Final Analysis: The Year in Business

Observations from Boomtown, U.S.A.
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Please disregard the Chinese calendar. Turns out that 2015 was the year of the crane. At least in Seattle.

Looks as if 2016 will be, too. And on and on until boom goes bust.

You know it will. Go bust, that is. It always does.

But for now, the business of Seattle is developing the future look of Seattle. In Ballard, that means five- and six-story apartment buildings designed in the Bow-Wow-Haus style by alumni from the Northwest School of the Architecturally Challenged. On Capitol Hill, it means feigning historic preservation by saving the façade of a sweet old building and gluing it to the front of a new hipster-plex. And, in downtown Seattle, it means trying to keep from being subsumed in a high-rising flood of Amazonian proportions.

This glut of development offers the clearest example that lenders are eager to part with lots of cash to help Seattle fulfill its mission of cramming thousands more people into the geographical equivalent of a walk-in closet, then taking away their car keys and parking spaces and telling them to devise a new way to get to work.

Some of those lenders are from other countries, notably China. These well-heeled foreign nationals pony up big bucks under the federal EB-5 program to gain access to a green card. It’s all above board, don’t you know. Except when it isn’t. The Securities and Exchange Commission says local developer Lobsang Dargey, a former Tibetan monk, diverted tens of millions of dollars of EB-5 money to other personal “projects,” including building a house in Bellevue and gambling some of it away in casinos.

Meanwhile, one of Dargey’s EB-5 projects, the 41-story Potala Tower in Belltown, is an enormous hole in the ground that will likely gape for a long time, not unlike the Seahawks’ secondary after a fourth-quarter collapse.

Seattle, of course, knows from holes in the ground. I suggested last year that the tunnel not being dug by Bertha would be a good place to park the Jeff Bezos Collection of Amazon Drones, but the Potala Pit is only two blocks from Amazon’s new downtown campus. It’s almost as if it was meant to be. Thank you, Mr. Dargey!

More business-related questions to ponder as the Year of the Crane comes to a close: 

As Tableau Software quietly becomes the dominant economic force in Fremont, what are its ultimate goals? Better seats for the Solstice Parade? Easier access to Fremont Brewing? Neighborhood discounts at Brooks Running?

Going forward, what should we make of the fact that Apple’s new iPad Pro is a fairly obvious copy of Microsoft’s Surface Pro, and that Windows 10 appears to be Microsoft’s best operating system since cave drawings? Is the new Microsoft of Satya Nadella and Brad Smith really a force for Apple to reckon with? Or will they also decamp Redmond for the NBA?

Will Seattle embrace its own broadband internet system and loosen the grip of Comcast, CenturyLink and others who would happily bundle our communication needs into one neat package deal that we can’t extricate ourselves from until the Mariners win the World Series?

When Weyerhaeuser moves its corporate headquarters to Pioneer Square, will the CEO plant a tree in the lobby for old times’ sake?

When Boeing starts making a profit on its 787 Dreamliner, will airlines stop charging us for legroom?

If Alaska Airlines and Delta Air Lines ever meet for a peace lunch, will that lunch taste like pretzels or peanuts?

The answers may become more obvious in 2016, although it’s hard to see anything clearly with all those cranes in the way. 

JOHN LEVESQUE is the managing editor of Seattle Business magazine. This column also appears in the December issue of Seattle magazine.

Final Analysis: The Sporting Life in 2017

Final Analysis: The Sporting Life in 2017

Three predictions for the coming year on a new arena, an old arena and the Mariners.
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As every first-year business student knows, a city’s economy is not considered “world class” until said city has erected at least four shrines to professional sports and these shrines remain empty and unused most days of the year. Seattle is knocking on the door of world classiness because it already has KeyArena, Safeco Field and CenturyLink Field up and running. Occasionally. Just one more monument to appease the great mass of athletic supporters and we’re there. Hallelujah!
 
It’s only a matter of time because Chris Hansen, the San Francisco rich guy who wants to build a new arena on First Avenue South and bring pro basketball and pro hockey to Seattle, is this close to getting his way. In October, Hansen revealed that he and his investors are now willing to pay the whole honkin’ bill for plopping a new arena into the SoDo neighborhood a block from Safeco Field. He still wants a piece of Occidental Way vacated and also expects some tax breaks from the city, but that’s how rich guys are. (See: Trump, Donald.) Besides, the people who believe we’re not world class until the NBA returns to Seattle are salivating over this deal because it’s the best deal we’re ever going to get
 
Of course, these same people said Hansen’s previous offer, which would have required that $200 million in public money be plowed into a new arena, was also the best deal we were ever going to get. 
 
Hansen’s decision to pay more for his arena places the sports economy clearly in the local spotlight this year. Heaven knows we could use more opportunities to pay $9 for a beer and see millionaire athletes selling Jaguars and BMWs on TV. It’s the kind of economic shot in the arm that only comes around whenever a sports league is in a coercive mood. 
 
And so, in the spirit of this January issue’s “looking ahead” theme, we offer three predictions relating to the regional economy as the Hansen arena intrigue continues to unfold.
 
Prediction 1: Hansen, who has already spent more than $120 million buying up property in the area of his proposed arena, will persuade the Port of Seattle, his arch nemesis in this melodrama, to fold up its tent and send all cargo-handling operations to Tacoma. That decision will pave the way for so many trendy bars and restaurants with names like Kale & Kumquat or Cobblestone & Wingtip that Hansen will be persuaded to create a private streetcar system to connect Pioneer Square with the burgeoning Stadium District. 
 
Prediction 2: The city-owned KeyArena, whose very future is clouded by the Hansen proposal, will announce plans to house up to 10,000 homeless persons every day. Even on days when the Seattle Storm and Seattle University basketball teams need the building, the city believes the Storm and the Redhawks could use the attendance boost, so it becomes a classic win-win.
 
Prediction 3: The Seattle Mariners, who still don’t like the arena proposal, will channel their hostility onto the field of play — and still not win the World Series. (This is called pattern-recognition analysis.) However, always mindful of improving the fan experience — because it’s not whether your team wins or loses, but whether you’re inclined not to press charges for being gouged by a vendor — the Mariners will introduce several new fan-friendly food items, plus mani/pedi stations in the pricey seats and roving loan officers to assist anyone trying to finance the purchase of hot dogs and sodas for a family of four. 
 
JOHN LEVESQUE is the managing editor of Seattle Business magazine. Reach him at john.levesque@tigeroak.com.