More than a dozen new apartment projects have risen in downtown Bellevue in the past few years, making it the fastest-growing neighborhood in the city by far — presenting opportunities for economic prosperity and issues like gridlock on the roads.
Downtown Bellevue is transforming into a dense residential neighborhood reminiscent of a mini-Seattle across the lake, with new apartment towers packing more residents into an area that was once just a place where visitors worked and shopped.
After halting just about all construction during the recession and its aftermath, developers have built more than a dozen new apartment projects in downtown Bellevue over the past four years. And city leaders are preparing for a lot more growth downtown, with an eye toward allowing even taller buildings.
The added density is bringing headaches — including added gridlock on the roadways and sky-high prices for new housing. But the changes are also creating what officials call a more lively, energetic neighborhood alluring to young people.
Nowhere is the frenzy more evident than at Lincoln Square, where Kemper Development is building a 450-foot-tall apartment building — tied for the city’s tallest structure — on top of a W Hotel.
When residents begin moving into the pricey luxury apartments in the fall, they’ll be within walking distance of dozens of restaurants and shops. Jim Melby, president of Kemper Development, said the area “is becoming its own urban core.”
Mara and David Duncan, a young couple living in Bellevue, have already pre-leased an apartment in the project. They see downtown Bellevue as something between an urban jungle and the classic picture of suburbia — saying they can walk everywhere, but people in shops still know their names.
“Seattle has more of a big-city feel — it reminds me of New York,” Mara Duncan said while scoping out the shell of her future apartment, still under construction. “Here, it functions like a town.”
City officials say downtown is now Bellevue’s fastest-growing neighborhood by far — having increased fivefold since 2000 — and residents there are getting younger. Downtown now has about 13,000 residents, or 10 percent of Bellevue’s population.
“A lot of the millennials, they want to be where the action is,” said Mike Brennan, Bellevue’s development services director. “That’s why they’re building this stuff. There’s a market for it. It’s creating a lively, energetic, interesting neighborhood where people want to live.”
And while it doesn’t have the transit or nightlife options of Seattle, downtown Bellevue residents and visitors give the area high marks for safety and cleanliness. According to a city survey, only 2 percent of residents feel unsafe walking downtown alone during the day, and 14 percent feel that way at night.
Overall, construction in Bellevue’s downtown has been brisk.
Since the latest development cycle began in 2013, the downtown has seen $800 million worth of new projects shoot up, with $100 million more about to begin, according to permit data provided by the city. That matches the construction volume from the last boom, before the recession brought development nearly to a halt.
The difference this time is that the surge is mostly apartments, unlike the condo and office towers that popped up last decade. Apartments are generally seen by developers as a safer investment, and during the downturn a few developers turned condos into apartments in downtown Bellevue and Seattle.
But now at least two companies are planning the city’s first new condos in a decade. One is Plus Investment, a Bellevue and Chinese company that has a vision for four mixed-use towers as part of its Elev8 project, the biggest single development by square footage in the city’s history.
Like Kemper, the Elev8 developers envision an urban mecca. Plans show wide public plazas with shops and a movie theater below apartments and condos. Construction is set to begin this summer for the first phase, to include two luxury residential towers totaling about 800 condos and apartments. The homes could open in 2020.
Despite the residential focus, a few major office and retail projects are underway or were recently completed.
At the Kemper site, a neighboring office high-rise just about finished is more than 90 percent leased by companies like Valve, Samsung and Pokémon, as well as billionaire Steve Ballmer. It includes restaurants offering high-rise patio dining.
A block away, Amazon is taking over a new office tower with room for more than 2,000 employees.
Overall, office construction in the current development cycle has added 1.5 million square feet of office space to downtown, or a 20 percent increase. Most of that space has already been leased, more than offsetting the big upcoming loss of Expedia, which is set to move to Seattle as soon as 2019 but is keeping a satellite office behind in downtown Bellevue.
Traffic, housing costs
With the changes have come setbacks: Traffic has gotten worse, and the city doesn’t have the transit infrastructure to support a car-free lifestyle for most, as evidenced by the thousands of new parking spots going underground.
