Spokane Ready To Buy Salty’s For $2.78 Million Council Prepares For Possible Lawsuit By Clinkerdagger Owner

What’s the best view of the Spokane Falls worth?

City officials say it’s about $2.78 million.

That’s the amount they tentatively have agreed to pay Happy Guest International for the former Salty’s at the Falls restaurant and surrounding property.

Happy Guest has signed off on the deal that city officials say is an integral part of the Lincoln Street bridge project. Council members still must approve the plan March 3, said Phil Williams, the city’s planning services director.

“The deal is not complete until both parties sign it, which I’m sure is a lesson learned by other parties in this process, too,” Williams said. He was referring to Clinkerdagger Restaurant’s negotiated - but unsigned - lease of the Salty’s property.

Clinkerdagger’s Seattle-based owner, RUI, announced plans to move into the Salty’s building in December - before signing a lease with Happy Guest. In January, RUI officials learned of the city’s plans to buy the 34,815-square-foot property for the bridge project.

Jim Welch, executive vice president of RUI, said the negotiated lease may not be legally binding, but it was “ethically binding.”

Welch also said city officials had encouraged RUI to pursue the property, a claim Williams denied.

“We’ve dealt with the city and Salty’s, and I think we’re odd man out,” Welch said. “We definitely feel burned.”

Scott Switzer, vice president of Happy Guest, said his company has “dealt honorably and fairly with all parties involved. We believe it’s the best for us to sell to the city now.”

Switzer refused further comment on the sale.

Happy Guest officials spent an estimated $4.5 million to develop the 450-seat restaurant, which opened in April 1994.

When Salty’s closed last year, Switzer said his company had no intention of selling the property.

“People do change their minds,” Williams said.

City officials decided to buy the property after learning of the restaurant’s plans to close. Building the new bridge around the restaurant would cost at least $2 million because of costly retaining walls and ramps needed to provide access to the property, Williams said.

Taxpayers also face a liability problem, he said. Restaurant owners might blame the bridge project for harming their business, prompting a lawsuit to recoup lost profits.

Buying the property might not end the city’s potential legal problems.

Council members met in executive session Monday to discuss “potential litigation” stemming from the city’s purchase of the Salty’s property.

Williams wouldn’t say what was discussed, but RUI vice president Welch said his company might consider suing. “We certainly feel like we’ve been injured,” Welch said.

Clinkerdagger is negotiating a new lease with the Flour Mill.

Williams said he isn’t sure what will happen to the property after the city buys it. The building probably will be torn down, and the property might be raised to meet the bridge, he said. It also might be converted to park land.

Whatever the case, it is now “an asset of the city. It can be resold,” he said.

The city may have to borrow the money to buy the land from the city’s Solid Waste Department’s reserve fund, Williams said.

That money would be repaid with the $20 million in federal money expected for the bridge project, he said.

, DataTimes