Satterlee House development dispute: Owner testifies


Today’s proceedings in the case of Satterlee House (Beach Drive’s “Painted Lady”) owner William Conner vs. the city Landmarks Preservation Board only ran three and a half hours in the morning, but that span included testimony from Conner himself:

First, the backstory and previous coverage: The huge front lawn of the century-old home is officially on the record as three separate lots. Conner wants to build three 3,000-square-foot-average homes on those lots. The city Landmarks Preservation Board said no – not to the idea of building on the lots, but to this specific proposal. Conner is appealing it before the city Hearing Examiner, whose ruling will be the city’s final word, challengeable only in court. Our coverage so far: Testimony from the house’s namesake David Satterlee, who sold it to Conner, here; first full day of testimony recapped here; morning of the second day here; afternoon of the second day here. And that brings us to today (this is not being heard on consecutive days because the Hearing Examiner, Sue Tanner, has to hear other cases too).

Caveat, we missed the first two hours this morning because of an unbreakable previous commitment – this wasn’t originally scheduled as a day for testimony in the case, but it’s taken much longer than first estimated (and will continue with afternoon testimony next Tuesday, and, if still needed, next Wednesday). But thanks to Char Eggleston of the Queen Anne Historical Society, who has been there every day taking copious notes, we have toplines on what we missed.

This morning’s first witness was Mark Anderson of Conner Homes, the prolific home-building company that William Conner founded, and which would build the homes on the Satterlee site.

He testified about the cost of building the homes that Conner contends are the only types that would make sense for the site – one of the key points, as the dispute is over whether the denial of approval for the project denies Conner “reasonable economic use/return” of and on his property – and his figures were vastly different from what city-hired experts suggested. He discussed high-end materials, such as cabinetry that would cost $48,000 per house, almost eight times what the city expert had suggested could work in a not-so-high-end house. His cost breakout and home pricing also assumed each lot had cost Conner $400,000, a figure that the city disputes. Under cross-examination, Anderson said he did not do analysis of that $400,000 figure, but used it because that is what Conner provided.

Conner’s testimony began with backstory about his career as founder of Conner Homes, builder of thousands of residential units — single- and multi-family — and how he came to be involved with the Satterlee property in 2000 (almost two decades after it became a city-designated landmark). He talked about the original “cottages” proposal and (according to Eggleston’s notes) suggested neighbors’ opposition was largely what brought that plan to an end.

We came in as Conner was being cross-examined by Eleanore Baxendale, one of the city’s two attorneys. He was talking about a purchase offer for the house and property – which has been on the market more than two years, as explained during yesterday’s testimony — which he thinks might still be in play, provided the future of the lawn lots is settled.

Baxendale asked him to show where in the purchase offer paperwork, which is part of the documentation in the case, there’s a written contingency saying that the offer depends on such a determination being reached. A somewhat testy exchange with Conner’s lawyer Richard Hill ensued, since city lawyers say they had asked Hill and Conner to produce all existing paperwork related to this offer and other matters, but there was Conner saying this morning that he thought the contingency was written up in some paperwork that wasn’t part of what had been presented for the case. (He promised to look it up in his office this afternoon, along with another document that came up shortly afterward, one that would lay out how much he borrowed to finance the property, which city lawyers also fumed should have been part of the documentation given to them as per their original request. Conner asked regarding the latter document, “Is it really germane to the case?” and Tanner said mildly, “That’s not up to you to determine.”)

Conner also was quizzed under cross-examination regarding the Architecture Review Committee meetings that preceded the Landmarks Board vote; previous testimony indicated that the committee had suggested Conner revise his proposal to make the homes smaller, but that the request was never honored, so the board wound up voting on a proposal which had been changed very little from the original one they had indicated would be out of scale with the site.

He acknowledged that architects had come back to him to say that the ARC had asked for a smaller home design, but “we didn’t feel smaller houses would justify the cost of the lots.” (A figure that also is in dispute.) He also repeatedly mentioned that he felt 3,000-square-foot homes were needed for a “good living experience” for families, and his contention – different from city witnesses – is that the Beach Drive neighborhood in which the house is set is one where “high-end” homes would be expected.

The city lawyer wondered why he hadn’t put the main house on the market at all in the several years between the demise of the “cottages” proposal and his initial attempt to sell it in 2006; he blamed the uncertainty of not knowing how the Landmarks Board would deal with development proposals.

After Conner, today’s final witness — who will resume his testimony on Tuesday morning — was a financial analyst hired on behalf of his appeal, George Johnson, president of Brueggeman and Johnson Yeanoplos, PC. He explained that his specialty includes “determination of economic damages in disputes” such as this.

Most of his testimony time this morning was spent on explaining his formula for analyzing what Conner believes the land and future homes are worth; he used a marker and butcher paper to spell out his calculation foundations. He said he analyzed not only the 3,000-square-foot Conner proposals, but also the 2,000-square-foot alternate proposal that city expert witnesses suggested could be financially viable on the land. His contention is that while Conner would make a 15 percent profit on the 3,000-sf homes, which he says is considered average for this type of thing, the 2,000-sf homes would make no profit at all, and would actually put the project in the red.

Johnson also offered, “I believe you have two restrictions here (on the land) — The landmark status was applied (carrying its conditions requiring approval of projects), but now there’s a second restriction, with the hearing examiner possibly ruling that ‘the zoning says you can build to a certain size, but you can’t build to that size.'” (As we reported previously, Hill has asked two separate witnesses if it is possible to tell from the terms of the landmark ordinance exactly what size of house would be allowed in a development like this, and in both cases, it has been explained, no, it’s a matter of judgment on the decisionmakers’ parts.”

After some additional numerical intricacies, testimony stopped for the morning. It will resume at 12:30 pm Tuesday, and if the case isn’t wrapped up by 5 pm Tuesday, Wednesday afternoon has also been reserved on the hearing examiner’s calendar. She said yesterday that a ruling in the case isn’t likely to come any sooner than April 11.

4 Replies to "Satterlee House development dispute: Owner testifies"

  • vp March 14, 2008 (5:38 pm)

    Strange how important paperwork just isn’t always available…

  • PSPS March 14, 2008 (6:51 pm)

    Where can I sign up to get this government guarantee that all my investments make a profit?

  • GenHillOne March 14, 2008 (6:58 pm)

    I’m still digesting the rest of this, but I’d be interested to see the city’s estimated budget for building these houses. If they really slated $6,000 for cabinetry to be put into new homes, that does sound a bit unrealistic as an argument. That’s not even mid-range and I would expect that Beach Drive home-buyers would expect high-end finishes.

  • Jiggers March 15, 2008 (9:46 am)

    The more I look at that house, the more it looks like a “pile” of…

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