Daily Journal of Commerce Photo
Fate of Parcel 8 remains a mystery
by Kennedy Smith
01/29/2007
A year ago this month, developers' attention turned to a 48,352-square-foot parcel in the heart of one of Portland's fastest-growing development areas: RiverPlace's Parcel 8. The Portland Development Commission had issued a request for proposals on the prime property, and the big question was: Who's going to bid, and what will they put there?
Twelve months later, the question remains unanswered. But now, Parcel 8 is back up for consideration, with PDC about to issue a new RFP later this week.
Parcel 8 comprises a city block along the Portland Streetcar line and sits south of the three-tower Strand Condominiums, being developed in partnership by Jack Onder and Homer Williams. To its east are the David Evans and Associates headquarters building and the Marriott Residence Inn.
During the RFP process in January 2006, the PDC only asked developers to comply with design and zoning requirements, which call for a building of no more than 150 feet in height – The Strand's east tower is 150 feet and its north and west towers stand at 125 feet. Architectural renderings were not required.
But only two companies responded – Hanover Co. of Dallas and Portland's Rembold Co. – and neither met the RFP's requirements, according to Geraldene Moyle, project manager at the PDC.
It would have been Hanover's first Portland investment. The development company, which specializes in multifamily residential properties, has developed three high-rises in the Seattle area, but most of its portfolio is in Dallas, Houston and Los Angeles.
Kali Bader, vice president at Rembold, when reached for comment said she was unaware that PDC has plans to issue another RFP, but she said the company would "have to see what they're looking for" before deciding whether to bid again. Bader wouldn't comment on what the company's plans for the parcel were last year in case the company does decide to bid again, she said, and the PDC could not locate Rembold's 2006 proposal by the time of publication.
Rembold's regional portfolio includes four acres in the Lloyd District, Russellville Park, a 154-unit senior apartment project in Portland and Villebois, a planned community in Wilsonville.
Speaking on why the RFP was shelved for a year, Moyle said: "No timeline had been proposed for this site. Now, with the environmental cleanup complete and The Strand coming on board, the market seems more appropriate now."
And the lack of responses to the first Parcel 8 RFP prompted PDC to go back to the drawing board, Moyle said.
"What we did after we closed out the RFP last year is we asked the developer community what they thought," Moyle said. "What we heard was that it would be interesting to team Parcel 8 with Parcel 3 across River Parkway."
Parcel 3 is a 91,476-square-foot property (about 53 percent larger than Parcel 8) located across River Parkway, directly south of Parcel 8. Whichever developer receives the go-ahead from PDC on Parcel 8 will have what's known as "first right of offer" on Parcel 3, meaning the chosen developer would be first in line to buy Parcel 3 if and when PDC decides to sell it.
Moyle said the new RFP will encourage developers interested in purchasing the property to include a mix of residential and commercial uses. The winning bidder will then enter into negotiations.
Parcel 8 was appraised in January 2006 at $4.59 million, but an updated appraisal is in process, Moyle said.
A "full appraisal" of Parcel 3 hasn't been completed, Julie Rawls, public information officer at the PDC, Moyle said.
"We anticipate the value to have increased due to several factors, including the success of recently completed developments in RiverPlace, such as The Strand and South Waterfront, the opening of the streetcar line adjacent to the property, and the pre-development work completed on the site," she said.
Mark Edlen of Gerding Edlen Development Co. said his firm would pass on bidding, just as it did last year.
Last January, developers Homer Williams and John Carroll both said they were considering bidding, but ultimately neither did. It remains to be seen whether they will this time around.
RiverPlace parcels 8 and 3
PDC acquired Parcel 8 in 1978 through a property exchange agreement with Pacific Power & Light. It acquired Parcel 3 the same year.
Parcel 8 must be sold prior to June 2008 in order for land sale proceeds to be used for repayment of the streetcar extension from Portland State University to RiverPlace.
Site location: Corner of Southwest River Drive and River Parkway
Size: Parcel 8 is 48,352 square feet; Parcel 3 is 91,476 square feet
Zoning: Central commercial with design review, greenway overlays
Floor-area ratio: 4 to 1 with potential for 7 to 1 with bonuses
Maximum height: 150 feet
Plan districts: Central City District and Downtown Sub-district
Environmental: Parcel 8 environmental remediation was completed in December 2006
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