June 26--The former Seattle branch of the Federal Reserve Bank of San Francisco could be up for grabs if Seattle Public Schools doesn't land it for a new elementary school.
The school district has until July 3 to file an application with the U.S. Department of Education showing how it would create a school -- its first downtown -- in the six-story building at 1015 Second Ave.
"There are certainly enough students that would fill up that building within a mile and a half radius," said Flip Herndon, assistant district superintendent for facilities. "I'm pretty sure it can be turned into a school. The question is at what price can that happen?"
If the application is rejected, the building will be sold through an online auction open to any buyer, including foreign investors.
An auction would draw strong interest from many buyers, including Seattle-based architecture firm NBBJ, said Dan Dahl, senior vice president at Colliers International. He does not represent NBBJ.
"They can call it the NBBJ building. That's much better than being in some big 1 million square-foot office building where you get lost," he said.
NBBJ's 80,000 square-foot lease at South Lake Union's Alley24 expires in early 2016, Dahl said, and the firm is known to be considering sites in the central business district and Pioneer Square.
NBBJ didn't respond to requests for comment on Wednesday.
The firm also has a historical tie to the 86,800-square-foot building: It is one of the earliest surviving works of the partnership, which was founded in 1943.
William Bain Sr., one of NBBJ's four founding partners, was the lead architect for the design, according to a report by Tacoma-based Artifacts Consulting.
"That was the boom years for NBBJ coming out of the war," said Michael Sullivan, a principal in Artifacts. "They were really growing into the firm they would eventually become."
Bain may have won the commission because he designed the home of Clarence Shaw, manager of the Seattle branch of the San Francisco Fed in the late 1940s, according to Artifacts' report.
Today, that part of downtown is becoming a cluster of the region's biggest architecture firms. ZGF Architects is two blocks away at 925 Fourth Ave. SRG Partnership is at 110 Union St. And Bellevue-based MulvannyG2 Architecture is moving to 1101 Second Ave. next year.
Built in 1950 for the Federal Reserve Bank, the fortresslike building cemented Seattle's status as a major financial center in the post-World War II era. The building features a giant vault and corridors of steel reinforced concrete.
Those were necessary because the building held lots of cash and currency, more than anywhere else in the Pacific Northwest: In 1950, the branch sorted $243 million in paper currency -- nearly $2.4 billion in today's dollars.
"To the modern eye, the building is kind of boring and unremarkable," Sullivan said. "If you were building a fortress of commerce, that's exactly what you would build it to look like."
The fortress has been vacant since 2008, when the bank moved to Renton.
In 2010, a federal judge blocked the Federal Reserve from selling the old building to an undisclosed buyer, saying the bank hadn't followed procedural requirements of federal historic-preservation laws. The judge's order came in a lawsuit filed by a group that feared a skyscraper would be built on the site.
"There are very few buildings in the state that are as emblematic of that atomic age as that building," Sullivan said.
The Federal Reserve Bank deeded the site in 2012 to the General Services Administration, which manages federal property. The GSA concluded it was not cost-effective to keep the building, which needed $30 million to $40 million in upgrades to make the space usable to modern office tenants.
Under a complex process, the GSA first gave federal agencies a chance at the property -- there were no takers -- then groups serving the homeless.
Compass Housing Alliance applied to the federal Health and Human Services Department to take over the property, said Stephanie Kenitzer, a GSA spokeswoman. The department rejected Compass' application June 3, clearing the way for a joint application by Seattle Public Schools and the city of Seattle to turn the property into a school.
For its part, the school district is trying to determine if it can afford to retrofit the building. In February 2013, the building was placed on the National Register of Historic Places.
"The roof of that building is landmarked, so you can't go up [higher]," said Herndon, the assistant district superintendent.
The school district's elementary buildings typically cost $25 million to $40million to construct, depending on their size and configuration, he said. The district has only $5 million earmarked now for the project, which can be used for planning.
To come up with retrofit funds, the district could seek money from the Legislature, add the project to a future local levy and raise private donations, Herndon said.
The Downtown Seattle Association (DSA), a nonprofit membership group of businesses, has lobbied for years for a school. There are nearly 60,000 downtown residents, and the fastest-growing age group is children between 5 and 9, according to the DSA.
The former Federal Reserve building is "a tremendous opportunity" to give downtown families a neighborhood school, said Jon Scholes, the DSA's vice president of advocacy and economic development.
A K-5 school there could offer students access to resources nearby, including the Seattle Central Library, Seattle Aquarium, Seattle Art Museum and Soundbridge at Benaroya Hall, Scholes said.
By 2016, the downtown population of children in kindergarten through eighth grade will top 500 students, according to the DSA.
The General Services Administration has not assessed the property's market value.
"Our goal would be to get the most value from the sale for the taxpayers," said the GSA's Kenitzer. "That money will go back into the Treasury."
Sanjay Bhatt: 206-464-3103 or firstname.lastname@example.org On Twitter @sbhatt
(c)2014 The Seattle Times
Visit The Seattle Times at www.seattletimes.com
Distributed by MCT Information Services
DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer