Cosmos, which acquired the center for $6.5 million in July, havereportedly talked to Bellevue Community College about leasing spacefor its continuing education classes, and to King County libraryofficials about moving to the shopping center. Discussions withboth agencies are said to be preliminary, at best.

Regardless, Bellevue-based Cosmos International definitely wantsto upgrade the tenant mix by adding more "first-tier" tenants suchas brand-name supermarkets, hardware stores, drug stores, and videostores. Space would be created by letting leases expire onunderperforming "second-tier" tenants, or tenants that don't wantto renew leases at the current market rates of $17.50 to $19 asquare foot.

Lake Hills is the first of six older neighborhood centers wherethe city wants to work with owners to avoid physical and financialdeterioration. Bellevue and Cosmos each are putting $10,000 intoplanning the upgrade.