Exhibit J Bally's Development AgreementDRAFT FOR DELIBERATION v. 6/2/2022
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DEVELOPMENT AGREEMENT
THIS AGREEMENT is entered into this _____ day of __________________, 2022 (the
“Effective Date”) by and between FIRST AVENUE SOUTH APARTMENTS LLC, a Washington
limited liability company (the “Owner”), and the City of Federal Way, a Washington municipal
corporation (“City”). Owner and the City are each a “Party” and collectively the “Parties” to this
Agreement.
RECITALS
A. The Washington State Legislature has authorized the execution of development
agreements between a local government and an entity having ownership or control of real property
within its jurisdiction, pursuant to RCW 36.70B.170 through 36.70B.210 (“Development
Agreement Statute”). This Agreement is authorized pursuant to the Development Agreement
Statute and the Federal Way Revised Code (“FWRC” or “Code”) Chapter 19.85, as established by
Ordinance 02-426.
B. Owner owns the property at 32818 1st Avenue South in Federal Way, Washington
(King County Assessor No. 1721049038 and the “Property”), legally described on Exhibit A,
which is attached hereto and incorporated herein by reference.
C. Owner applied for a Comprehensive Plan land use designation amendment and
associated rezone of the Property from Office Park (“OP”) to Multifamily Residential RM-1800
zone (“RM-1800”) under City File No. 20-103733-00-UP (collectively, the “Rezone”).
D. Owner has prepared a conceptual site plan development of the Property dated
____________, 2021 as depicted in Exhibit B (“Conceptual Plan”), which is attached hereto and
incorporated herein by reference. The Parties agree the Conceptual Plan is a conceptual guide for
the development of the Project as defined in this Agreement, but is not intended to be, nor must it
satisfy the requirements of a “Development Plan” as defined in FWRC 19.85.100.
E. Redevelopment of the Property consistent with the Conceptual Plan will be a
benefit to the City through implementation of the vision of the Comprehensive Plan by, among
other reasons, providing new market-rate housing opportunities for City residents.
F. Redevelopment of the Property also supports and implements the City’s recently
adopted Housing Action Plan objectives and strategies, including Objective 1 to “promote new
market-rate…construction that expands housing choices” and Objective 2 to “encourage
homeownership opportunities and support equitable housing outcomes” by providing new market-
rate housing choices for City residents and the potential for future homeownership opportunities.
G. The City desires to enter into this Agreement to assure the development of the
Property consistent with the Conceptual Plan as a condition of the approval of the Rezone.
H. By this Agreement, the Parties intend to set forth their mutual agreement and
understandings as they relate to the development of the Property.
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NOW THEREFORE, in consideration of the mutual benefits and agreements contained
herein, as well as other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:
AGREEMENT
1. Definitions.
1.1. “City Council” means the City Council of the City of Federal Way.
1.2. “Development Regulations” means those sections of the Federal Way Revised
Code, Federal Way Zoning and Development Code, Federal Way Comprehensive Plan,
Federal Way Zoning Map, and any implementing policies, regulations, procedures or
guidelines addressing the zoning, building and site design, utilities, environmental review
(including SEPA procedures and substantive authority), transportation concurrency, and
any other elements that govern the development of real property within the City. A term
defined in the Development Regulations shall have the meaning assigned to it within the
Development Regulations, unless otherwise defined herein.
1.3. “Market-rate” means a type of housing available or offered in the open market
without public, nonprofit, or similar subsidies; provided however, nothing in this definition
shall prohibit housing purchasers from utilizing commercially available affordable housing
financing mechanisms for owner financing of individual units, if offered for sale.
1.4. “Owner” means FIRST AVENUE SOUTH APARTMENTS LLC, a Washington
limited liability company, and its successors and permitted assigns pursuant to Section 11.
1.5. “Development Director” is the Director of the Department of Community
Development.
1.6. “Townhouse” shall have the same meaning as in FWRC 19.05.200, except that it
shall expressly exclude zero lot line townhouses as defined in FWRC 19.05.040.
1.7. Each term defined within the Agreement shall have the meaning assigned to it
within the Agreement.
