The Chinese real estate firm that wants to build on downtown Tacoma’s largest undeveloped tract of land plans to do the work in two phases, with the first phase completed by 2018, according to a proposal it submitted to the city.
The mixed-use project is planned for 6.4 acres between South 21st and 23rd streets near the University of Washington Tacoma. North America Asset Management Group, a Bellevue-based firm managed by Luo Xun Kun, signed a preliminary agreement with the city of Tacoma in mid-August so it could begin its feasibility study.
Luo is the CEO of Wuhan Boshengshiji Real Estate Development Co., which according to the documents, is a private company with annual revenues of about $31 million and more than 7.5 million square feet of projects in China already under its belt.
Some details of Luo’s proposal were first reported by The Seattle Times.
Luo’s firm agreed to buy the land for $3.5 million and build at least 360 residential units, 90,000 square feet of office space, 200,000 square feet of commercial space and 480 parking stalls.
Luo has until mid-December to complete the initial feasibility study. If he decides to proceed, a development agreement between his firm and the city will need approval from the City Council.
The city bought the land more than 10 years ago as the site of a new police headquarters, but those plans changed. The land has since been empty. The city put out a request for proposals two years ago and didn’t receive any responses.
Luo has hired Puyallup-based Absher Construction and Tacoma architecture firm BCRA to work on the project. The total cost of the development is $125 million, city economic development director Ricardo Noguera told the Times.
The project’s financing, according to the preliminary agreement, will require equity and investors. North America Asset Management is expected to contribute $25 million in cash equity, the documents show, and finance the rest. Luo is working to raise capital through the federal EB-5 program, which allows foreign investors who invest at least $500,000 in designated areas to receive U.S. visas.
To raise the money, Luo is working with Albert Sze. Sze manages Yareton Investments, a U.S. subsidiary of Shanghai-based Shanghai Mintong Real Estate Co. Ltd. that has proposed a hotel downtown using EB-5 capital.
The EB-5 program has come under scrutiny recently for a lack of oversight and accountability. Congress is considering changes to the program.