Five days after the council gave Dakota Pacific Real Estate a major counterproposal for Kimball Junction, the developer said items on councilmembers’ “wishlist” are in conflict with one another.
Dakota Pacific hopes to develop roughly 50 acres on the junction’s west side, adjacent to the Skullcandy headquarters and Sheldon Richins Building, with housing. That land is zoned for more office space, the equivalent of 24 more Skullcandies.
The developer’s latest ask is 727 units. Feb. 8, the council said it needs to be 500.
Councilmembers also wanted Dakota Pacific to up the amount of affordable housing, cut market rate and integrate things like a park-and-ride, medical facilities and continuing care for seniors.
“There is no way we'll ever get anywhere close to that type of a program,” Dakota Pacific CEO Marc Stanworth said Feb. 13. “And I'll kind of describe a little bit of some of the reasons why.”
Constraints on development
The first reason is reducing density means the least profitable parts of the project get cut first. And if that can’t be affordable housing, Stanworth said, it has to be the market rate apartments.
He told the council that would cut against the county’s goals around housing local workforce.
Market rate apartments are attainable for people earning higher salaries and wouldn’t be geared toward real estate investors or second homeowners like townhomes and condos are, he said.
According to a recent Park City staff report, the median household income is $140,147 among owner-occupied units in Park City proper.
"Conversely, the median household income for renter-occupied housing units is $79,295," staff wrote.
Stanworth also said Dakota Pacific’s staff is working on the council’s preferred affordability ratios: a third of those units for people making less than 40%, 60% and 80% of the area median income.
But those ratios would disqualify Dakota Pacific from receiving federal Low Income Housing Tax Credits, meaning even higher costs and slimmer margins.
At the end of the day, Director of Commercial Development Steve Borup explained, Dakota Pacific’s investors need to know they’ll get their money back.
And the longer the planning process takes, the developer keeps paying taxes and other holding costs on its unimproved land. That’s another reason delaying the project to allow for hypothetical road improvements in the junction may not work.
Then there’s the matter of continuing care and an expanded park-and-ride. The council likes the idea of putting a capture lot between the Richins Building and Park City Visitors’ Center.
But Stanworth said that’s the same place continuing care operators have said is best for their business.
It’s another conflict that needs to be resolved, but the council and developer seem resolved to keep working together.
Potential for compromise
The public hearing and decision that were only days away have been tabled to allow for more negotiation between the two parties’ preferred plans and densities.
“So figuring out how we can come to some sort of arrangement that is a compromise between the two—what that might look like at this point,” Council Chair Malena Stevens said at the latest meeting.
Vice Chair Tonja Hanson wanted the developer to see if there is a number of units between 727 and 500 it could accept. Stanworth ballparked reducing density by 10s and 20s of units rather than by 100s.
Councilmember Roger Armstrong also hoped the developer can come back with ideas about other ways to generate revenue, other than market rate housing. However, Stanworth has said commercial square footage generates less than half the revenue housing does.
If it comes down to using market rate housing to pay for the affordable units, Dakota Pacific wants to know the council’s priority: reducing units or increasing affordable ones. Stevens said the next special meeting can begin with that discussion.
The talks have progressively focused more on minutiae, but from County Attorney Margaret Olson’s standpoint, it looks like progress.
“It may not feel like it because it's laborious, and it's hard,” she said Feb. 13. “But I think that we should continue with the process that we're doing. And I think this is productive right now.”
The next discussion is scheduled for Thursday, Feb. 22, at 3 p.m. in the Richins Building.
