A project meant to bring more than 70 units of new workforce housing to downtown Juneau is dead before it could even break ground. The developer blames the city for stopping it. The city says the project was a risk to public safety.
In late 2023, the city’s planning commission approved a conditional land-use permit for the construction of a 72-unit apartment building downtown.
The six-story building was set to be located on three vacant lots on Gastineau Avenue, just uphill from the downtown library. It was meant to be workforce housing, furnished and ready to go by the summer of 2025.
But it’s been nearly two years, and the summer of 2025 has come and gone. The lots where the development was supposed to be are still empty. Steve Soenksen, the private developer behind the project, said it’s the city’s fault.
“We don’t have a stuck market. We have a stuck municipality — and they’re stuck on saying no,” he said.
The project was approved by the commission despite several safety concerns brought up by some neighbors, city officials and the fire department because of its hazardous location — an area subject to landslides — and lack of easy access for emergency services.
But while the planning commission approved that permit in a 7-1 vote, in order to get a building permit from the city’s Community Development Department, he needed to agree that the project could meet the city’s fire and life code.
Gastineau Avenue is a dead-end street, and it’s hard to turn a vehicle around there. The project’s site is also on a downhill slope toward South Franklin Street on the Mount Roberts hillside, close to where multiple landslides damaged homes and displaced residents in recent years.
“Most every section in the fire code was written because there was some kind of disaster that necessitated it,” said Capital City Fire/Rescue Chief Rich Etheridge.
He said the fire code requires at least two access points for a road that has more than 100 units. The new construction would push Gastineau over that threshold.
“Housing is needed, and we support development as much as we can,” he said. “We do have to hold the fire code. It was written for us to enforce, not for us to decide whether it’s legitimate or not.”
A potential second access point would go through privately owned land south of Gastineau Avenue. Soenksen argues that the city should help create that second access point, but he said it’s unwilling to work with him. He said the secondary access wouldn’t just benefit his project, but the entire street, which is prone to hazards.
“A big part of our housing crisis is that the city’s been making unrealistic requirements on housing projects for 40 years that I can count,” he said.
Jill Lawhorne, the director of the Community Development Department, said Soenksen was aware of the code requirements throughout the process, and he was the one unwilling to accept the requirements that came with developing at that location.
“Not all land is appropriate for housing if it can’t be made safe,” she said. “I think egress is that bare minimum of safety that we would want to see for housing and for our residents.”
She also pushed back against his allegations that the city is to blame.
“It’s not our community development’s responsibility to make a project happen,” she said. “We can help you through the process. We can help you obtain the permits if you meet the requirements of code, but it’s on the developer to bring their development to fruition.”
The project’s planning commission permit has since expired, and Soenksen said he has no intention to keep trying to make the project happen.
“I had plans for over 220 apartments to go in downtown,” he said. “But once they killed this one, I have no resources to try and do anything else, nor desire, because of the treatment I got with the city.”
Despite that, he’s on the hook to repay a quarter of a million dollars from a predevelopment loan he received from the city’s affordable housing fund in 2022.