Today I got a call back from Alan Justad, spokesman for the Seattle Development & Planning Department, to give some of the details behind the denied permitting of the proposed restaurant at 25th & Union.
According to Mr. Justad, the permit wasn't officially denied. What was rejected was the classification of the business as a restaurant. Instead, department planners had decided that it was a "liquor establishment" that bumped it into a different level of permitting, requiring a separate conditional-use permit that would set additional approval steps such as an additional layer of community comment and stipulations surrounding things like noise levels, maximum size, etc. The requirement for conditional-use permits applies to liquor establishments in NC1 and NC2 zoned areas, but not NC3 (24th & Union is on the eastern edge of a NC2-40 zone).
In an email response, Bottleneck owner Erin Nestor says that they take exception with the city's classification, saying that they had presented a restaurant concept with a full menu and had consulted with chefs to confirm it was feasible at that location. Their position is that the conditional-use permits should only apply to businesses that are just bars, not restaurants that include liquor on their menus.
It's not clear right now why the additional permitting steps killed the project, but one can imagine that the cost and time of a separate permitting process would be difficult for a small establishment that had a limited window to make a deal on the real estate and get an operation going.
I'm sure the regulations were designed to prevent the worst case scenarios, such as a new Deano's suddenly opening up next door to your or my house. But it seems like there should be some way to more easily accommodate applications for neighborhood businesses that have the wide-ranging community support that this one clearly had. But for now, it seems like a lost opportunity.