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Originally published July 31, 2012 at 9:41 PM | Page modified August 1, 2012 at 10:38 AM

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Industrial Sodo splits on arena, neighborhood's future

Sodo industrial business owners say they expect a new arena would eventually cause property values to spike but are mixed on whether that's good or bad.

Seattle Times business reporter

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I don't profess to be a lawyer, expert on economics, etc, but when two seperate panels... MORE
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Like I said the other day, sensical. The opposition is like the Black Knight in Monty... MORE

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On a warm day, the sharp smell of fresh-cut lumber spills onto the sidewalk outside O.B. Williams Co.'s modest plant on First Avenue South in Sodo, where workers turn out custom architectural woodwork — paneling, molding, cabinets, doors.

Their handiwork adorns Benaroya Hall, the Four Seasons Hotel and Private Residences, and many upscale homes.

O.B. Williams has been a Sodo fixture for more than a century. Now it could get a new, high-profile neighbor: Investor Chris Hansen's proposed $490 million basketball and hockey arena would be built less than a block up the street.

Sodo is no stranger to big sports facilities. But Hansen's arena would push deeper into Seattle's oldest industrial neighborhood than have CenturyLink or Safeco fields, closer to its warehouses and factories.

Would the arena hasten Sodo's deindustrialization? Forecasts vary.

City planners say tough zoning restrictions protect industry in Sodo and an arena wouldn't change that.

But David Wick, O.B. Williams' president, is apprehensive. "I'm afraid the property values could double or triple," he said, with property taxes following suit.

"We would like to stay here," he added, "but I'm afraid our company would be displaced."

Arena traffic is another issue. It could help push industrial businesses out even if zoning restrictions remain in place, some advocates of industry say.

The city's Planning Commission raised similar concerns in a report last week.

But some Sodo property owners say they would applaud if the arena helped nudge the neighborhood toward a less-industrial future.

"This area is changing," said Tim Ruud, who owns a small, custom industrial-sewing factory a block down First Avenue from O.B. Williams, "and it seems inevitable it's going to change some more."

Less industrial

Sodo is home to freight companies, wholesale distributors, scrap-metal yards and factories that make everything from airplane parts and industrial immersion heaters to feather beds and bottles.

But it isn't as industrial as it used to be.

"The bag down here's really mixed," said Rick Jay, president of Process Heating, a small manufacturer on Third Avenue South. "It's very different from when I started here back in 1976."

Starbucks, Seattle Public Schools and Internet startup Zulily all have their headquarters in Sodo now.

A former foundry has become a trapeze school.

A digital marketing firm leases space above a Krispy Kreme store in a newer building across South Holgate Street from Hansen's arena property.

City officials detected the trend more than a decade ago and moved to slow it. Concerned about losing family-wage jobs, they designated Sodo and neighborhoods to the south a "manufacturing/industrial center" and adopted policies to limit development deemed incompatible.

Sodo's industrial zoning prohibits apartments, condos and most entertainment uses. The City Council adopted tight size limits on new office and retail buildings five years ago.

A recent council staff report suggested the arena, whose site is zoned less restrictively, could encourage developers to buy up surrounding industrial property in anticipation that its zoning will change.

That could drive up land values and make Sodo less affordable for industry, the report said. Hansen himself has suggested the arena would push up property values and property-tax revenues, it noted.

But Diane Sugimura, director of the city's Department of Planning and Development, says the council has given no hint it's inclined to weaken zoning protections for Sodo industry.

"The office and retail limits are pretty restrictive," she said. "It's a pretty strong line."

Built on exports

A few blocks east of the arena property, across three streets and three sets of railroad tracks, trucks back in and out of the 24 bays at MacMillan-Piper's 100,000-square-foot warehouse at Holgate and Sixth Avenue South.

The freight-transloading company mostly handles exports. It unloads big rolls of paper and other bulk cargo from rail cars, puts it into shipping containers, and trucks those containers to waterfront docks such as the Port of Seattle's Terminal 46, where Sodo touches Elliott Bay.

The company has three other facilities in Seattle, two more in Tacoma.

Getting to and from the Seattle waterfront already is a problem, company officials say, and it's even worse when there's a night game at Safeco or CenturyLink.

Traffic starts to clog hours before game time, says logistics manager Tony Barter He usually stops dispatching trucks by early afternoon.

Adding arena traffic could make the situation even worse, says MacMillan-Piper President Steve Stivala. Exporters could take their business to other ports.

"If we can't move containers in and out," he said, "we stop doing business in Seattle."

Barter frames it differently. "I'd love to see a basketball team and a hockey team here," he said, "but I don't want to move to Tacoma."

The Port of Seattle and BNSF Railway have raised similar concerns. Hansen and his allies maintain the arena's traffic impacts have been overstated. Some Sodo businesses say arena traffic won't affect them much at all.

"The games are played at night. We're not open at night," said Doug Glant, CEO of Pacific Iron & Metal.

Dave Gering, president of the Manufacturing Industrial Council of Seattle and a leading arena critic, says arena traffic threatens not only the viability of port-oriented Sodo businesses such as MacMillan-Piper, but the viability of the port itself.

"The macro land-use issue here is the future of Terminal 46," he said.

It's already been targeted for redevelopment. Nearly 10 years ago developers proposed 4,000 apartments and 2.6 million square feet of office space there, surrounding a central park with a lake.

Port of Seattle officials rebuffed that. But Gering suggests something similar could emerge if maritime trade falls off.

"You've got an area right now that generates jobs, especially in marine cargo and railroads," he said of Sodo. "Why jeopardize something that works?"

Son follows father

Tim Ruud's father founded Commercial Fabrics Manufacturing in 1975. Ruud went to work there after he finished high school a year later.

The business has been on the same block of First Avenue South the whole time. In the 1990s, Ruud watched Starbucks move into the massive old Sears building a few blocks south.

Now he's stoked about the prospect of a sports arena a few blocks north.

He's a big hockey fan and never thought he'd watch an NHL game in his hometown. But he has another reason for supporting the arena that he acknowledges is more selfish.

"I'm hoping it'll jack up the value of my building and my retirement," Ruud said.

City zoning may say otherwise, but industry's day is done in Sodo, he says.

Glant of Pacific Iron & Metal agrees. "Industry makes no sense anymore from an economic standpoint," he said. "The city's pretty much saying, 'We want to force you to be here.' "

Glant opposes Hansen's arena. But if it prods the city to relax zoning, he says, "then it may help us."

At 69, he says he has no plans to redevelop the scrap-metal yard on Fourth Avenue South that has been in his family for three generations. But he'd like his children to have the option.

Ruud says city policies, such as requiring employers to provide paid sick leave and restricting on-street parking on First Avenue South, already are pushing industry out of Sodo.

"Somebody like Paul Allen will buy this block and put in something," he said. "I'd like to sell this building when I'm 65 and go sit on a beach somewhere."

Eric Pryne: 206-464-2231

or epryne@seattletimes.com

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