Horizon developer in contract to purchase Grandis Pond, affordable housing in the works

Grandis Pond, the largest east Blaine housing development that’s been decades in the making, could have a new owner.

Harbor Custom Development (HCD) announced on December 3 it signed a $14 million contract to acquire the housing development slated to bring 1,000 lots to east Harvey Road in the next 10-15 years. HCD is the Gig Harbor-based real estate company that purchased the Horizon at Semiahmoo housing development in late June for $14.3 million.

Blossom Management president Ken Hertz purchased Grandis Pond in 2005, a 438-acre property that would significantly expand Whatcom County’s desperately-needed housing inventory. The project has been delayed, among many others in east Blaine, because of the expense to bring utility infrastructure to the area.

Hertz said he decided to sell the development to HCD president and CEO Sterling Griffin because of HCD’s ability to build the homes, something Hertz said Blossom Management didn’t have the capability to do. HCD is involved in the full housing cycle, from land acquisition to sales and management. Grandis Pond would be HCD’s largest project yet, according to a company statement. The company has also developed in Texas, California and Florida.

HCD’s interest in east Blaine comes as the company is working with three builders to purchase 71 lots in the first phase of the Horizon subdivision. Griffin said they expect to break ground near the beginning of 2022.

“We started a footprint in Whatcom County and Blaine with Horizon and after that, started looking for other opportunities. Grandis Pond is a gorgeous property and provides possibility for development,” Griffin said. “It seemed like the type of project we wanted to be involved in to create housing in an area that had massive housing shortages.”

Stacie Pratschner, city of Blaine community development director, previously told The Northern Light that east Blaine housing is expected to supply nearly 40 percent of the city’s housing for the next 20 years.

Griffin said the project will remain largely as Hertz envisioned. As it’s planned now, Grandis Pond would have 387 single-family lots in its first phase that will average 6,000 square feet per lot. About 40 percent of the total project’s land will be open space and parks. 

The next steps are to complete the civil engineering for the project’s first phase, which Griffin expects to take most of 2022.

“We’re very excited to take this project forward and help Ken Hertz realize his dream,” Griffin said. “We feel fortunate to be the ones to step into his shoes and finish the project.”

The sale of Grandis Pond is expected to close between July and September of 2022 but could occur sooner, Griffin said. Until then, Hertz said he will remain fully involved in the project.

Hertz is expected to still have some hand in east Blaine housing development. Although he’s in contract to sell the majority of the Grandis Pond project, he held onto 80 single-family affordable housing units that will eventually be transferred to nonprofit housing providers.

Skip Jansen of JIJ Corporation, the developer of The Ridge at Harbor Hills, formerly known as East Maple Ridge, said he is also planning on developing as many as 100-200 affordable housing units adjacent to Grandis Pond. The affordable housing would be developed in Harbor Hills, a 144-acre property east of Harvey Road that JIJ Corporation purchased in mid-November. Although it’s still in the preliminary stages, Jansen said the affordable housing neighborhood would be mostly four-plexes and possibly include condos or apartments surrounded by lots of open space, wildlife and parks.

“We need more entry-level housing for workers because Blaine is trying to attract more business, which means more workers,” Jansen said.

To defray costs of affordable housing development, Jansen and Hertz are working with the city of Blaine and Whatcom County to potentially apply for a new affordable housing program that the county is in the process of starting.

The affordable workforce housing program is an extension of Whatcom County’s Economic Development Program (EDI), which the county has in place to administer grants and low-interest loans for construction of public infrastructure. The state legislature authorized the program in 1997 to allow rural counties to use sales tax to pay for the infrastructure with the goal of creating economic development opportunities, according to the county’s website.

Only public entities may apply, such as the city of Blaine, but the private sector can use the EDI funds to spur economic development and employment opportunities, according to the county.

Hertz said he would like the city to apply for a grant and loan combination to pay for water and sewer infrastructure as well as Harbor Hills Parkway, formerly known as Mott’s Hill Parkway, and would serve as the main entrance for both affordable housing neighborhoods.

City manager Michael Jones said there will likely be a decision by the end of January on whether or not the city would decide to submit an EDI application. The city has used EDI funds in the past to pay for the construction of the downtown boardwalk plazas as well as the Gateway regional stormwater pond, he said.

If the city decides before the sale of Grandis Pond is finalized that they don’t want to apply for the EDI funds, the affordable housing property would be returned to HCD, Hertz said.

Jansen said he’s seeing good cooperation between the county and city to promote affordable housing in east Blaine and applauded Jones for taking the helm on the issue.

“To attract new businesses, you need housing that people can afford,” he said. “I think everyone’s on the right page and heading in the right direction. We just need to keep the momentum going and work together.”