Project ID, a nonprofit organization that provides programs for adults with intellectual and developmental disabilities, is searching for a new home after recently learning that their landlord wants to nearly double their rent.

Under their current five-year lease, which ends on Jan. 31, Project ID pays $3,331 a month, which includes property taxes, insurance and things like snow removal.

Executive Director Bob Hutchinson said his board offered to pay $4,000 a month for the first year of a new five-year lease, with the amount going up $100 per month each year after that. The board also offered to take over snow removal and parking lot maintenance.

“I was trying to reduce costs,” Hutchinson said. “I offered a 20% increase, which I thought was a fair increase.”

Landlord Jessey Nagra of AJR LLC countered with an amount of $65,000 the first year, not including insurance or property tax, with the amount increasing by about $13,000 a year after that. “I can’t afford that,” Hutchinson said. “There’s just no way we can.”

Hutchinson said he doesn’t even know how much extra the property tax and insurance would be on top of the sharply increased rent. “That could easily be $90,000,” he said of the total annual cost. “In many ways, it’s like tripling our rent.”

In a letter, Nagra said he believes that Project ID’s offer amounts to less than half the fair market rental value for the building.

“The above is a reasonable proposal, given that we are a for-profit business and still proposing to receive below fair market value for the first three or five years and incrementally reaching the lowest fair market value by year four,” he wrote.

Nagra said he thinks the incremental increases to reach fair market rent are fair, and that his company is not a nonprofit.

“Obviously, we have to make money,” he said. “We can’t lose money.”

The building at 4209 E. Pacific Ave. had been a movie theater that was then used as a church. It sat vacant for several years before Project ID moved in.

The nonprofit was started as a way to offer social, recreation and work opportunities for adults with disabilities.

“The idea was to create a safe place where people can gather,” Hutchinson said.

Project ID has social activities at night and a day program. Participants compete in Special Olympics, as well as create their own sports teams. There are 50 people signed up to play basketball, but volunteer coaches are needed. Project ID lost about 80% of its volunteers during COVID and has not yet replaced them, Hutchinson said.

“We’re really on a shoestring, as far as volunteers,” he said.

Alice Johnson has been coming to Project ID five days a week since discovering it last month. She recently moved to Spokane from Houston.

“I was looking for a place with other disabled people,” she said.

Johnson, 21, has autism and expresses herself through art. She likes to be social, but has difficulties with large groups.

“Too much people and too much noise is hard for me,” she said.

She said she feels welcomed and accepted at Project ID.

“I get to experience things with people who understand,” she said. “I get to be with people who I feel comfortable with and I feel won’t judge me. I think that sometimes people don’t understand autism and see me as the crazy girl.”

Hutchinson said many of Project ID’s participants have blossomed in their programs. One father recently told him that his daughter, who had attempted suicide three times, no longer felt isolated and alone after finding Project ID.

“I think the work we do is very important,” he said.

Trying to renew the organization’s lease has been frustrating, Hutchinson said. He began reaching out to discuss terms in May, but said multiple attempts got no response. He only got a response in early November after having an attorney send a letter to Nagra, Hutchinson said.

The late response has left Hutchinson scrambling for a solution.

“To me, it feels a little bit predatorial,” he said.

The building’s former landlord was the Hutton Settlement, Hutchinson said, which sold the building two years ago. Hutton provided security at the site, which Nagra does not, he said. This has led to vandalism and homeless people often sleeping in the building alcoves, Hutchinson said.

Hutchinson said his organization has spent quite a bit of money to improve the building over the years, but it still has issues.

“There wasn’t a light switch in this whole building,” he said. “Everything had to be turned on and off at the breakers.”

Many of the people who come to Project ID are on limited incomes. People are asked to pay $30 a month, but most of the organization’s money comes from fundraisers and grants, Hutchinson said.

“Most of our folks are on Social Security,” he said. “We scholarship a good number of our members.”

Those limited finances are why the organization can’t afford such a steep increase in rent, Hutchinson said, so he’s been looking for a new location.

The organization needs between 5,000 and 7,000 square feet of open space, he said, and any new location has to be served by STA’s paratransit program because that is how many members get around.

He’s also exploring other options, including sharing space with a church until a new location can be found.

“The worst-case scenario is, we go away,” he said.

Nagra said Project ID has been a good tenant and that he plans to reach out to the organization and offer to let them stay at the location through March 1 at the current rental rate.

“We have had offers from other folks who want to use that space,” he said.

Nationwide, overall demand in the commercial real estate sector has slowed due to rising inflation, geopolitical events and consumer spending cutbacks, according to an October 2022 commercial real estate report by the National Association of Realtors.

However, “net absorption” of leased space increased 22% to more than 23.3 million square feet in the third quarter, compared with the second quarter of 2021, according to the report. Net absorption refers to the change in leased space by tenants. Lease prices typically increase in markets with positive net absorption.

In Spokane, demand for retail commercial space is lower than other markets in the nation, according to the Realtors association.

The national vacancy rate for retail spaces was 3.6% in the third quarter. The Spokane area’s retail vacancy rate dropped slightly to 3.9% in the third quarter compared with 4% in the third quarter of 2021.

Spokane’s average retail market rent was $15 per square foot in the third quarter, while the national average retail market rent was $24 per square foot, according to the association’s statistics.

S-R reporter Amy Edelen contributed to this article.