By Stacy Nguyen
Northwest Asian Weekly
The Lees’ commercial property in Lynnwood, now fenced because it is vacant.
The hope is that in 2021 and 2024, people living near Northgate and Lynnwood can all enjoy fast and reliable transit between South Snohomish County all the way down to Sea-Tac airport.
However, for some property owners, the construction of the Sound Transit Link light rail has already proved to be a costly headache.
Po Lee, 68, his wife, Yu Ling (also called Amy), 65, co-own a commercial real estate property at 44th Avenue West in Lynnwood with Jim and Anna Hau. This is a single-story building containing five retail suites just east of the Lynnwood Transit Center.
“We bought this property in the early 1990s,” said Po. “We weren’t planning on selling it. We wanted to use it as an income source during our retirement.”
However, because of this building’s location, the Lees were approached by Sound Transit in the fall of 2015 because Sound Transit wanted to acquire the property in order to construct the Lynnwood Link Extension of the light rail, which is slated to start service in 2024.
(Construction on the link is slated to begin in 2019.)
“Sound Transit reached out to start pre-acquisition discussions [with the Lees in 2015],” confirmed Kimberly Reason, Sound Transit Senior Public Information Officer. Reason said that these discussions start while the Link Extension project was still in its design phase.
The Lees are alleging that this acquisition process has put undue hardship on them. They claim that Sound Transit has disrupted their livelihood by threatening, starting, stopping, and restarting the process of acquiring their property through condemnation (also called eminent domain), starting in 2016 after pre-acquisition discussions were not fruitful.
Eminent domain is the right of a government to take private property — physical possession as well as legal title to the property — for public use with just compensation to the property owner(s).
Yong-na Mar’s rental property in Northgate
Yong-na Mar
With her late husband, George, Yong-na Mar purchased a residential rental property at 5th Avenue Northeast in the Northgate neighborhood of Seattle, one also currently being acquired by Sound Transit. Mar is an immigrant and does not speak English proficiently enough to navigate through this process, so she heavily relies on her brother-in-law, Gary Low.
“Nobody is challenging the right of eminent domain,” said Low. “The issue is that Sound Transit is not offering market value and refuses to budge.”
Low said that in July 2017, Sound Transit offered $460,000 for the property based on an appraised value of the property at the same amount. Low soon sought out a separate appraisal which valued the property at $598,600. Low said that Sound Transit’s appraiser never gained entry into the property and only did a street appraisal.
Low said that due to the price difference of the two appraised values, his family rejected Sound Transit’s offer.
“We gave them the estimate by our appraiser, and [it seems like] they totally didn’t look at it.”
When Sound Transit sent them an updated final offer (in November 2017), Low said it was for the same amount: $460,000.
Low would continue to get two more appraisals, to no avail. Sound Transit, he said, held its ground. Low pointed out that currently, the property is valued at $689,771 on Zillow.
Last month, Low said Sound Transit exercised eminent domain condemnation of the property.
Low said Sound Transit still valued the property at $460,000. Low was in disbelief. He said that no single-family 3-bedroom homes are currently priced that low in Northgate.
“This really puts us in a bind, you know?” said Low. “No lawyer charges ‘just a little.’ But we have been forced to do something because they served us papers.”
“I told my sister-in-law, we really can’t fight a 500-pound gorilla here,” said Low. “If they accept that [$537,000] offer, she should let it go.” $537,000 is their latest counter, based on an appraisal they got in March 2018.
Po and Amy Lee, at Sound Transit’s open house at the Lynnwood Convention Center on July 25. (Photo by Stacy Nguyen)
The Lees
The Lees said they have experienced something similar. They said Sound Transit initially offered them $2.1 million for their building. The Lees believed the number to be too low so they decided to get an appraisal of their own. They said Sound Transit offered to reimburse them for up to $12,500 in appraisal fees though they said they spent more than that amount.
The Lees’ appraisal came in at $2.38 million, and they said they have not been reimbursed for their fees.
The Lees said that while the two sides were negotiating a purchase price for the property, Sound Transit representatives contacted the Lees’ five retail tenants — Computer Sonics, Jackson Hewitt, 98 Cents, Supercuts, and Max Cleaners — and initiated the relocation of the tenants to other locations. Three left in spring 2017. The other two vacated in spring 2018. The Lees said that they have not been compensated for the $10,976.39 per month in loss of rent by Sound Transit.
