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Spokane, Washington  Est. May 19, 1883

Woodward: City won’t negotiate purchase deal for east Spokane warehouse leased for homeless shelter

Mayor Nadine Woodward has rejected a Spokane City Council resolution to enter into purchase negotiations for 4320 E. Trent Ave. The building is owned by developer Larry Stone through an LLC, Lawrence B. Stone Properties No. 4320.  (COLIN MULVANY/THE SPOKESMAN-REVIEW)

Spokane Mayor Nadine Woodward has no plans to negotiate a purchase of the East Trent Avenue warehouse earmarked by the city as a 150- to 250-bed homeless shelter.

Instead the city is leasing 4320 E. Trent Ave. from developer Larry Stone. The five-year lease includes an option to buy the property. In a split vote Monday, the Spokane City Council requested the administration explore purchase negotiations.

“At the end of it, whether we sell it or we use it for another opportunity for the city to use, who knows at what type of capacity, it will be another resource,” said Councilwoman Betsy Wilkerson. “It will not, I feel, be an albatross around our neck if we own it instead of just renting it.”

Stone – who purchased the property in late March for $3.5 million, according to Spokane County property records – is facilitating a series of renovations funded from undisclosed private sources to the warehouse, such as lighting improvements, fencing repairs and dividing the facility with temporary wall sections.

Figuring those improvements could put the building’s price at more than $4 million. Woodward has said spending that kind of money on the property without knowing how long the city will need it is not the “wisest investment.”

“We have a five-year lease agreement with the option to end it sooner,” Woodward said Tuesday. “Depending on projects that are in discussion now and where that puts us with our shelter capacity in the next few years, we may not need that building. And so it’s much cheaper, let’s say we had it for three years, to lease it than to purchase it and maintain it.”

The option to buy is available through the first six months of the lease agreement. It calls for an appraiser who would be agreed upon by the landlord and the city. Nothing in the contract would hold Stone to that appraiser’s price, however.

The lease also includes an early termination clause at the cost of eight months’ of rent. The base rent, plus a 2.5% lease management fee, puts the monthly cost at $26,752.50. That puts the estimated cost of the lease over the five years over $1.6 million.

Woodward said the “House of Charity 2.0” concept through Catholic Charities of Eastern Washington could have some bearing on how long the city might need the Trent shelter. Announced in late April during Woodward’s State of the City address, Catholic Charities plans to relocate the House of Charity shelter to a larger campus somewhere outside of downtown Spokane.

A proposal is in the works from the city, Spokane County and other neighboring jurisdictions to seek out $24.3 million offered by the state Department of Commerce to support efforts to relocate the hundreds of people living in the Camp Hope homeless encampment at East Second Avenue and Ray Street.

Woodward said projects outlined in that proposal, if approved by Commerce, could also factor into the city’s need for the Trent property in the coming years.

“We don’t do the best job of maintaining buildings we already have,” she said, “so I don’t want to add more real estate that requires more cost and more staff.”

Council President Breean Beggs sponsored Monday’s resolution asking the city to negotiate a purchase. Beggs said he feels the city needs a dedicated place for people in the event of excessive heat, cold or smoke.

“One of the reasons I like this building is that it will have space for 150 to 250 people on a regular basis, but it has surge capacity,” he said. “So I think we need it. It will save lives and save money in the long run to just have that.”

The council approved the nonbinding resolution to ask the city to enter into purchase negotiations with a 4-3 vote, with council members Jonathan Bingle, Michael Cathcart and Karen Stratton opposed.

“I don’t think either way is a bad way to go,” Bingle said. “I think it’s necessary for what we’re trying to do. Winter is closely approaching. Smoke is coming. Having a place to be able to provide shelter for people in desperate times is going to be good.”

Cathcart said he was told “explicitly” from the administration that the series of improvements facilitated by Stone would “go away” if the city were to purchase the building. A private sector arrangement, one officials have been unwilling to go into detail about, is funding those improvements.

Chris Patterson of Hello for Good, a Washington Trust Bank-backed business coalition formed to address homelessness in Spokane, characterized Cathcart’s understanding as inaccurate, however, saying the organization has been working hard to make sure the shelter comes to fruition and “we want the politics to stay out of it.” Stone is a member of Hello for Good’s steering committee.

“As far as the tenant improvements, no. We, as Hello for Good, have never said that’s going to disappear,” Patterson said. “They would still be going forward full speed.”

Stone could not immediately be reached for comment.

Stratton, meanwhile, maintained that she does not believe the Trent location is an appropriate place for a homeless shelter.

“Again, I think it’s warehousing people. I think we can do better,” Stratton said, “and I think our efforts and our money can be focused on bigger and better ideas, but this one isn’t doing it for me.”