PDC cuts price on Burnside Bridgehead site for apartment tower
By Wendy Culverwell
The Portland Development Commission is expected to sign off on a deal to sell land at the Burnside Bridgehead to an apartment developer for the reduced price of $1.54 million.
The city’s economic development arm is slated to vote on the deal to sell Block 67, a 0.76-acre parcel, to Key Development Corp. when it meets today.
The price was reduced from $1.65 million to reflect environmental issues identified during the due diligence period. Key will remove approximately 2,000 tons of lightly contaminated soils from the property, at East Burnside and Northeast Third Avenue.
Block 67 is one of five PDC-owned properties at the east end of the Burnside Bridge, long targeted for redevelopment as a key gateway to downtown. It is neighbors with Convention Plaza (since renamed the Eastside Exchange), a 97,000-square-foot office building that’s getting a $17 million makeover from Beam Development. The first tenants will move in later this year.
It is also hoped that developers will make the property, like the Beam project, a paragon of sustainable building. The Beam development features the repurposing of an entire building that, while a bit dilapidated, might one day again become a solid structure once the project is completed.
Key intends to construct a 16-story market-rate apartment tower over a five-level podium that includes commercial space and above-ground parking.
The $74 million, 340,000-square-foot project includes 276 apartment units, 21,000 square feet of commercial space and 201 parking spaces.
Key expects to close the deal by June 14, 2014.
It is financing construction with a $13.2 million equity investment from The Hold Group and a $58 million mortgage through the U.S. Department of Housing and Urban Development’s Section 221(d)(4) program and Walker & Dunlop.
The PDC will use the property sale proceeds to fund other projects in the Central Eastside Urban Renewal area. The property is expected to generate $450,000 to $550,000 in property taxes.
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