“Why did they go in to provoke the tenant into leaving but then not buy our property?” Po Lee asked rhetorically.
Further, the Lees claim that because the property has been vacant, the Lees said that their insurance company has given them notice that it is cancelling their policy. The Lees are concerned that if their property is not insured, they are at significant risk of loss and liability.
“Now we have to use our own money to fence the property because it is vacant,” said Po Lee.
He said he doesn’t believe that Sound Transit cares about property owners like them. He said he has had significant trouble reaching Sound Transit over the years. “We cannot deal with these people,” said Po. “We recently went to Sound Transit’s Shoreline open house [in June] and talked to their representative there. They tell me they will respond to me and follow up with me — and they don’t. I call, they don’t respond. I email, they don’t respond. They are not responsive.”
Sound Transit
Reason said that Sound Transit actually recommends that property owners going through the acquisition process also obtain an appraisal by an appraiser of his or her choice. “As an incentive, and to encourage collaborative negotiations, Sound Transit offers the owner reimbursement of up to $5,000 for the cost of such an appraisal.”
“Ideally, we have written communications, verbal communications with property owners — and when we start the process of negotiating the process of property acquisition, we sit down with the owner over however many meetings it takes to negotiate fair market value,” said Reason. “The thing is, we cannot pay over fair market value. We’re a public agency, and we’re required by law to pay the individual what his or her property is valued at the market.”
Reason said that when this process works well, Sound Transit offers fair market value and a property owner says he or she will take it. Reason said there are people who are very happy with what they are offered.
There are also cases in the middle. “These cases are where people say, ‘I don’t want to leave my home’ or, ‘I think I can get more money for this.’ And sometimes they decide to come back to Sound Transit to work it out after doing some research.”
Reason said a minority of cases — she estimates about 4 or 6 percent of acquisition conversations — end up in court. “Those that wind up in court — the vast majority end up being settled without going through a full legal process,” said Reason. “It ends up being cheaper and less time-consuming for the property owner.”
An impasse
In an email to Po Lee, his lawyer, David Steele from Perkins Coie, said that his goal is to help them resolve this acquisition process through settlement soon and avoid trial. The latest update on their property from earlier this month is that Sound Transit is seeking soil and other testing on the Lees’ property before it can submit an offer to the Lees.
“What Sound Transit has told us is that after they have completed their environment review, they would be re-appraising the property or at least be making a new offer for the property,” Steele stated in the email. “Presumably, negotiations would resume at that time.”
“Sound Transit initiated the condemnation action [on the Lee’s property] in order to gain access to the property for purposes of evaluating the environmental impacts on the property’s value, based on its historical use as a gas station and dry cleaners,” Reason explained.
“Preliminary environmental assessment indicates a need for additional testing to refine our understanding of these impacts.”
Po Lee said he feels like he is being made to jump through hoops. “We don’t understand why Sound Transit is doing this — it’s been almost three years. We, as [private] citizens, do not always know who to turn to for such unfair practices.”
“[Sound Transit] is so big that it’s not responsive to other people’s needs or to reasonable process,” said Low. “I recognize they have a legal process and they are abiding by the legal process. They haven’t done anything wrong in that sense. But in order to fight their legal process, it will cost the other parties great expense and grief. … My sister-in-law is linguistically challenged. She cannot speak English well. She is distressed [by this process].”
“The thing is we’re from China,” said Amy Lee. “We left China — and in China, we expect people to do this type of thing to us. But not here in the U.S.”
Low has the same sentiment. “This is worse than in China, snatching your property from you. And this should not happen in America. … I know they have legal process, but it is like bullying.”
Reason said that the majority of Sound Transit property acquisitions have been completed without the need to proceed to trial, at an amount agreed upon by the property owner and the agency. However, she also said that she understands that emotions become heightened during this process. “These kinds of transactions are very stressful, even if you end up being happy with what you are offered,” she said. “I know it can be really, really difficult, emotionally.”
Stacy Nguyen can be reached at stacy@nwasianweekly.com.