Some suburbanites aren’t fond of the increasing urbanization of their town. And despite all the new construction, housing prices are still skyrocketing to among the highest rates in the state.
At the Kemper site, fewer than 20 percent of the 218 units have been pre-leased about six months ahead of the apartment tower’s opening.
The luxury apartments cost about $1 million each to build, Melby said. They include high-end finishes like quartz countertops and Sub-Zero refrigerators, services like wine lockers and valet parking, and sweeping views ranging from the Seattle skyline to Mount Rainier.
Rents range from $3,375 for a one-bedroom to $25,000 for a penthouse. Under the standard advice to spend 30 percent of income on rent, even the cheapest units there would require a salary of $135,000.
But the apartments already snatched up have skewed toward higher-end units.
Across downtown Bellevue, rents have shot up 35 percent in the last five years, to a new average of $2,540, according to Zillow. Even more dramatic, downtown home prices are up 65 percent since 2012 to an average of $690,000 for all home types, even though most homes in the area are smaller condos.
For existing residents, the growth has caused other problems. Bill and Michele Herman, who live in a condo downtown, said the construction boom has added to traffic in the area.
“Already, you see different driver behavior,” said Bill Herman, noting that a friend was hit by a car while walking on the sidewalk in recent weeks.
The couple say the city needs to focus density near transit and ensure enough open space is protected.
“We like urban living; that’s why we’re here,” Michele Herman said. “But we do worry that the existing infrastructure is not well planned out to support it.”
Despite the urban focus, much of the development is still suburban-friendly. The Kemper residential tower includes about 400 new parking spaces — among 12,500 stalls in the Lincoln Square complex — and elevated skybridges connect buildings so people don’t have to cross at street level. The Elev8 project includes a whopping 1,450 underground parking spaces.
Future of downtown
There are conflicting views on how much longer the development cycle will last, but Bellevue still has plenty of room to grow.
Patrick Bannon, who leads the Bellevue Downtown Association, estimates about 40 percent of the downtown area could be built on or redeveloped with taller buildings. New light-rail stations coming next decade will likely add to the demand.
The city is still winding through a lengthy process to figure out how best to add more density to downtown, with an eye toward taller, more slender buildings and changes to make walking easier.
It’s the first change in three decades to the downtown zoning, which allows for buildings up to 450 feet tall at the center, with heights tapering off toward the edges near single-family-home neighborhoods.
The finished product will essentially guide development in the downtown for future decades.
The plan has been contentious and voluminous: It took 13 meetings during 2013 and 2014 for a citizens group to come up with recommendations, and the planning commission has been poring over the details for the last two years.
Among the plan’s goals: Increase the width of sidewalks, encourage more unique buildings and a “memorable” skyline, add affordable housing (perhaps through granting extra density to developers who include subsidized housing), and focus density near the coming light-rail stations.
At a public hearing last month, about 40 people showed up to wade into the nitty-gritty details of the land-use code changes, which took city officials 700 pages to summarize in a report for the meeting.
Developers said they supported the general concept of adding density but wanted to build even more. Some residents were worried about the issues that could bring, especially with so much development being concentrated in the relatively small, six-by-six-block downtown.
“We simply do not know how our (transportation) system is going to function under the full buildout,” Todd Woosley, a Bellevue resident who serves on the city’s transportation commission, said at the hearing.
Others wrote in to the city with concerns.
“Zoning should remain as is until the current traffic, parking, and public safety problems are addressed and fixed,” Melanie Lee, a downtown resident, told officials in an email. “Thousands of new neighbors and workers will be moving into the many new buildings that are still under construction. This will only make the situation worse.”
Development is probably the most controversial issue in town: In a recent city survey, residents who said Bellevue was headed in the right direction cited development and growth as the No. 1 reason. Those who thought Bellevue was headed in the wrong direction also cited development as their top reason.
The changes could accelerate construction. The city as a whole has seen $3 billion worth of all types of construction projects in the last four years, up from $1 billion during the downturn over the four prior years.
“It has been a dramatic transformation,” said Bannon, of the Downtown Association. “Compared to Seattle, the growth and pace of change in downtown Bellevue may have been overshadowed a bit, but it’s been very strong nonetheless.”