River Park Demolition Under Way

People looking for signs that the $100 million River Park Square redevelopment project will actually happen need only stroll through downtown Spokane.

Two skywalks are gone. Lincoln Street is blocked from Main to Spokane Falls Boulevard.

A sidewalk in front of Main, from Post to Lincoln, has been replaced by an enclosed wooden tunnel, and one lane of Main is closed to traffic.

Construction workers are gutting the interior of the shopping center’s west block, preparing for the arrival of the wrecking ball later this week.

Developers celebrated the demolition Monday with a news conference and “Bash for Cash” promotion. For each person who swung a hammer at the shopping center’s brick wall, $10 was donated to charity.

By day’s end, 304 people had chipped away at the building, and $3,040 was donated to Spokane Area Community Centers, the YMCA, the YWCA and Habitat for Humanity.

Among the first to swing at the wall were children from a YMCA program.

“It’ll fall,” promised one blond 4-year-old when asked what would happen to the wall when he hit it. Though it’s still standing, participants took a chunk out of the wall at 217 N. Post, next to the former Eddie Bauer outlet.

Developers, eager to move forward with the project, have come up with a different way to pay for the proposed parking garage. Funding for the garage has been held up by a lawsuit challenging the project that’s pending before the Supreme Court.

Developers plan to pay for the parking garage with revenue bonds issued by a nonpofit corporation. However, said Betsy Cowles, president of both companies that own River Park Square, Wall Street doesn’t like revenue bonds for a project tainted by a pending lawsuit.

Under the alternative plan, Cowles said, developers would take out a loan to pay for the $26 million parking garage.

Though Cowles would not reveal which financial institution would provide the loan, Roy Koegen, the city’s bond attorney, said the developers are working with a company that manages union pension funds.

“It would be a direct taxable loan with the Compass Group,” Koegen said. “Everything would be the same except that the loan would be taxable as opposed to tax-exempt and it would be a different lender.”

The revenue bonds would be tax exempt because federal law allows non-profit groups to float such bonds for public purposes. City officials and developers have argued that this project serves a public purpose because it will create jobs, generate tax revenue and provide parking.

The Compass Group is a statewide company that manages union pension funds and invests in stocks, bonds and real estate. The three local trade unions most actively involved in real estate investment are the laborers, the cement masons and the Carpenters Union. The pension fund loans are mutually beneficial because any group that receives a loan agrees to hire union labor. Among the local projects that have been funded through the pension funds are Cavanaugh’s Inn at the Park, the Rockwood Clinic and hospital expansions.

River Park Square project manager Bob Robideaux said an announcement about project financing could be made within two weeks.

Regardless of how the project is paid for, it’s moving forward. The majority of the retail space has been spoken for, Cowles said Monday.

“What you’ll see is a tenant line-up that’ll knock your socks off,” Cowles said, declining to name any of the retailers. All of the storefront spaces on the street level of Main have been taken, she said, along with much of the second floor and spots fronting Spokane Falls Boulevard.

One tenant that has signed a lease for the new River Park Square is Anderson and Emami, which will move from its current location at Main and Post at the end of November. The 12-year downtown clothier will move across Main into the J.C. Penney building to liquidate its remaining merchandise, then will close for more than a year until the project is complete. When the project reopens in mid-1999, Anderson and Emami will move back into the space at Main and Post.

Monday’s event also had political overtones as Cowles took a jab at mayoral candidate John Talbott, before turning the podium over to Mayor Jack Geraghty.

“Great cities aren’t built with inactivity or negativism,” Cowles said, before commending Geraghty and the City Council for supporting the project. Following her speech, she and Geraghty swung at the wall together with hammers.

Talbott, who attended Monday’s event, has been labeled a naysayer in part because he has spoken out against the city’s support for the River Park Square project. He also is a plaintiff in the lawsuit challenging the city’s involvement in the development. Talbott said he supports the project itself and is happy that it’s going forward. However, he said he still disagrees with certain City Council actions.

“The unfortunate thing here is that our mayor and council have denied the people the right to vote on this issue,” Talbott said, referring to an emergency ordinance passed by the council that pledges the city’s parking meter money as back-up funding for the project.

River Park Square is owned by Citizens Realty Co. and Lincoln Investment Co., affiliates of Cowles Publishing Co., owner of The Spokesman-Review.

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