The developer of the Olive 8 hotel and condominium project in downtown Seattle will pay nearly $1 million into a King County fund for permission...

The developer of the Olive 8 hotel and condominium project in downtown Seattle will pay nearly $1 million into a King County fund for permission to add three more floors to their project, giving it the title of city’s tallest residential building.

King County will then use the money to buy development rights to 300 to 400 acres in rural King County under a deal expected to be announced today, said County Council Chairman Larry Phillips.

The money will go to the county’s Transfer of Development Rights program, which was established about 10 years ago to preserve the rural landscape in eastern King County and encourage growth in urban areas, Phillips said.

Olive 8 developer R.C. Hedreen Co. had been planning a 36-story tower at the corner of Eighth Avenue and Olive Way, with opening set for summer 2008. The additional three floors would put it a notch above another downtown condo project called 1521, which will be 38 stories.