Riverfront land sale under scrutiny

The city of Spokane recently sold a developer more than 10,000 square feet of land adjacent to his upscale condominium development on the north bank of the Spokane River for $10,000.

Spokane attorney Steve Eugster believes the sale was illegal and that city law prevents developer Don Barbieri from building on the land east of the intersection of Broadway Avenue and Post Street.

The property was vacated by the city in 2001, and Barbieri has begun construction on it. Barbieri disagrees with all of Eugster’s contentions and says he has done nothing wrong.

On Sunday, Eugster informed the state attorney general’s office that he believes the property is parkland which was sold illegally, because selling parkland requires approval by the Park Board and a vote of the electorate, neither of which occurred.

“This is a big deal,” Eugster said of the land Barbieri is building his 32-unit Upper Falls condominiums on. “He’s got a real problem.”

Dave Mandyke, the city’s deputy director of public works, said the land was not parkland but agrees that city law may prevent a developer from building on vacated land. The city is treating the matter as pending litigation and has referred it to city attorneys.

If a legal review determines the land can’t be built upon, Mandyke said, “Somebody’s got a problem. I don’t know what we’d do.”

Barbieri said the land was included in his permitting process, which was handled in a “transparent” manner through public meetings. He believes he is permitted to build on it, and he denies that it is parkland.

“It never has been part of the parks department,” Barbieri said. “We’re well under construction on it.”

The city sold the land to Barbieri’s company, Upper Falls LLC, in a quit claim deed on Aug. 12.

Eugster also believes that the riverfront property is worth substantially more than the $1 per square foot Barbieri paid. The land makes up the southern border of the land Barbieri is building the condominiums upon. The units are being sold for prices ranging from $500,000 to more than $1 million.

The YWCA, directly next door on Broadway, recently agreed to sell its 2.2 acre parcel of land for $4 million, which equates to more than $40 per square foot.

However, Stan Schwartz, Barbieri’s attorney, said the two pieces of land are not comparable. Due to restricted access, the land Barbieri bought is only valuable to him as the owner of the surrounding property, he said. In addition, a public easement, guaranteeing public access forever, must be maintained, along with landscaping. Spokane appraiser Daniel Barrett determined the land’s value to be $2.08 per square foot, or about $20,000. State law says that cities are authorized to ask for half the appraised value of vacated property.

“I think a reasonable person would say, ‘Yeah, you’ve gotta consider that in the valuation,’ ” Schwartz said. “You or I are not going to buy that because we can’t build on it.”