Leavenworth City Council postpones decision on allowing condominiums in residential zones

LEAVENWORTH – After a heated debate, an ordinance to allow condominiums in residential zoning, intended to increase the amount of smaller dwelling units available for a lower purchase price, was tabled by City Council for further discussion.

“Honestly, if we need to meet and discuss this further in the coming weeks, if that means we'll ultimately get this across the finish line, I'm 100% supportive of this, but if this is just kicking the can down the road, I'm very disappointed,” said Councilmember Anne Hessburg.

The proposed ordinance would allow condominiums, or the individual sale of dwellings on a shared parcel of land, also referred to as common interest ownership, in the RL6 and RL8 zones. Currently, condominiums are allowed in multifamily and commercial zoning. 

Currently, one ADU per single-family structure is permitted under LMC 18.36.035. Under the proposed ordinance, a single-family dwelling with an ADU, or a duplex that meets building and fire separation requirements, could sell the units individually as condominiums rather than rent them, under a binding site plan. 

As it stands, the change in ordinance would not change what is allowed to be built in the single-family zone, but allow for it to be owned rather than rented. The property would be managed through an Owner’s Association and Board, which is responsible for maintaining common areas and exteriors. The board can be composed of unit owners, other people, or an agent.

Because property owners could convert existing units into condominiums, City Councilmember Zeke Reister brought up the risk of displacement to renters, and wanted to see protections in place before approving the ordinance. City staff confirmed that renters may be displaced, but the likelihood of a low-income renter getting displaced was unlikely, due to expensive retrofitting.

“Condo units are required to be built with fire separation, and for this reason, many of the existing older structures, duplexes and multifamily dwellings in the residential zoning districts are not likely to be retrofitted to meet these building and fire codes,” said Senior Planner Maggie Boles.

Council members also questioned affordability, and feared developers would take advantage of building and selling more units, attracting high-income buyers from the west side.

“Why wouldn't you come over here [from the west side], and buy this thing for 650 square feet for $400,000 if you’ve got that for a second home?” said Reister.

Councilmember Rhona Baron added that she would like to see more vegetation requirements for the condominiums moving forward. Under state law, the city may use a binding site plan to ensure the ADUs meet zoning requirements. However, it is not allowed to impose restrictions or requirements, such as vegetation, that are more restrictive than those for principal units. 

Councilmember Clint Strand was supportive of the idea, but skeptical of the unintended consequences. Strand proposed bringing in a realtor to explain the potential effects.

“How are [real estate companies] not absolutely licking their chops and revving up their patented marketing machine to go to the west side and say, ‘Retirees, guess what? You don't have to worry about shoveling snow…you have an HOA,” said Strand.

Hessburg pushed back on that idea, stating that would be the case for a large condominium development, but this situation would likely be a joint ownership of the land between a single-family home and an ADU. 

Hessburg made a case for residential condominiums creating a lower barrier of entry into the housing market through allowing ownership of smaller units.

“This is about our middle income people who don't have an opportunity to get into our market because there aren't enough tools in place for them to have that opportunity. And this creates a really great additional tool for them to access,” said Hessburg.

During the July 9 public hearing, six members of the public testified both in-person and by written comment in support of the ordinance, including Upper Valley MEND’s Executive Director Kaylin Bettinger and CSD Superintendent Tracey Edou. 

The ordinance would allow UV MEND to sell the units of a duplex project as affordable condominiums, rather than rent them. Despite the skepticism of the ordinance, nearly all council members were in support of the advantage it would lend to UV MEND.

“Many of MEND’s own renters have expressed their hopes of being able to purchase a home one day through our program. We would like to expand our housing stock to give them that opportunity,” said Bettinger.

Edou shared her observations of fewer families and staff members living within school district boundaries, and how smaller unit ownership could help establish young professionals in the community.

“One thing I think about is, if we have a young Kindergarten teacher, just starting out their professional career, where are they going to live? And the answer is Wenatchee, and that's a shame, because they're serving our community,” said Edou.

Three written comments were submitted against the adoption, which included Residents Coalition of Chelan County (RC3) and Planning Commissioner Brian Praye. While RC3 saw merit in the initiative, it requested more tenant protections, as well as language clarification to prevent out-of-scale development projects. Other opposing opinions feared density pressures on public utilities and losing the look and feel of single-family zones.

“Families want houses with yards for kids and pets and space for a garden, not condos. Investors want condos,” wrote Praye.

For condominium conversion on existing units, the building’s look, density, or function would not change, only the ownership. Once a property is converted into condominium units, it would not be able to expand or change unless permitted in city regulations. ADUs would also be required to be built in accordance with zoning requirements. 

Many City Council members stated they did not know enough to make a decision, stating they needed further discussion and more public engagement. Reister called the matter rushed. 

“At the Community Engagement I had a table to talk about this. We had the two Planning Commission meetings to talk about this. We had the special Planning Commission meeting on May 22 to talk about this. So there have been a lot of opportunities for public engagement,” said Boles.

The City Council also discussed residential condominiums over a study session on June 11. The item had been recommended by the Housing Action Plan in 2021 and placed on the Planning Commission Docket for 2024.

Although the change is up for consideration now, the city will eventually have to allow up to two additional ADUs on single-family lots, and may not prohibit the sale of the ADUs as condominiums, in accordance with state law. According to EHB 1337, all GMA-planning local governments, regardless of population size, must revise their regulations to conform with the new requirements within six months after their periodic comprehensive plan update, which will occur in June 2026 for Leavenworth. The city will have until the end of 2026 to adopt the changes.

Taylor Caldwell: 509-433-7276 or taylor@ward.media