Kirkland has approved one more townhome project in a district where it has now banned new townhomes, on one block of NE 85th Street. In September 2026, Taylor Morrison paid $27 million for Rose Hill Village, a vacant 3.42-acre shopping center at 12631 NE 85th St., according to Connect CRE, which cited the Puget Sound Business Journal. The builder calls the project Rose 85. Its marketing page lists townhomes from $1 million, 1,357 to 2,689 square feet, three to four bedrooms, and completion in late 2027. Four months before the sale, the Kirkland City Council voted to stop this kind of housing from being built across most of the district around it.
That makes Rose 85 an exception the city wrote on purpose. It is going ahead in a buyer's market, while the rule behind it points toward fewer new townhomes in the station area.
The deadline sits in the ordinance
For Rose 85, the key date is a permit filing deadline. On May 5, 2026, the council adopted Ordinance O-4936. The city's NE 85th Street Station Area Plan page says it took effect on May 16, 2026. The ordinance lists detached and attached dwelling units as prohibited primary uses in three station-area zones:
- Neighborhood Mixed Use
- Urban Flex
- Civic Mixed Use
The exemption for attached dwelling units is narrow. A project keeps its townhome rights only if both of these are true:
- It already had final Design Review Board approval.
- A complete building permit application, consistent with that approval, is filed within nine months of the ordinance taking effect.
Nine months from May 16 puts the deadline in mid-February 2027. Rose 85 qualifies because its earlier owner, MainStreet Property Group, won design review approval for 89 townhomes on the site in 2025. Cherish Kirkland, a local civic site that labels this item as news rather than opinion, reports that city staff told the council on May 5 that the exemption was meant for the Rose Hill development. The same site reports that the city issued a demolition permit the day before the sale was recorded on September 15. It also reads the "consistent with" requirement as meaning a substantially redesigned project would fall under the ban.
For a future buyer, that creates a split worth keeping in mind. Taylor Morrison told the Puget Sound Business Journal that home counts and prices were still being refined, but the ordinance ties the project's legal footing to the plan that was already approved. 89 townhomes is the approved figure. The final count is not yet confirmed.
Why the council chose to stop building townhomes there
The station area is the district Kirkland has planned around the Sound Transit Stride bus rapid transit station at I-405 and NE 85th Street. The city describes it as an area for walkable, mixed-use growth tied to transit. The Rose Hill site has gone through two failed plans for that kind of growth. MainStreet bought it in early 2022 for $20.5 million and planned the Kirkland Technology Center, a two-building, 575,000-square-foot office complex. The firm dropped the plan as office demand fell. The site had been mostly vacant since a 2018 fire damaged or destroyed seven businesses.
The council's reasoning was about land capacity. According to Cherish Kirkland's account of the debate, earlier planning talks about this property considered apartments of up to 600 units. Councilmember Jay Arnold described the shift to 89 townhomes as 511 homes "that will need to be placed elsewhere in our city." The same account reports a 7-0 final vote and a 5-2 amendment that kept townhomes legal on roughly nine edge parcels next to single-family streets, about 3.7% of the station area. The city's ordinance confirms a carve-out for certain lower-height parcels east of 124th Avenue NE. The parcel count and percentage come only from the Cherish Kirkland report.
Cherish Kirkland also reports that a 2030 sunset on the ban failed 0-7. In practice, the station area is now zoned for apartments and mixed-use buildings, and only a small edge zone can still take townhomes.
The transit that justifies all of this is not running yet. In 2023, Sound Transit forecast that the NE 85th interchange and station would open in 2026, with S1 line service in 2028. The agency's July 2026 status report still listed construction underway and expected the Washington State Department of Transportation to hand over the project in the third quarter of 2026. The city's own page says the stop is expected to be operational by 2027. Treat the station as under construction until service is announced.