2. Purpose. As a condition of the City’s approval of the Rezone authorized by Ordinance
_________, this Agreement governs Owner’s right to develop the Property pursuant to the RM-
1800 zoning subject to the Public Benefits and the Development Regulation modifications defined
in Section 3.
3. Project. The Owner shall develop the Property with a Townhouse community generally
consistent with the Conceptual Plan (collectively, the “Project”) subject to the following
conditions:
3.1. Public Benefits. The Project shall provide the following public benefits:
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a. Market-rate Townhouses. Development of the Property shall be limited to
a Market-rate Townhouse community. Within sixty (60) days of issuance of the
Certificate of Occupancy for the final Townhouse in the Project, the Owner shall
execute and record a Map in the form required by RCW 64.90.245 and a
Declaration in the form required by RCW 64.90.225, to create a residential
condominium community that allows each individual Townhouse to be sold as a
condominium; provided, however, nothing in this provision shall require Owner to
sell any individual Townhouse as a condominium and the Property may operate as
a “for rent” apartment community at the sole discretion of Owner.
b. Dedicate garage parking. Each Townhouse shall provide privately
accessible two (2) stall garage parking, which may be in a tandem configuration.
c. Access to open space. Open space provided by the Project shall comply
with FWRC 19.205.010 and shall provide access directly to private yards and/or
balconies from each Townhouse.
d. Amenities building. Owner shall design and construct any permanent
leasing or sales office and common amenity building in the Project to be
substantially in the same architectural style as the Project’s Townhouses.
3.2. Development Regulation Modifications. The Parties agree that the Development
Regulations shall apply to the City’s review of the Project; provided however; as a
component of this Agreement, the City approves the following modifications for the
Development Regulations applicable to the Project:
a. Parking. Each Townhouse shall have 2 garage parking stalls. Guest parking
shall be surface-parked and provided at a 1 stall per 6 dwelling unit ratio.
b. Minimum building separation. The minimum required separation between
structures shall be 10 feet.
4. Vesting. Except as provided in Sections 4.1 and 4.2, and as may otherwise be prohibited
by law, Owner shall be entitled to develop the Project under the Development Regulations and
land use controls in effect as of the Effective Date of this Agreement (“Vested Code Provisions”),
which shall apply for the Term of this Agreement.
4.1. Exemptions. The following are exempt from vesting under this Agreement:
a. Plan review fees, inspection fees, and other land use application fees;
b. Connection charges, general facilities charges and monthly service charges;
c. Amendments to building, plumbing, fire and other construction codes adopted
pursuant to RCW Ch. 19.27 or 19.27A;
d. Impact fees authorized by state law; and
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e. City enactments that are adopted pursuant to state or federal mandates (such as
the City’s NPDES Municipal Stormwater Permits) that preempt the City’s authority
to vest regulations;
4.2. Reserved Rights. Notwithstanding any provision in this Agreement, the City
reserves authority pursuant to RCW 36.70B.170(4) to impose new or different
Development Regulations to the extent required by a serious threat to public health or
safety, as determined by the City Council after written notice and an opportunity to be
heard by Owner.
4.3. Future Agreement Modifications, Amendments, and Procedure. Modification
and/or amendment of this Agreement shall be governed by the procedures in FWRC
19.85.200–.210.
4.4. Further Discretionary Actions. Owner acknowledges that the Project requires
further discretionary review by the City. Nothing in this Agreement shall be construed to
limit the authority or obligation of the City to hold legally required public hearings for the
Project, or otherwise limit the discretion of the City in reviewing the Project as authorized
by the Development Regulations and terms of this Agreement.
5. Agreement to Run with the Land. The benefits and obligations of this Agreement shall run
with the land and continue following the subdivision, leasing, or transfer of ownership to Owner’s
successors and assigns in accordance with Section 12.
6. Term. The term of this Agreement shall be ten (10) years from the Effective Date of this
Agreement (“Expiration Date”).
7. Construction of Documents. In the event there are any conflicts or ambiguities between
the terms of the body of this Agreement and the terms in any of the Exhibits, the terms of the body
of this Agreement shall control.
