wolfe. “What I have understood [ more LAWSUIT page 13 ]

Windermere Real Estate/Central, Inc.


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