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Originally published September 7, 2012 at 8:22 PM | Page modified September 7, 2012 at 9:58 PM

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Deal settles developers' dispute over Bellevue project

Bellevue Square developer Kemper Freeman Jr. and Seattle-based development firm Wright Runstad have agreed to settle a dispute over future traffic impacts between Wright Runstad's Spring District project in the Bel-Red Corridor and downtown Bellevue.

Seattle Times staff reporter

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Bellevue Square developer Kemper Freeman Jr. and Seattle-based development firm Wright Runstad may still be competing for tenants for their ambitious projects on opposite sides of Interstate 405.

But they're no longer fighting over the traffic Wright Runstad's planned Spring District project will bring to the Bel-Red Corridor and roads leading downtown.

After three years of conflict — which played out in last year's City Council elections — the battle came to a close this week before a city hearing examiner: The two developers reached agreement on what's needed to make sure roads don't become gridlocked.

Freeman's Kemper Development and Wright Runstad signed on to a four-way deal Thursday that will allow construction of 1.5 million square feet of office space in The Spring District without further traffic studies.

But Wright Runstad and its partner, Shorenstein Properties, will be required to do a detailed analysis of future traffic congestion before building the remainder of the 5.4 million-square-foot project on the site of a former Safeway distribution center.

The Spring District is expected to bring 13,000 office workers, 2,135 residents and 10,000 parking spaces, sparking redevelopment of the 900-acre industrial area east of downtown. Sound Transit plans to open a light-rail station on the site in 2023.

Kemper, Wright Runstad, the Brierwood Center strip mall and the city of Bellevue signed the agreement after two days of testimony before the hearing examiner. Kemper and Brierwood withdrew their appeal of The Spring District's master plan approval in exchange for the city requiring a future study of cumulative traffic impacts.

The city previously had decided that a traffic study for the entire Bel-Red Corridor, together with phased studies of The Spring District impacts, was sufficient.

The hearing examiner is continuing to take testimony on a separate appeal by Lake Bellevue condominium and business owners, who fear the nearby development could bring flooding, water pollution, a drop in the lake's water level and possible damage to buildings built on peaty soils.

Kemper and Brierwood executives said the settlement eases their concern that The Spring District would overwhelm roads connecting the Bel-Red Corridor project with downtown Bellevue and two freeways, particularly if the city fails to fund needed road improvements.

Bruce Nurse, Kemper's vice president for transportation, said the company that built Bellevue Square appealed The Spring District's master-development-plan approval reluctantly, and only because the city failed to adequately plan to upgrade roads.

"What we're concerned about, and we have been all along, is the density and the traffic congestion in Bel-Red doesn't become a blockade for travel from east to west or west to east from Interstate 405 to downtown Bellevue," Nurse said.

"It isn't solely our properties, even though we carried the burden on this. It's the whole downtown."

Freeman and his allies on the City Council have resisted increases in property taxes and developer fees to fund road projects that Freeman has said Wright Runstad should pay for. The City Council will take a fresh look at the city's capital-spending plan this fall.

Todd Woosley, a member of the family that owns Brierwood Center, said one reason for settling its appeal was "that we felt it was much more productive to have everybody work together with the city of Bellevue and to find a way to get as many of these roads built as soon as possible."

"We're pleased that Kemper and Brierwood Center made the decision to withdraw their appeals," Wright Runstad spokesman Roger Nyhus said in a statement.

"Our predevelopment work, which includes design and marketing of both office and residential projects in the initial phase of The Spring District, continues in earnest and was not, nor currently is, impacted by the appeals."

Keith Ervin: 206-464-2105 or kervin@seattletimes.com

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