UPS, U.S. Military Talking Land Swap

PORTLAND-United Parcel Service and the U.S. Military are talking about a land swap that would give UPS room to expand its Swan Island sorting facility and give the U.S. Navy & Marine Corps Reserve Center a larger training facility for its so-called weekend warriors.

Under a proposed deal for which the approval of Congress is being sought, United Parcel Service would swap 18 of 51 acres it controls at Southshore Corporate Park for the 13.3 acres adjacent its Swan Island property where the U.S. Navy & Marine Corps Reserve Center is currently located. As part of the deal, according to local sources, UPS has also agreed to provide the buildings for the new Reserve Center, and will pay all moving costs incurred by the Navy.

One of the complexities of the transaction beyond congressional approval is the fact that UPS does not own 52 acres it controls at Catellus Commercial Development Corp.’s Southshore Corporate Center. In January 2000, UPS agreed to pay Catellus $9.8 million or about $4.30 per sf for an extra-long-term ground lease (believed to be 40 years) that includes a limited option to buy.