8. Recitals. The Recitals are incorporated herein as material terms of this Agreement.
9. Agreement Consistency with RCW 82.02.020. The Owner agrees that the improvements,
mitigation payments and dedications established by this Agreement shall be consistent with the
requirements of RCW 82.02.020 and mitigate the direct impacts that have been identified as a
consequence of the Project.
10. Recording. This Agreement shall be recorded by Owner with the King County Recorder’s
Office.
11. Binding Effect; Assignability. This Agreement shall bind and inure to the benefit of the
Parties hereto and their respective successors, heirs, legatees, representatives, receivers, trustees,
successors, transferees and assigns. Owner shall have the right, in its sole discretion, to assign or
transfer its rights, in whole or in part, under this Agreement. Owner shall provide City with written
notice of any transfer or assignment at least thirty (30) days prior to the closing of any transaction.
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12. Interpretation. This Agreement has been reviewed and revised by legal counsel for both
Parties, and no presumption or rule construing ambiguity against the drafter of the document shall
apply to the interpretation or enforcement of this Agreement. Nothing herein shall be construed
as a waiver of the City’s constitutional and statutory powers. Nothing herein shall be construed or
implied that the City is contracting away its constitutional and statutory powers, except as
otherwise authorized by law.
13. Authority. Each signatory to this Agreement represents and warrants that he or she has full
power and authority to execute and deliver this Agreement on behalf of the Party for which he or
she is signing, and that he or she will defend and hold harmless the other Parties and signatories
from any claim that he or she was not fully authorized to execute this Agreement on behalf of the
person or entity for whom he or she signed. Upon proper execution and delivery, this Agreement
will have been duly entered into by the Parties, will constitute as against each Party a valid, legal
and binding obligation that shall run with the land, and will be enforceable against each Party in
accordance with the terms herein.
14. Delays. If either Party is delayed in the performance of its obligations in this Agreement
due to Force Majeure, then performance of such obligation shall be excused for the period of delay.
Force Majeure means extraordinary natural events or conditions such as war, riot, labor disputes,
pandemic (including but not limited to COVID-19 or its variants) or other similar causes beyond
the reasonable control of the obligated party.
15. Notices. All notices, requests, demands, and other communications called for or
contemplated by this Agreement shall be in writing, and shall be duly given by mailing the same
by certified mail, return receipt requested; or by delivering the same by hand, to the following
addresses, or to such other addresses as the Parties may designate by written notice in the manner
aforesaid:
Owner: FIRST AVENUE SOUTH APARTMENTS LLC
C/O Weidner Apartment Homes
Attn: Kevin Colard
9757 NE Juanita Drive, Suite 300
Kirkland, WA 98034
Email: kevin@weidner.com
And to its Attorney: McCullough Hill Leary, P.S.
Attn: Ian Morrison
701 5th Avenue, Suite 6600
Seattle, WA 98104
Phone: 206-812-3380
Email: imorrison@mhseattle.com
City of Federal Way: Community Development Director
Attn: Brian Davis
33325 8th Ave South
Federal Way, WA 98003
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Phone: 253-835-2612
Email: Brian.Davis@cityoffederalway.com
And to its Attorney: City Attorney’s Office
Attn: Kent van Alstyne
33325 8th Ave South
Federal Way, WA 98003
Phone: 253-835-2562
Email: Kent.VanAlstyne@cityoffederalway.com
16. Dispute Resolution. It is the Parties’ intent to work cooperatively and to resolve disputes
in an efficient and cost-effective manner. All disputes arising out of or relating to this Agreement
shall be resolved as follows:
16.1. Settlement Meeting. If any dispute arises between the parties relating to this
Agreement, then the parties shall meet and seek to resolve the dispute, in good faith, within
ten (10) days after a Party’s request for such a meeting. The City shall send the Community
Development Director, or a designee with information relating to the dispute, and Owner
shall send an owner’s representative or person with technical information or expertise
related to the dispute.
