Schnitzer family member back on board of Seattle-area developer Schnitzer West

A member of Portland's prominent Schnitzer family is assuming a larger role in Schnitzer West, as the developer, one of Seattle's largest, brings a slew of local projects to market during a difficult downturn in the industry.

Ken Novack, who retired earlier this year as chairman of Schnitzer Steel Industries, said this week that he will serve as a "special adviser" to Dan Ivanoff, Schnitzer West's managing investment partner.

He characterized the move as "an important bridge to really reconnect back to the family and demonstrate the family's commitment to the business." It shouldn't be interpreted as a sign of concern or dissatisfaction with Ivanoff, he added.

Ivanoff and privately held, family-controlled Schnitzer Investment Corp. formed the Schnitzer West partnership in 1997, with Schnitzer providing most of the equity. Today the firm probably is bringing more new buildings on line in the Seattle area than any other developer.

Those projects reflect decisions made three or four years ago. Still, the timing may be unfortunate.

"They're delivering a lot of product into a very tough environment," said land-use economist Matthew Gardner, who has consulted for the partnership.

• Schnitzer West's 36-story 1918 Eighth office tower in downtown Seattle, scheduled for completion later this year, so far has no announced tenants.

• The partnership finished big condo projects in Belltown and on Capitol Hill last year. County records indicate less than one-third of the units in each has sold.

• Presales at another large condo project scheduled for completion this year in Eastlake also have been slow.

• While Microsoft, Neiman Marcus and others have gobbled up the office and retail space in Schnitzer West's mammoth Bravern project now under construction in downtown Bellevue, only about one-quarter of the luxury condos have presold.

"They're as exposed as you can possibly be," said James Stroupe, a Windermere Real Estate agent who specializes in condo sales.

But neither Novack nor Ivanoff displayed much concern in an interview earlier this week. "This is a long-term investment, and we're in for the long term," Novack said.

Despite the downturn, Schnitzer West's office and industrial properties in Seattle, Bellevue, Bothell and Puyallup are 80 percent leased, Ivanoff said. That's better than during the dot-com bust earlier in the decade, he added.

Sales at the Capitol Hill and Belltown condo projects are showing signs of life, he said, and Bravern condo sales will pick up as the project nears completion: "All things considered, we feel pretty good about where we are."

Ivanoff and Novack said they consulted almost daily when Novack was chairman and CEO of Schnitzer Investments. He left that post in 2006.

Ivanoff said he asked Novack to come back, to provide a big-picture perspective that sometimes might elude him while he's working in the trenches, and to help plot Schnitzer West's future.

The Schnitzer family is one of Oregon's wealthiest. Publicly traded Schnitzer Steel Industries recycles metal, manufactures steel and operates used-auto-parts stores.

Eric Pryne: 206-464-2231 or epryne@seattletimes.com