4th Avenue Theatre owner seeks permit to tear it down

The Anchorage Assembly was asked by Mayor Ethan Berkowitz on Tuesday to adopt an emergency moratorium on demolishing historic buildings after the developers who own the 4th Avenue Theatre downtown applied for a permit to tear it down.

The demolition application for the theater occurred nearly the same time that a contractor for the same developer group obtained a demolition permit for the blighted Northern Lights Inn in Midtown. The downtown and Midtown vacant buildings are owned by the same family of developers represented locally by Derrick Chang of Emerald Investments LLC.

But while the mayor and other city officials seek to preserve the theater as a historical treasure, they've described the boarded-up inn as an eyesore in Midtown. Last week, it became public that the city had executed a search warrant to inspect the property in September.

The theater has been listed on the National Register of Historic Places since at least 1982, according to the emergency ordinance sought by Berkowitz.

Tuesday's emergency ordinance declared a 60-day moratorium on the demolition of properties on the federal register. After a discussion, the Assembly voted 9-2 to pass the measure, with Assembly members Dick Traini and Amy Demboski opposing.

Assembly chair Elvi Gray-Jackson said she planned further meetings on the issue.

Before the vote, city attorney Bill Falsey said the city contacted the owners of the property Tuesday and was told there were actually no imminent plans to tear down the 4th Avenue Theatre.

Falsey said Emerald Investments had sought the demolition permit in an "honest but mistaken belief" that it was required to avoid an enforcement action from the city related to the downtown theater.

The only enforcement action that has been taken is against the Northern Lights Inn, Falsey said.

"We have not received complaints of individuals breaking into the theatre," Falsey wrote in an email. "The two situations are very different."

Falsey said the emergency order marks the speeding-up of a process that was already underway to create more public involvement before a historic building can be destroyed. Falsey said city attorneys were already working on a measure aimed at requiring demolition delays or special zoning districts for historic buildings, which he said have been adopted in other cities.

In August, the city's Historic Preservation Commission passed a resolution supporting the 60-day moratorium until such an ordinance had been adopted.

Falsey said there's concern that, if a developer who owns a historic property applies for a demolition permit, there is "no public notice, no discussion, no process for alternatives to be developed or posted."

In documents submitted to the Assembly on Tuesday, Berkowitz wrote that the goal of the emergency order was to allow the Assembly to decide whether a "demolition review" should be adopted for historic buildings. Any building listed on the National Register of Historic Places would qualify, such as the 4th Avenue Theatre, which has been the subject of intense community debates over the years.

While the demolition permit for the 4th Avenue Theatre was sought on Monday, it was not awarded. City development director Chris Schutte said both the city and the developer are researching whether something in the deed or some other rule would prevent the historic theater from being demolished.

Schutte said a legal requirement may exist to preserve the facade.

It's the first time a demolition permit application has ever been filed for either the Northern Lights Inn or the 4th Avenue Theatre, according to Schutte.

The plans of the hotel owners, Emerald Investments — one of a number of investment companies owned by Joseph and Maria Fang — remained unclear Tuesday. Messages to Chang and Russell Winner, a lawyer for the family, were not returned Tuesday.

In a phone call Monday evening, Chang said he couldn't comment on what had happened at the city's permit office.

"I need to work through all these issues with the city," Chang said.

A Friday meeting between Schutte, Mayor Ethan Berkowitz and members of the Fang-Chang family was intended to be an effort to "reset the relationship" with the city, Schutte said.

After Tuesday's Assembly meeting, Berkowitz said communication with the developers has "not been as clear as it could have been."

Berkowitz said he was trying to preserve public process around the 4th Avenue Theatre with the emergency order, though Assemblywoman Demboski, a conservative from Eagle River, criticized the administration's action as a "public extortion" dropped on the Assembly at the last moment.

Berkowitz said he hoped the developers would follow through with razing the Northern Lights Inn.

On Monday, the developer's contractor, Alaska Demolition LLC, obtained the demolition permit for the hotel. It expires in April 2017, the document shows.

The inn has been vacant since 2002. In late September, city investigators executed a search warrant at the property to investigate complaints about squatters and code violations.

The city is now ordering the property owners to fix the barricades and repair the water, heat and fire alarm systems. They also say failure to secure and clean up the building's exterior could lead to big fines under a new city law that targets empty buildings. Winner, the lawyer for the developers, has challenged the city on many of the demands.

Schutte, the city development director, said Tuesday it's "highly unusual" for a developer to apply for a demolition permit at the start of plans for a demolition, rather than at the end.

He also said the permit could be one of many needed to raze the hotel.