Condos won't be replacing cargo on Terminal 46 anytime soon. Hanjin Shipping has agreed to extend its lease with the Port of Seattle until...

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Condos won’t be replacing cargo on Terminal 46 anytime soon.

Hanjin Shipping has agreed to extend its lease with the Port of Seattle until at least 2015, ending more than a year of speculation about whether the South Korean company would remain a fixture on Elliott Bay.

The decision is the latest blow to developer Frank Stagen, who has pushed the Port and city officials to consider transforming the 88-acre waterfront property into an urban neighborhood of condominiums, retail space, offices, parks, a basketball arena and a cruise-ship terminal.

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Port commissioners are expected to approve the agreement today.

Under the deal, Hanjin will be able to expand the terminal by up to 10 acres and will have the option to extend the lease through 2025.

Terminal 46, across from Qwest Field, is the smallest of Seattle’s three major cargo terminals. The Port has spent some $77 million in recent years to upgrade the deep-water dockyard, including adding three of the world’s largest cargo cranes.

Keeping Hanjin in Seattle was a top goal for the Port, which lost several major cargo carriers in the 1990s to the Port of Tacoma and other competitors.

“It is especially important, since we invested so much money in that terminal,” commission President Bob Edwards said. “It would sure be a sad day if they had decided to go elsewhere.”

The Port had a stronger hand going into negotiations with Hanjin than it would have had in years past. A record amount of cargo poured through Seattle last year, thanks to an explosion of trade with Asia and congestion at other West Coast ports.

Hanjin’s decision to stay put will complicate efforts to rebuild the Alaskan Way Viaduct. Construction could hamper the company’s ability to move boxes on and off the terminal, especially to the nearby railroad yard.

Stagen did not return a phone call yesterday. In recent months, he acknowledged that his dream of transforming the sprawling asphalt terminal would take longer than he had hoped.

His company, Nitze-Stagen, poured hundreds of thousands of dollars into initial plans for the property, even through the real-estate firm had no control over the land.

Stagen argued that a redeveloped Terminal 46 would create more jobs and taxes and that the Port could consolidate cargo operations on other dockyards.

J. Martin McOmber: 206-464-2022 or mmcomber@seattletimes.com