Make vacant strip malls part of solution to WA’s housing crisis

As more brick-and-mortar retailers close their doors in towns and cities across the country, they frequently leave behind gaping carcasses — empty buildings surrounded by parking lots in once-vibrant commercial corridors.

All the while, Washington continues to face a housing crisis. Unaffordability and homelessness are the results of a state with 138,000 fewer units than it needs, according to Up for Growth, a housing policy group. The state’s Commerce Department expects that number to grow to 1 million by 2044.     

There is a promising solution. Moribund commercial properties could be rezoned and rebuilt as high-density residential developments. Senate Bill 5749, sponsored by Sen. Jeff Wilson, R-Longview, would enable Washington cities to create “opportunity zones” where impact fees could be waived for project developers.

Amid a number of housing bills working through Olympia this session, Wilson’s was a part of Lt. Gov. Denny Heck’s housing recommendations to Gov. Bob Ferguson. It’s a novel tool that could add critically needed housing. The Senate has already passed the bill; the House should follow suit and Ferguson should sign it.

If so, Washington would follow California, where lawmakers in 2022 passed even better legislation that required affordable housing on projects. A consultant estimates Washington could add a whopping 675,000 units if underused strip malls and shopping centers were converted to housing.   

Former Washington Gov. Christine Gregoire and Microsoft President Brad Smith, as part of their work for the Challenge Seattle alliance, have also pressed this worthy case.

“ … The thing we need most is not more money but more land,” Smith opined in a column earlier this year. “People understandably don’t want to turn a cul-de-sac with single-family homes into multiunit complexes. And that’s not needed.” 

In the Puget Sound region, cities including Kirkland have already helped foster projects that have brought residential units to underused commercial zones like the vibrant Totem Lake development. Wilson’s bill would allow cities to rezone areas now, rather than having to wait for reviews of their state-mandated comprehensive plans.

The benefits go beyond new housing potential. These developments could access existing water and sewer utilities, road networks and even bus lines, rather than having to fund costly extensions for all of those services to sprawling developments farther from the city center. That’s good for the climate and the preservation of green space.

Wilson’s bill is only a start. More should be done to fast-track projects and offer tax abatement, like the multifamily property tax exemption. To those who would flinch at offering tax breaks to developers, ask: Is it better to let these commercial eyesores fester, or open them to the prospect of housing people, generating new tax revenue that will more than replace any development’s initial tax abatement?

With the Legislature’s approval, cities can give underperforming commercial zones a new lease on life. Given the depths of the housing crisis, just one project penciling out would make Wilson’s bill worth doing.