16.2. Mediation. If the Parties cannot resolve the issue within ten (10) days then they
shall mediate the matter using a mediator from Judicial Dispute Resolution, LLC or if that
entity fails or declines to serve, such other similar service or organization as agreed by the
parties, or as appointed by the court if the parties cannot agree (collectively “JDR”), within
seven (7) days of their failure to agree pursuant to Section 16.1. The Parties shall evenly
split any fees charged by JDR, regardless of the outcome of the mediation. Each party shall
bear its own attorneys’ fees in connection with the mediation. If the Parties have still not
resolved the matter following the mediation, then and only then shall judicial action be
permitted.
17. Governing Law and Venue. This Agreement shall be governed by and construed in
accordance with the laws of the State of Washington. To the extent permitted, venue for any
judicial action arising out of or relating to this Agreement shall lie in King County Superior Court.
18. Specific Performance. The Parties specifically agree that damages are not an adequate
remedy for breach of this Agreement and that the Parties are entitled to compel specific
performance of all material terms of this Agreement by any Party in default hereof. All terms and
provisions of this Agreement are material.
19. Attorneys’ Fees. In any judicial action to enforce or determine a party’s rights under this
Agreement, the prevailing party (or the substantially prevailing party, if no one party prevails
entirely) shall be entitled to reasonable attorneys’ fees, expert witness fees, and costs, including
fees and costs incurred in the appeal of any ruling of a lower court.
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20. No Third-Party Beneficiary. This Agreement is made and entered into for the sole
protection and benefit of the parties hereto and their successors and assigns. No other person shall
have any right of action based upon any provision of this Agreement.
21. Severability. This Agreement does not violate any federal or state statute, rule, regulation
or common law known; but any provision which is found to be invalid or in violation of any statute,
rule, regulation or common law shall be considered null and void, with the remaining provisions
remaining viable and in effect.
22. Cooperation in Execution of Documents. The Parties agree to properly and promptly
execute and deliver any and all additional documents that may be necessary to render this
Agreement practically effective. This Paragraph shall not require the execution of any document
that expands, alters or in any way changes the terms of this Agreement.
23. Exhibits. This Agreement includes the following exhibits which are incorporated by
reference herein:
Exhibit A – Legal Description of Property
Exhibit B – Conceptual Plan
24. Full Understanding. The Parties each acknowledge, represent and agree that they have
read this Agreement; that they fully understand the terms thereof; that they have had the
opportunity to be fully advised by their legal counsel and any other advisors with respect thereto;
and that they are executing this Agreement after sufficient review and understanding of its
contents.
25. No Joint Venture. This Agreement is not intended to and nothing in this Agreement shall
create any partnership, joint venture or other arrangement between the Parties.
26. Final and Complete Agreement. This Agreement is integrated and constitutes the final and
complete expression of the Parties on all subjects relating to the development of the Property. This
Agreement supersedes and replaces all prior agreements, discussions and representations on all
subjects discussed herein, without limitation. No Party is entering into this Agreement in reliance
on any oral or written promises, inducements, representations, understandings, interpretations or
agreements other than those contained in this Agreement and the exhibits hereto.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date first set
forth above.
FIRST AVENUE SOUTH APARTMENTS LLC,
a Washington limited liability company
By:
Name:
Its:
CITY OF FEDERAL WAY,
a Washington municipal code city
By:
Jim Ferrell, Mayor
ATTEST:
Stephanie Courtney, CMC, City Clerk
APPROVED AS TO FORM:
J. Ryan Call, City Attorney
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STATE OF WASHINGTON )
) ss.
COUNTY OF ____________ )
On this day personally appeared before me ______________________, to me known to be the
_______________________ of First Avenue South Apartments LLC that executed the foregoing
instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said limited
liability company, for the uses and purposes therein mentioned, and on oath stated that he/she was
authorized to execute said instrument.
GIVEN my hand and official seal this ______ day of ______________________, 20__.
Notary’s signature _____________________________________
Notary’s printed name _____________________________________
Notary Public in and for the State of Washington.
My commission expires__________________
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EXHIBIT A
LEGAL DESCRIPTION
Lot 1 of the revised King County Short Plat 1075046, Recording #7706100878.
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EXHIBIT B
CONCEPTUAL PLAN