E Pine from Bellevue to Melrose (Image: CHS)

Another half-block of Pike/Pine has been purchased by an Eastside developer with plans to create a new mixed-use development that will likely push out several long-running commercial tenants and residents of the apartments currently part of the old buildings along E Pine and Melrose.

Bookshop Spine and Crown posted about the project to its Facebook page this morning:

Yep. They sold the building out from under us. June 2013, the whole block closes. That’s Mud Bay, Edies, Le Frock, Wall of Sound, Spine and Crown, Scout, Vutique, and Bauhaus. Our spaces will be a hole in the ground thereafter.

A person with knowledge of the deal said the developer acquired the parcels at Pine and Melrose with an eye toward leveling all of the buildings and starting fresh but has had second thoughts after witnessing the backlash against the lack of preservation in this development at 10th and Union.

(Image: John Feit with permission to CHS)

Details of the sale of the six parcels owned since 2006 by an entity called M&P Partnership are not yet available via county records. It appears the developer is the Madison Development Group. You can see their mixed-use projects in the area here. On that page, Madison lists a ‘Melrose & Pine’ project including 16,240 square-feet of retail and 98,794 square-feet of residential space. In the background lurks a full slate of development incentives in place to encourage the developer to include character preservation in their Pike/Pine plans.

It appears the developer intends to put some of that incentive opportunity to work. Here’s the project description from an early filing with the Department of Planning and Development:

Construct new 7-story mixed use building apartment and commercial with 2 floors of underground parking in conjunction with identified character structures in the Pike/Pine Overlay District.

The filing lists Hewitt Architects as the firm working on the project’s design.

Our attempts to reach Madison Development representatives have not yet been successful.

CHS has learned that the sale and the project plan was announced to commercial tenants this morning and that stores in the area were told they could face closure by June 13th if the planned development goes forward. “The developers want to keep the facades, but the interiors will be gutted and an underground parking garage added, so basically, the block will be a hole in the ground for 18 months following the June closure,” one store owner told CHS.

Smaller structures will also likely be lost including 1524 Melrose, one of the last mound-mounted houses in the area.

The deal is likely to be one of the most expensive real estate transactions in Capitol Hill history. Late last month, an investor swept in with $14.9 million to buy the large BMW campus of buildings between Pike and Pine with plans to develop a mixed-use building at the site of the former auto showroom. Another sale is expected soon for the Sunset Electric auto row-era building at 11th and Pine. Meanwhile, another showroom is on the market as E Pike’s Mercedes dealership will be on the move by 2013.

Not every project includes demolishing the old buildings that come along with the Capitol Hill land. Hunters Capital this week announced it had acquired the building home to Area 51 for $3.85 million. Hunters has said its plans are to restore the building’s facade and preserve the building’s character.

Nearby, work is underway on a mixed-use development at Pine and Bellevue.

Included in the Melrose and Pine acquisition is the 1916 masonry building currently home to Mud Bay, Edie’s, Le Frock, Vutique, Scout, Wall of Sound, and Spine and Crown as well as residents of the upper floor apartments, the mound house, the 1917 Dirty Jane’s building home to Warren Knapp Gallery, the 1915 Melrose Building that houses Bauhaus, the worn Emerald City Inn apartments and a Bellevue Ave parking lot.