KPFD Calahan Property Sale Collapses

A proposed $1.05 million sale of the Key Peninsula Fire District’s Calahan property in Key Center collapsed after the buyer failed to deposit the required earnest money last December, a lapse the district fire commission said it did not learn about until March.

Fire commissioners voted unanimously at a March 10 meeting to terminate the purchase and sale agreement with Taechang LLC of Gig Harbor. Owner John Park proposed building a gas station and convenience store on the site.

Commissioner Shawn Jensen said the district had been told by its real estate broker, Keller Williams Commercial, that there were difficulties contacting Park as early as December. However, Jensen said the district wasn’t informed until March 2 that Park had not deposited the required earnest money — $10,000 — with the title company.

The original 90-day feasibility period ended Dec. 3, making Park’s earnest money deposit due on Dec. 8. A week later, the district and Park signed an amendment extending the feasibility period by another 90 days while KPFD addressed a failing septic system. That amendment required the same $10,000 deposit from Park by Dec. 29, but it remained unpaid. Park also didn’t provide a required financing waiver due in January.

Park did not respond to requests for comment from KP News.

The termination leaves the fire district to determine what happens next with the property, located at the corner of Key Peninsula Highway and 92nd Street NW, one of the most visible parcels in Key Center.

The collapsed deal is welcome news for some residents. At least two offers are under consideration, including a December proposal from daycare operator Alyssa Johnstone for $750,000 — roughly $250,000 less than Park’s original offer.

There is also renewed interest from another gas station developer, along with a local community working group that has been exploring alternative uses for the site.

The Key Center Commons Working Group has spent months speaking with potential partners — including local and national organizations and foundations — about possible community-oriented development.

Group organizer Lysanna Anderson said those discussions were difficult to advance while the property remained under contract.

“Our main goal is to try to secure the property so that we have a chance to talk to the community about what they’d like to see there,” Anderson said. “Now that the property is available again, community members are excited about talking with us about what they’d like to see.”

At the March 24 board meeting, Commissioner Stan Moffet proposed delaying negotiations until an April 28 meeting to give the community group time to assemble a formal offer. The suggestion drew criticism from Johnstone, who said delaying negotiations with her offer already on the table “feels biased and blurs the line of unethical business practices.”

Commissioners also discussed whether to continue working with Keller Williams Commercial following communication breakdowns tied to the failed deal, with all but Commissioner Colleen Mullen indicating a willingness to stay with the firm but work with a more senior broker.

One factor: even if the district switches brokers, it could still owe a commission if the property sells within six months.

“I’m willing to overlook past issues if they can finish this off,” Commissioner John Pat Kelly said.

Mullen didn’t agree. “I don’t see us sticking with somebody that already basically messed everything up,” she said. “We’ve already been dinged once, and we could get dinged again.”

Commissioners said the district is still waiting on a permit from the Tacoma-Pierce County Health Department to complete repairs required by the county on the failing septic system. Much of it — including replacing septic pumps — is done, but the tank still needs to be relined for $25,000.

That remaining step has become a point of debate.

Some commissioners warned that delaying the repair could create bigger problems, including the risk of the project lapsing into a full system replacement with stricter requirements or triggering enforcement actions such as a lien.

Kelly’s opinion was direct: “Fixing it is part of the cost of getting rid of the property.”

Others urged caution, saying they want clearer information on the cost difference between completing the repair now versus waiting.

The board is expected to revisit the issue at its April 14 board meeting.