UPDATED 9/26/2011
On the eve of the deadline for an agreement between the Portland Development Commission (PDC) and California-based development firm LAB Holding, all signs point to a stalemate regarding the proposed Centennial Mills redevelopment plan. A recent press release from LAB president Shaheen Sadeghi suggests that an April directive from PDC that required 50 percent of the redeveloped space be dedicated to specific industry clusters is incompatible with LAB’s culinary-themed proposal, named SEED, that was accepted by PDC in 2006.
In his press release, Sadeghi cites a letter LAB received from PDC’s new executive director, Patrick Quinton, in April. Quinton writes that, as an effort to secure businesses with high growth potential, PDC requires at least 50 percent of the Centennial Mills tenants to be part of “identified cluster industries—software, activewear & outdoor gear, clean tech and sustainable industries, or advanced manufacturing.” These changes to the plan, Quinton wrote, would need to be made before the June 30 expiration of the memorandum of understanding (MOU).
Such a shift would require a significant change to what businesses populate the buildings as well as to the physical makeup of the redevelopment. PDC’s directive would force LAB to dedicate much of the redevelopment to office space, which is not the firm’s specialty. When asked via email whether LAB and PDC may still reach common ground, Sadeghi responded, “No, we are not interested in building an office building.”
Of the new directive, Sadeghi writes in the press release, “Despite three years of developing a culinary-themed, small enterprise focus for the development, Project SEED was essentially directed to start over with a completely different project.” He goes on to call PDC’s shift a “radical departure” and a “destructive approach to retooling a historic structure, and counterproductive to the community base of the SEED project.”
In a May 12 article, PDC River District Urban Renewal Area manager Steven Shain said that the controversy surrounding the project had “been mischaracterized” and called the PDC directive “part of the dynamic of negotiation.” When asked whether he agreed with this sentiment, Sadeghi responded, “No, PDC never asked our opinion, [they] just made a last minute demand.” Sadeghi also wrote that LAB has never been forced to make such a change “at this late stage of development.”
PDC spokesman Shawn Uhlman acknowledges that the project has hit a rough patch, but he insists that there is still desire on both sides to make the vast redevelopment a reality. “At this point, the clear takeaway is that we remain fully committed to the redevelopment of the site and we recognize the value of the project and the resource,” he says. “We’re going to do everything we can to ensure that the redevelopment does occur at some point.”
Uhlman adds that PDC and LAB have been involved in negotiations for a few years now, and that the current complications don’t necessarily mean that the project has been completely derailed. “We’ve had two extensions of the memorandum of understanding,” he says. “We’ve been working with them for a while and [the project] is something that we’re all certainly working towards.”
Barring an unforeseen, last-minute agreement between the two sides, the June 30 deadline may prove to be a tipping point for the Centennial Mills redevelopment. When asked whether PDC and LAB were renegotiating a deadline, and whether LAB has any sort of counter-offer in the works, Sadeghi responded with the following: “No, PDC has not offered an extension and we have not asked for one. To our surprise the scope of the project has completely changed from the original vision that we were selected for and the product/plan that we have been working on for the past 3 years. This was all a last minute surprise only weeks from receiving our DDA (Disposition and Development Agreement).”
UPDATE 9/26/2011: "PDC Mishandles Centennial Mills, Conflict of Interest Emerges"
By Ben Waldron, NeighborhoodNotes.com
They're Californian. Who cares what they think? When has California ever had anybody's best interest in mind, including their own? Just imminent domain it and move on; they don't know any better.
Props to NNPDX for bringing this story out in the open. Some interesting follow-up from the Oregonian as well:
http://www.oregonlive.com/portland/index.ssf/2011/06/blame_game_emerges_in_costly_f.html
Which notes that $13 million in public funds has been invested in the thus far fruitless attempt to redevelop this property.