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Kirkland must allow developer Lobsang Dargey to build a lake-view residential and commercial project under the zoning that was in place when he first applied for a permit, a judge has ruled.

King County Superior Court Judge Monica Benton found that Dargey was vested with the right to build Potala Village when he applied in 2011 for a shoreline substantial development permit.

In a decision signed Thursday and received by the city attorney Monday, Benton ordered Kirkland to accept and process a building permit based on zoning in effect in 2011.

After the high-density project south of downtown drew opposition from hundreds of residents, the City Council imposed a moratorium on development in neighborhood business zones and then adopted more restrictive zoning.

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City attorneys argued that Potala Village, with 143 apartments or condos proposed above underground parking and first-floor stores, was subject to the new zoning because Dargey hasn’t applied for a building permit.

The zoning adopted last fall would have allowed 58 units, or 48 per acre.

City Attorney Robin Jenkinson said the city was disappointed with the decision and will ask the judge to reconsider. The city has not ruled out the possibility of a negotiated settlement, she said, but, “We’re going to explore our judicial options first.”

Dargey, a former Tibetan monk best known for his projects in downtown Everett, said he was happy with the judge’s decision.

“A rule is a rule,” Dargey said. “It is very clear. It is not something that is very vague.”

Dargey said the project will go through another round of design before he applies for a building permit.

He said he wants to work with neighbors to fashion a project as acceptable to them as possible but said he can’t reduce the number of units to levels sought by many residents. “The project needs to make sense,” he said.

Dione Godfrey, who opposed the Potala Village project, directly across Lake Street South from her home on Lake Washington, said she was “just in shock because we had such hope.”

“This is my life, this is my home,” she said. “Nothing can ever be the same here with this thing across the street. It’s having a tremendous impact on me because of where I live, but it’s going to affect all of Kirkland.”

Opponents of the project complained that Potala Village was out of scale with neighboring properties, where zoning allows about one-tenth as many units per acre as Dargey has proposed to build.

Residents also objected to putting more traffic on congested Lake Street, also known as Lake Washington Boulevard Northeast.

Dargey’s property is at 10th Avenue South, about half a mile from downtown, where the city has allowed large housing and mixed-use projects.

City policies on the property were confusing, with the comprehensive plan suggesting an individual store or a very small mixed-use project, but the shoreline master plan envisioning high-intensity mixed uses.

Zoning in place when Dargey applied for a shoreline permit set no upper limit on the number of residential units that could be built.

City officials and Dargey negotiated a settlement last fall that would have allowed him to build 100 units, with the understanding the city could pay him to further reduce the size of the project.

The settlement was scuttled before it went to the City Council for approval, primarily because some members objected to paying the developer not to build some units. The council instead adopted more restrictive zoning.

Keith Ervin: 206-464-2105 or

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