Monday, February 15, 2010

PDC an Old Town asset

The Oregonian essentially repeats (with some addition) a Portland Business Journal (sister publication) story that two developers want PDC as an anchor tenant claiming it would result in new construction jobs and a boost to property tax revenues.

The Portland Development Commission (PDC) is located in Old Town, but its continued presence is threaten by developers who just can't get enough of the free ride. I don't have much appreciation for PDC's urban renewal policies, but their presence has economically benefited Old Town.

PDC's employees spend money in Old Town; they have been supportive of Old Town neighborhood events; they have added much needed character to the neighborhood; and businesses have located there based solely on the desire and benefit of being close to PDC.

I hope that it is nothing more than a 'give it a try what do you got to lose' attempt on the part of the developers. But, in any event, it is a bailout plan for the two developers whose projects have stalled, of course not through their fault.

The costs of moving a public agency like PDC would be substantial. Who would be footing that bill? It was not that long ago, 2004, that PDC moved from its downtown location on 1900 SW 4th to Old Town. That move although welcomed was apparently a bid not to lose on an investment.

In some sense that move was like the proposed move. PDC moved into a building originally set to be a Creative Services Center (Center). PDC in 2000 invested $12 mil [Week 2/15/10] in urban renewal funds (property taxes) to retrofit the building for the Center, an incubator for startups. When that failed, PDC moved in.

Part of the 'failure' had to do with the economy after the bust. So there are similar argument to be made for the move. This from a 2004 Daily Journal of Commerce (DJC)article:

“According to PDC officials, factors such as the downturn in the regional economy, difficulties in the dot-com industry and general market uncertainty during the past few years created a difficult market for real estate and creative services industries and hampered PDC's ability to attract tenants at the center.”

PDC's had signed a 10 year master lease in August 2001, thus it is apparently up in August 2011. [DJC]. The building is owned by Kalberer Company. That company owns not only the PDC building (historic Mason-Ehrman building) but also the adjacent building and ¾ of the block across from the PDC building.

The adjacent building was also expected to be phase 2 of the Creative Services Center. It obviously never got close. Arguably, PDC lacks a certain expertise in its economic development strategy. .

Once again Old Town is the innocent bystander, the damsel forever in distress waiting for her rescuer. Frankly, I cannot imagine PDC moving out of Old Town, but still it would not necessarily be that surprising. One would hope that the very concept would bring outrage to the city government and the community.

Hope of this sort is ephemeral. The fact that it is just now being publicized suggests that negotiations are more at the end that at the start. But the removal of PDC from Old Town would be economically disastrous.

Talk about the nail in the coffin. I wonder how this will play out?

See Old Town blog for complementary view.

© 2010

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