A shopping center that Gig Harbor residents were promised more than a decade ago still sits undeveloped at Borgen Boulevard and Harbor Hill Drive, and now city leaders are considering a tax break that could turn the 18.5-acre parcel into apartments instead of storefronts. The Gig Harbor City Council is set to vote on a proposed 12-year Multi-Family Tax Exemption ordinance during a second reading on September 28, following a first reading scheduled for September 14.
The property, known as Village at Harbor Hill, was originally envisioned as a business park with a grocery store, banks, restaurants, shops and medical services, according to the Tacoma News Tribune. Development talks for the site date back at least a decade, and the plans have stalled for years, in part due to a failed anchor grocer deal. As reported by Gig Harbor Now, Town & Country Markets agreed in 2015 to anchor the commercial center, but the project fell through when construction costs escalated rapidly.
That grocer setback had ripple effects. Roughly 28% to 29% of small retailers that had pre-leased space in the proposed development canceled their commitments during the prolonged delay, even though at its peak 80% of non-anchor space had been pre-leased, per the same outlet’s reporting. City officials pushed to salvage the retail vision as recently as a June 2024 public meeting, when they disclosed preparing updated local income and demographic data to present to Trader Joe’s in an attempt to recruit the grocer to the site.
A Decade of Stalled Plans Meets a New Housing Push
Now the site’s owner, Raydient Places + Properties — a subsidiary of Florida-based timberland company Rayonier — is considering adding multifamily housing to the property instead. Jon Rose, Raydient’s vice president of real estate, told the news outlet that the Village project is nearing a point where the company may share more news, and described the proposed tax exemption as a balancing act for the city. Rose said he lacked enough information about the proposed MFTE program to fully assess its effect on Village at Harbor Hill, and added it was uncertain whether a developer would embrace the exemption at a 70% income threshold…