The QFC on 24th Avenue Northwest closed Dec. 3 for what is expected to be about two years and demolition of the building is set to begin this month to make way for an eight-story mixed-use apartment building, Ballard on the Park.

The project was originally scheduled to break ground this past March, but the developers, Seattle-based Security Properties Inc., couldn't reach an agreement with investors ING, said Jeanne Muir, a spokesperson for the developer.

In the wake of uncertainty in the housing investment market, with millions of subprime mortgages falling into foreclosure, many investors have reevaluated their willingness to back residential developments. But Muir couldn't say why an agreement was never reached.

"I have no idea why they didn't sign on the dotted line, they just didn't," she said. "This is a good project that has been worked on behind the scenes the entire time."

Instead, the project will go forward with a partnership between PNC Realty Investors Inc. and Security Properties. Muir said the joint venture required securing union contractors to do the job, which led to further delay.

Also, the land is privately owned by the Dunn Family Foundation and leased to Security Properties long-term. Working through land lease agreements also took more time than anticipated, said Muir.

Bumgardener Architects designed the eight-story structure. The lead architect, Mark Simpson, is a 25-year Ballard resident.

The existing grocery store will be replaced at the ground floor level and be 45,000 square feet, twice its current size. The goal is to get QFC open again by the fall of 2009, said Muir.

"Everyone is going to work toward the store being open as soon as they can," she said.

The store's 60 employees were offered positions in neighboring QFC branches.

Six stories of apartments will be built above the store, 268 units in all; 69 studios (600 square feet), 139 one-bedrooms (750 square feet) and 60 two-bedroom units (1,100 square feet).

There will be 15 two-story, brick-clad town homes for rent; seven facing east along Ballard Commons Park and eight looking north on Northwest 58th Street. The apartments will be rented at market rate, said Muir.

According to the Seattle Office of Housing, the citywide average market rent for all existing apartment sizes and ages is around $1,055 a month. No data was available for new apartments because so few have been built here in the past decade since condominiums have ruled the development market.

The area is zoned Neighborhood Commercial 3 with a 65 foot height limit, but this development will be more like 74 feet high because of a height bonus designated in the Ballard Municipal Center Master Plan.

The new building sits in the middle of the Ballard Municipal Center, which extends from 20th Avenue Northwest to 24th Avenue Northwest and from Northwest 56th Street to Northwest 58th Street, including abutting properties. The community came together in the late 1990s at the same time neighborhood plans were being created to plan for open space in this area and to increase the supply of housing and spur economic development.

Some of the design guidelines for buildings built in this pocket include departures from development standards to meet goals that guide attractive mixed-use developments and maximize access to the park. One departure includes an additional level in building height in exchange for providing townhouse style units at street level abutting Ballard Commons Park.

It's meant to encourage developers to avoid blank walls and create an "all eyes on the park" feel, said Muir.

"They (the community) wanted that interaction," said Muir.

The plan also proposes that town homes, with retail behind and parking below grade, are the most appropriate development to directly front the park to the west.

The seven town homes facing east will be set back 10 feet from the park and go up two stories. Landscaping will cover the roofs and set back another 20 feet before climbing up eight stories.

"There's a much diminished sense of the building (looking from the park)," said Muir.

Simpson's design is based on examples from around Ballard like the Majestic Bay Theater, the Ballard Building and older, brick apartment complexes. It's supposed to reflect simple but modern Scandinavian design.

"Buildings should reflect the character of their surroundings," said John Marasco, managing director of development for Security Properties. "Bumgardener designed a very clean, simple building in keeping with the restrained design tradition of Ballard, the new Ballard Commons Park and the library. Our goal is to have this building play a vital role in the daily happenings of the Ballard neighborhood..."

The apartments will be lined in muted grey brick. The building splits into a U-shape at the second story along 57th, providing 9,000 square feet of open space for residents.

A public outdoor terrace is planned for the southwest corner of the new QFC. Inspired by Scandinavian woodwork and designed by Fremont artist Rodman Miller, a wing like, asymmetric exposed wood and glass canopy will hang over the terrace and seating area.

"It softens the border between private and public and makes it more welcoming," said Muir.

A large blown glass bowl will collect rainwater and deposited into a manmade creek that runs the length of the terrace.

A 16-foot change in elevation from the southwest to the northeast corner essentially creates two ground floor levels. QFC will be buried on the north and east sides of the property. Parking for about 450 vehicles will be located on two underground levels

The main pedestrian entry to the grocery store will be located on the northwest corner. Residential vehicles will enter on the southeast corner.

Trash compactors and all grocery related deliveries are to be underground. A small retail outlet is planned for the southeast corner of the lot facing Ballard Commons Park and skate bowl.

Rebekah Schilperoort may be reached at 783.1244 or rebekahs@robinsonnews.com