The market Rose 85 will open into
The zoning points toward future scarcity, but the market right now leans the other way. The Seattle Times reported that Kirkland's single-family median sales price was $1.27 million in August 2026, the lowest since January 2024, after hovering around $1.5 million for most of the year, citing Northwest Multiple Listing Service data. Through August 2026, 594 single-family homes and 311 condos sold in the city, down from the same period in each of the previous two years. A Kirkland broker quoted in that Seattle Times story called the city "a 99% buyer's market."
The countywide numbers show the same slack. The NWMLS September 2026 recap puts King County's residential median at $949,975 with 4.10 months of inventory, and its condo median at $496,000 with 7.05 months of inventory. NWMLS doesn't report townhomes as their own category, so no clean townhome median exists for Kirkland. The best guide to pricing is what a new townhome is actually selling for nearby.
What the same builder is offering in Kingsgate
Taylor Morrison is also finishing Senderos, a 60-townhome community in Kingsgate. Its pricing gives the clearest read on how a "from $1M" Kirkland townhome sells in October 2026.
| Senderos, Kingsgate | Rose 85, Rose Hill | |
|---|---|---|
| Status | Now selling, with move-in-ready homes | Interest list, late 2027 completion |
| Listed starting prices | $999,999 to $1,099,999 by floor plan | From $1M |
| Size range | 2,002 to 2,202 sq. ft. | 1,357 to 2,689 sq. ft. |
| Zoning position | Outside the station area | Exempted from the station-area ban |
The move-in-ready homes at Senderos show where the leverage is. The builder's available-homes page lists an A22 plan at 13209 NE 127th Court, Unit B, at $1,049,999, next to an earlier figure of $1,099,999. An E22B home appears at $1,099,999, next to an earlier figure of $1,272,263. The page also offers up to $50,000 toward closing costs on select homes for contracts signed from September 29 through October 31, 2026, when the buyer uses Taylor Morrison Home Funding.
That last condition is where buyers most often get caught off guard. A closing-cost credit tied to the builder's affiliated lender is a term of the deal, not a straight discount. Its real value depends on how the lender's rate and fees compare with outside quotes on the same day. Buyers can ask for both quotes in writing before treating the $50,000 as a price cut.
Where the city is sending growth instead
Two miles southwest, the city is showing what it wants on land it controls. Kirkland owns the former Houghton Village Shopping Center at 10702 NE 68th St. The city's project page says the council authorized the City Manager in February 2026 to start the sale process and seek offers. The city picked CBRE as broker in June, and saw the property listed in July. The council will make the final decision on any offer. The development plan adopted in December 2025 sets a target of about 145 homes, allows a total within 10% of that figure, and permits buildings up to five stories in exchange for mixed-use and public-benefit requirements. The plan also requires 25,800 square feet of combined commercial, retail and community space.
Rose Hill and Houghton both started as aging shopping centers, and the city is pushing both toward the same outcome. On large transit-adjacent sites, Kirkland is planning for more homes stacked in mixed-use buildings and fewer homes with their own front doors and garages. Rose 85 is the station-area project that got approved just before that policy took hold.
Questions buyers are asking
Can more townhomes still be built in the NE 85th Street Station Area? Only on a narrow set of lower-height parcels east of 124th Avenue NE in the Neighborhood Mixed Use zone, or under the design-review exemption with its nine-month filing window. Detached and attached dwelling units are otherwise prohibited in the Neighborhood Mixed Use, Urban Flex and Civic Mixed Use zones.
Is the Rose 85 unit count final? The approved design-review plan is for 89 townhomes. The builder has said details, including home counts and prices, are still being refined.
Is the BRT station open? Not as of the latest sources reviewed. Sound Transit's July 2026 report described it as still under construction, and the city's page says it is expected to be operational by 2027.
Marianne Francis can review a builder contract, a lender-tied credit and the comparable sales nearby with you before you sign on Rose 85 or anything like it. Work With Marianne.
This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.
